Circumstances can change unexpectedly - yes it would have been ideal to avoid the CR at these SP's but reality dictates, it doesn't negotiate! Without the CR, any number of unplanned problems could have severely tested RED's financial viability in these extraordinary times .... may I remind you that the Spanish Influenza epidemic and the the Wall St crash of 1929 were not coincident, like COVID-19 and todays crash of the most overvalued overhyped market in modern history (read John Hussman). There was a short severe recession in the early 1920's, but the Fed loosen money supply and that lead to the "roaring 20's" which lead to the gross over valuation of the market, apparent to a few by 1928.
All talk of RED's theoretical value is meaningless if RED doesn't complete the FFS and continue the ground work for the new state of the art KOTH plant .... credit is going to be virtually impossible to get later this year as the credit squeeze worsens. Already worrying signs of bank stress are appearing. In the UK and NZ, banks have been directed to stop paying dividends and stop share buybacks .... dah !
If mortgage stress increases and defaults increase, then bank credit will become very very tight. If a non bank lender could be found, they will be much more demanding and will expect both high interest rates and very tight covenants .... which means that any failure to meet production and profit deadlines could be deadly. In the event of a company going into liquidation, shareholders are non-secured creditors and last in line for payout from the proceeds of liquidation.
Need I say it again - these are extraordinary, unprecedented times requiring extraordinary management. Survival only of the fittest will be the order of the day.
Now, RED remains completely in control of its own destiny .... because it has a very large war chest, a great asset(s) and a great team of managers, geologists and a very capable workforce, many of whom are shareholders of RED.
The whole market is very volatile at the moment .... my belief is that the great majority those who bought at 30c and those who bought at 18c are firm hands expecting much higher SP's. Some sell for a variety of reasons ... but the share turnover is a very small fraction of those in firm hands.
I acquired a decent lump in the CR, but have turned all my other shares, including SLR which I think has good upside, into cash reserves.
But if for some mysterious reason, RED's SP goes significantly below 18c, I'll be adding to my holding. Considering the quality of the assets, and the near term of the FFS and the new plant, the risk / reward ratio for RED is IMHO is currently the best in the gold sector, or any sector for that matter.
Time for another power walk and then a few more floor exercises ...stay strong, healthy and sane ....good sailors in good vessels will survive &thrive.
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