GREY:CXEYF - Post by User
Post by
CalifDreamingon May 14, 2009 5:15pm
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Post# 15994197
UGLY financials....
UGLY financials....$21MM current assets. $47MM current liabilities and a "going concern" note on the financials...
Production was lousy - again. 1,063 bpd ave in Q1 with 3.5MM cfd gas. El Bibane isn't matching expectations at all. The outlook is grim for CAX...
The Company has a Term Loan provided by Bank of Scotland (the “bank”) as sole lender under a
Borrowing Base Facility Agreement which is secured by the Company’s oil producing assets in Tunisia.
The amount that is available to be drawn under this facility is determined by a semi-annual borrowing
base review that reflects amongst other factors the Brent oil price mandated to be used for such purpose
by the credit committee of the bank. The mandated Brent oil prices applicable to the second half of 2009
and for full year 2010 have in April 2009 been reduced and are significantly below current market prices.
The impact of this change is to increase the estimated repayment obligation of the Company as at June
30, 2009 from US$5.6 million to US$11.0 million, an amount which the Company would not be able to
meet from its forecast cash flows.
Management is presently in discussions with the bank to achieve a rescheduling of the repayment
obligation and, in the event that such negotiations are not successful, believes that the Company will be
able to secure the necessary financing through a combination of the issue of new equity or debt
instruments. The Company has also announced previously the implementation of a cost reduction
program in the last quarter of 2008, and the adoption of a flexible capital program for 2009 and is
continuing to take steps to reduce its cost base. Nevertheless, there is no assurance that these
initiatives will secure additional financing or reduce the Company’s expenditures sufficiently to mitigate
the potential adverse affects of the risks referred to above. Until the outcome of these matters is known
there is considerable uncertainty about the appropriateness of the use of the going concern basis of
accounting.