I was out most of yesterday, with so many posts, only read the fewwith a lot of thumbs up, so apologies if I’m repeating what has been said before.
A few random thoughts about the whole thing
With hindsight, it would appear when the sanctions were imposed, they should have downsized & become less aggressive with their expansion, similar to what they are now proposing.
Fuel was not included in the sanctions, will be interesting to see how this item affects other African Gold producers, RSG, WAF, PRU
Everyone except for retail shareholders seemed to know there were problems with Morila hence the drop from 35c post demerger to the present 20c
It is the Board that approves the LOM Plan, the CEO/MD’s job is to implement it.
It appears to me the Board was very aware of the problems at Morila yet did not inform the market.
Was this because they wanted the demerger completed before addressing Morila’s problems?
(I'm not saying that's an excuse)
Mike seems to have taken the fall, I’m sure it’s not all his fault
Why did the 2 female Directors resign, they would have known about Morila’s performance problems when they were appointed (re the cost)
When the Board purchased $20m of Leo shares in the offer, they must have known funds were short, to then sell them at a $7m loss within 4 weeks is telling.
The above is obviously not good, but has been done - you can’t unscramble eggs.
As shareholders we have 2 choices, hold or sell
If you’ve lost complete faith in the Board/Management sell when you can
If you still believe in the asset & think the Board/Management can turn the operation around - hang on
Firstly IMO to restore some faith we need to employ a reputable MD/CEO
We also need someone senior on site 24/7
The initial plan they’ve outlined IMO seems to be headed in the right direction.
I never understood why they needed to mine N’Tiola
Not mentioned is the sanctions have now been lifted
Hopefully the 8-9,000 oz pm can put them in a cashflow positive position & then expand as funds allow.
I presume Alistair will remain as Executive Chairman till a replacement CEO/MD is found.
Mike previously said the Resource upgrade was “on the brink”, it would be nice for this to come out before we start trading again and probably before they raise capital.
They probably should update the LOMP before we start trading so investors can see a clear path to becoming cashflow positive. It sounds like this is what they are doing going by the last headline dot point of the announcement.
Including overdrafts they now have approx A$60m & can raise about another $30m ish without shareholder approval. That should be enough working capital to get them through assuming they stop the cash burn with the measures they’ve announced.
Not good, but not the end of the World, I think most of the damage has already been incorporated into the share price.
