Well, declaration of production and production rates will come...

Well, declaration of production and production rates will come in time. There isnt a doubt about that. What the delays to full-scale production have done is pushed the company's finances up against the wall. i.e they have no free cash flow. And it is this which is weighing on the SP.

Invoices need to be paid. Luckily some of these invoice payments were deferred to Q3, but what this has meant is that any sales made will be soaked up by the deferred payments as well as current Q3 operating expenses. Management have confirmed that a CR will not be necessary. However to maintain a min cash balance to give them some buffer, they may draw down on the facility.

However any intention to draw-down will be announced independantly before the event. If they do draw down, the SP will likely remain depressed over the ST-MT for obvious reasons. In saying that I do not believe they will adjust production guidance as the plant can achieve an annualised throughput of 1.1Mt and thus 75KozAU. What is interesting and has me excited is that GE has stated that the plant can run at a rate of 3KT per day. Thats in excess of the 1.1MTpa. Its obvious to me that RED believe the plant can 'catch-up'. Which also bodes well for the LT as it means more than 75Koz of gold can be produced.

The market is more focussed on production at the present, rather than guidance. So even if its 40Koz, thats still $52Mill NPAT pa. Or $0.38 per share. Clearly if this was the issue the SP would be trading around $3.80 on P/E x10. So it must be production, and clarity on cash position.

At the moment I am not buying. But I will do in Oct when clarity around operating cash position and Q3 activity reports will be published.