cashflow, page-5

David
- You took the first figure that I had a double take over as well. The cash flow looks bad but for once they didnt play the figures and it worked against them.

At the year end they had $1.8m debtors and $1.2m trade creditors so 600k net.

At the end of September they had Trade debtors of $1.6m and trade creditors of $0.5m So the debtors dropped by 200k but the trade creditors dropped by 700k. The net effect is 500k which is a negative cashflow movement but not a P&L movement. So the actual operating cashflow for that quarter would only be $1m negative. They obviously entered into some borrowings during the period. It is going to be tight at January and I dont think they will make it so they need either to get their money in or to get some sort of capital funding. Maybe even a rights issue / spp @0.7c you would get a fair amount but limit it to $2m so that we can repay the note and overcome what is now looking more like project based debtors management (high peaks and valleys).

This is the reason I hate the 4C as it only looks at actual cashflow and does not reflect working capital movement. Too much manipulation possible IMO.

Understand the frustration but the news seems much like an annuity style business. Hopefully the AGM will give more info about how they see the year panning out. Projects are very large movements so you cannot predict what they will do unless you know what the pipeline looks like and at what stage the projects are. Not enough info to draw much of a conclusion other than to say the 4C was IMO designed to cover speculative miners and all it tells you is how much cash is left in bank it doesn't even tell you how much debtors you have which should cycle to cash in the next quarter.