Besra Gold Inc BSRAF

sad story

[zebra4o1]

Yikes, this company never gets a break. Keep thinking that maybe it is worth taking a small position again. But really if you think in terms of enterprise values, that stock is not extremely cheap. Considering the $90 million in debt, enterprise values is $100 million for a 40,000 ounces per year producer. I like this color from the CEO in the March financial summary: Q3 2014 sees us announcing another round of what can only be described as miserable results due to our on-going struggle to maintain our business in the incredibly difficult environment of Vietnam. At times it seemed that for every hurdle we cleared, another was being thrown up to slow our recovery. Notwithstanding this, the government of Vietnam has assured us that we have their full support - support that exists from the Office of the Prime Minister to the Provincial Peoples’ Committee. This was evident in the recent repeal of the $12 million export tax assessment against our operating companies there. Common sense prevailed, but only after a year of extremely difficult operating conditions, the negative effects of which are still being felt. We are still sometimes confounded by determinations by mid-level bureaucrats with little or no understanding of our business that end up costing us significant time and money. On more than one occasion we have been asked whether it would not have been better to close up shop in Vietnam until the situation improved, but we made the decision that is was better to maintain a production base, albeit a small one. Not producing gold and maintaining assets would have had its own costs which we would have had difficulty funding and would inevitably have led to the loss of those assets.