GBN.V Bloomberg Quote

I consider the numbers quoted in Bloomberg for GBN.V earnings to be exactly correct.

None of the operational circumstances would have led to a loss in Q4, and a loss for the year. The losses occurred on the financial side, obviously to do with a debt, or an anticipated debt. That GBN.V stated they were struggling with a deficit is really only a glib half truth, since they actually increased the deficit, and not paid it down. They left the projected pay-back period an open question.

What happened is the deal with Waterton(which was ironically finalized in Q2, fiscal 2013) required that monies be set aside from the previous fiscal year, so this resulted in a loss. That also means that losses will not show up in Q2, fiscal 2013. You will see these costs written off 'in prior quarters.'

The company has a habit, not necessarily bad, of paying for everything in the prior quarter. So the Waterton financing is in matter of fact, pre-paid. imo, the Waterton deal re-establishes shareholder ownership rights. Why else would they pre-pay a loan to Waterton only to have them lend it back with a hefty interest rate?

All of the cash out of profits inexplicably disappeared for the year in Q4 and had to have gone somewhere. You also have a work-to-rule management that make trade unionists pale in comparison. I don't think a trade union mentality could effect a loss at a company so effectively and work so hard at diligently producing a loss in a profitable gold mine, unless we're talking about the legacy problems of a zombie corporation.

The Bloomberg quote now has all of the financials:

http://www.bloomberg.com/quote/GBN:CN/income-statement

After all is said and done, you have an ~$11m. CAPEX for some unknown reason, which I believe to be related to mine expansion for the Roy Lloyd mine. You also have no inventory drawdown, and no mention whatsoever of stockpile draw-down. The loss did not produce a cash draw-down, either. ($11m/$1100/oz. = 10k. oz. production Q1, $540/oz. margin adds up to operational cash flow for Q2, for a break-even quarter, to be reported by the end of September.)

And I would venture to say that Waterton's required interest payment in bullion is already sitting in doré bar form in inventory since a few months, gathering dust, which doesn't need to be realized until next April.

Waterton aught to take their lesson in gold mining, swallow their pride, and buy a chunk of shares and start demanding a dividend.

-F6