Dukes, the company already had sufficient funds to carry out 2016 plans and this included planned expenditures from this point forward in 2016 as outlined below:
- $900,000 at the Velardena properties for care and maintenance expenses;
- $1.6-million on exploration activities and property holding costs primarily in Mexico, including project assessment and development costs related to the San Luis del Cordero project;
- $400,000 on El Quevar project maintenance activities, property holding costs and continuing project evaluation costs;
- $2.4-million on general and administrative costs;
- $400,000 on an increase in working capital related primarily to a reduction in current liabilities.
The have $5.7 million now including revenue from Hecla mill lease and planned $5.7 million spending. They can reopen the mill by using the $900k allocated for care & maintenance and by cutting admin cost or exploration a little more or utilize the working capital increase allocated, lots of options even without the $4 million raise, just require decisions.
This $4 million raise nets them about $2.5 million after costs and paying back Sentient which can be allocated to yet as announced 2017 expenditure plans plus they will receive $5 million from the mill lease in 2017 for a total of $7.5 million unallocated dollars to budget with in 2017. It could even be better if Sentient now converts (minimal further dilution at this point) some more debt to equity given the float has increased and they have some room to stay under 50% so maybe add back $1.2 million available making the total possibly $8.7 million US dollars for 2017. This allows lots of flexibility for 2017 and they have lots of room to make decisions if they decide to allocate funds to mill restart.
None of this counts any possible deals for existing properties, selling San Diego, toll production to make money either on Golden's sulphide mill or someone elses mill using some high grade feed from one of the company properties as a short term measure. Maybe they decide to sell the oxide mill to Hecla, this would bring in many millions more than the lease although I don't like this option given they could in my view access oxide feed locally, not sure why they haven't to date other than metals prices have been to low.
Sentient is not domiciled in Cayman's they are just registered there as are many companies. They have alwys been long term investors and not adverse to investing for 5-10 years for the right returns or opps. I understand your concern with anything in this sector given the rough ride the last 3 years and suspect manipulations and banksters ever present but Sentient to date has been onside with shareholders as far as I can tell and see and it's not their fault management has made mistakes but for sure they have allowed excessive general and admin costs to go on too long even though they are down quite a bit from 3 years ago, this I can find some fault with.
Hope this short analysis sheds some light at least on my view of present financial circumstances and Sentient. This company has lots of spend options and sufficient capital to get the job done over the next 18 months or so for sure and they could easily make internal decisions to extend that or maybe even make money in production before the timeline runs, don't know the future but these are the facts as known to all.
