Hey WhiplashPotentially it is, or potentially it is not We all...

Hey Whiplash

Potentially it is, or potentially it is not
We all know FAS has been on a self destruction of it's own accord with the share price dilution but does it truly reflect the value of the company's potential?
They have gone from 6 cents 2 years ago, 4 cents approx 1 year ago to 0.006 today. So from $30 - 40 million cap down to $7m today. Why have they gone harder and spent more cash that the didn't have than every other potential miner in the Yilgarn? Regardless every potential miner in the Yilgarn has had massive share price falls so they are in good company. Many have less than $1m in the bank currently but FAS has gone further and has $7.5m in debt as well as only about $200k cash on hand but you can say the fall in their share price has been engineered by their own devices, i'd like to see how much money they have actually raised in this time frame through 3b's and none has been used to retire debt it has all been spent on something, the cash they have used eclipses the other would be miners?

As to where I get my conclusion FAS may indeed build the infrastructure even discarding the MOU signed in 2008 with EPSL check back to the last AGM presentation:

Page 12 "FAS Board and Port Proponent Group interfaces"

Page 15 "Complete port infrastructure construction and commission with EPSL and Terminal Operators"

At the time these statements didn't stand out to much but with more info on the EPSL website for the MUIOF to me this practically says they are confident they will deliver the infrastructure also 15 months to build is not a long time for any EPCM to get the finance, engineering drawings and decisions on what bits of equipment they need from which supplier unless the design of the infrastructure and from where it will come is almost a foregone conclusion. Also why aren't these loans called in long past due without good reason to hold off and just accrue extra interest, it doesn't make sense.
A lender is not going to just back off let interest (even if it is very good interest) accrue on outstanding loans without very good reason to think that they will get all of the money back but yet here we are this company has been a going concern for almost 9 months with outstanding dues exceeding cash on hand etcetera.

Also the $200m figure is being bandied about by people other than EPSL as stated by Shayne Flanagan in their media release 24th April, so the figure could be a lot less, it only requires in my layman's terms upgrading of an old ship-loader, conveyor system upgrades, new twin-cell rotary car dumper and more gravity vacuum sheds.

Do not forget that the FRL pass through notes are in euros if there was 50 x 5 million lots is $324m Aussie dollars today given recent falls, 60 x 5 is $384 million, I forget exactly how many they were chasing to place.

Regardless as the demise of the mining led construction boom fades and the Aussie economy with it this loan facility's value is going to increase as the Aussie dollar drops through unemployment rises, interest rate decreases etcetera. To the Esperance Port expansion it could also be the path of least resistance, particularly if the lenders are at an advanced stage with FAS.

Time will tell, personally i'd just like an answer are we moving forward to bigger and better things or folding ;)


Cheers