this stock was recommended to watso, about mid dec, by a person,...

this stock was recommended to watso, about mid dec, by a person, who knows more about exploration/ mining than most people - so watso has kept a bit of an eye on the stock. watso might be wrong with his quick interpretation of some numbers - but in the dec 22 update, the following was mentioned

"Cash on hand at 30 November 2009 was $22 million with all the $70 million senior Secured notes (including a short term $10m element) having been fully repaid (at a cost of $63 million) and with trade and other payables having been reduced from $44 million at 30th June to $14m at the end of
November 09."


take particular note of the last bit - ie

"with trade and other payables having been reduced from $44 million at 30th June to $14m at the end of
November 09."

now move forward to the recently released quarterly

and for the quarter

"Decrease in creditors for operations, exploration and corporate (12.4m).

the problem with cash flow statements, is that they only show cash flows - but do not show the build up of creditors (ie unpaid accounts). some companies show a cash figure, and then mention something along the lines of "cash, net of creditors"

ok - so difficult to say, but given that the company was not really in a position to pay down creditors in the previous quarter (ie july aug sept), then most of the pay down of creditors that the company mentions in the dec 22 report, must have happened in oct /nov - after the cash was raised - and the decrease in creditors was about $30m between june 30, and the end of nov.

if the quarterly report shows that the decrease in creditors for the quarter (ie oct nov dec) was only $12.5m (when for oct /nov there would have been a big pay down of about $30m), then this might indicate to watso that there was a big build up of accounts payable during december. sure, there must be overlaps somewhere

just watso, as an accountant,looking at the numbers - and is more than happy to be corrected