commencement of production announcement

Interesting announcement today and the market has reacted well. And Ive followed the threads this evening with interest riding Posters waves of emotion.

For those who have followed my previous posts, youll know I like to research the facts and line them up against each announcement. I find it a difficult task uncovering the truth behind something which dictates our familys financial wellbeing. I find myself secretly cheering anything I dig up substantiating the story, whilst the facts punching holes leaves me queasy.

In the end facts reveal the truth of where we sit whilst emotions are those little voices in our heads bending the facts to a place you wish them to be.

So heres the warts-n-all of where we sit on this one:
*Its a premature announcement and reflects the pressure MSC is under. It announces Commencement of Regular Production which is actually scheduled to commence next month.

*Claims bulk samples were sent out in 2009, which must have been the Kaocem mortar product so are these new products out of Shanghai also a mortar? Or is this cement? More confusion on the mortar, cement issue.

*3 customers with a combined annual tonnage of 20,000 tonnes. Once again no names, no details so I take it these are potential customers. Or if Victors history is any guide, could it be these will be inter-company sales? Our own yet to be established panel company or paving company (read past announcements)? A predicted 20,000 tonnes across 3 companies across a year is actually a very small volume. Predicted strategy: Victor will shift small sums of cash to these dodgy inter-company entities and purchase small initial amounts of cement in an attempt to raise money of the back of sales.

*The economics just dont stack up. If you believe the fluffy figures in the announcement, the $3million revenue @ 20,000 tonnes equates to $150 per tonne. So we are mining the kaolin, handling at Skardon, shipping to China, handing at Shanghai, processing it into a concentrate, mixing other ingredients at the Shanghai site, handling at Shanghai again, shipping from Shanghai, handling at the end export site, then transporting to the customer all for $150 per tonne! And we havent even touched on insurance, currency exchange and the like.
How is this product going to make ANY profit at $150 per tonne?
And what does the Skardon kaolin sell for? Does anyone know? How much kaolin is actually used in this mortar or cement product? I cannot see how this is feasible.

*Talks of a 1.5 to 2 million tonne plant capacity. I remember reading something about Skardons plant capacity at some stage. It was also a big number. Management has a good understanding of a plants potential capacity. Great asset if you are selling plant equipment.

Sorry to burst the bubble, but I just cant find any substance. We have Commencement of production that hasnt started, talk of mortar samples that were sent out last year, talk of small potential overseas customers, and the economics of the product just dont pass the litmus test.

What about some hard facts? Still no news on:
*What is going on with Descrete? How do they fit in with this new Chinese JV?

*What has happened to the $10million paving customer?

*What is happening in the US?

*Panels? Bricks? Mortar? And on it goes.

As tempting as it is to believe this next big announcement, it stinks of the same old crew working the same old trick. Another announcement tailored to tease at logic and blur it into emotion.

Like most of you I am searching for something real to lift us out of this mess. Im sorry but I cannot get enthusiastic about this announcement at all.