Three Theories for the Great Silence, page-61

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Tcb007

20,092 Posts.

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11/05/17

18:31

Post #: 24634722
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Originally posted by longt ↑

I think the market is worried about their cash position. At the end of last quarter they had 3.1 million. They were expecting to spend 1.7 million this quarter. This quarter is nearly half over so their current cash position could be about 2.2 million (3.1 - .85). If they're over budget again then by the end of this quarter they could be running on fumes. I think MUS needs to be looking at their finances now instead of next quarter.

Borrowing from a reputable financier using their rubies at collateral would be ideal except they would need the rubies to be valued by a recognised expert. I don't think a financier would take the companies word as to the value of their rubies. They also don't have a record of proven ruby sales to back them up. I'm sure Gemfields could borrow against their ruby inventory because they have an established track record of ruby sales.

Unless they can sell some rubies through the black market that leaves them with an option of borrowing from a vulture financier or another placement. Both of these options are unpalatable and could cause the share price to go lower. MUS will be a buy when their financial position until October is assured and the market has adjusted the share price accordingly.

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$3.1m + they'll receive a further $600k which is resolution 3.

That's enough to get them through to July

Last edited by Tcb007: 11/05/17

MUS Price at posting: 3.5¢ Sentiment: Hold Disclosure: Not Held
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