That is one long 58 page report for a small company like Erongo. As i have an accounting background the first thing I notice is we had yearly losses of near $1.197mill. However our cashlow actually decreased by nearly $2mill. The difference is mainly due to exploration expenses put in the balance sheet rather than P & L.
So if we continue like this when we have only $2.8mill in the bank, we should have another year or two left of very basic exploring.
However results are needed now, not in two years as we have 27.5mill options that can raise about $5.5mill dollars by 30 Apr 09. This would need a share price of way over 20c by then as a bare minimum.
That takes us to results pending now, which is not many. 13 holes that were drilled in Aug in the Erongo granites project and testing of the heavy mineral sands iron ore content.
There are a lot of untested areas and with the money left, they can't afford to identify the wrong areas to drill.
In saying that, I go back to why every now and then there is a wave of buying when going by the facts presented no one should be buying. What is it we have not been told or missed?
ERN Price at posting:
6.6¢ Sentiment: LT Buy Disclosure: Held
