So why have no VG insiders sold a single share since June 24th? Why did GMT Capital, their largest shareholder sell only 1.8 million of their VG holdings and retain 5.2 million shares? And how is VG still operating when according to Singola58 their cash burn is massive and the company should be bankrupt by now?
My previous posts, in particular the Retained Earnings comments didn't received a single comment and just blended in with seemingly little notice.
TSX:VGCX Forum Post | HoneyBadger77-36122262 | RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:NOT GOOD! | Victoria Gold Corp (stockhouse.com) TSX:VGCX Forum Post | HoneyBadger77-36122248 | RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:NOT GOOD! | Victoria Gold Corp (stockhouse.com) So how much capital does VG have access to and can they avoid declaring bankruptcy? Well by my calculations they have access to ~ $200 million CAD as follows:
- ~ $40 million cash as of June 24th,
- ~ $113 million in Retained Earnings
- ~ $50 to 70 million in held back revenue from Q2 production and gold sales
It's interesting that according to this BDC (Business Development Corporation) Canada link, retained earnings are considered equity and that
"Banks will generally lend about three or four times what the company has in terms of equity, a major component of which is retained earnings."
"Retained earnings are the amount of profit a company has left over after paying all its direct costs, indirect costs, income taxes and its dividends to shareholders. This represents the portion of the company’s equity that can be used, for instance, to invest in new equipment, R&D, and marketing." What are retained earnings? | BDC.ca My guess is if all the company insiders, their largest shareholder GMT Capital, and all their lenders all believed this company going bankrupt is imminent, then this stock would already be at zero. The only reason they're all still here is because just like us longs, they currently don't have enough info yet to know exactly what happened and who is most liable and are no doubt awaiting more info on the degree and extent of environmental damage, how successful remediation efforts are, and what these two factors are going to cost.
We are now into week 5 of this debacle and retail shareholders are still left largely relying on the media for their information.so it's no surprise the shareprice continues to drift lower (being manipulated lower). By my calculations, VG has access to plenty of cash yet to pay down the $11 million in debt that was due on June 30th that they've intentionally defaulted on and will continue to hold off the wolves while they continue work to remedy this mess. I suspect that once some serious progress is seen to be made that all the players YGT, EMR, FNs and the Company will all stop pointing fingers at each other and see the value in working together to resolve this as soon as possible. They all have a vested interest in seeing a positive outcome in all this and the sooner they al realize this the better for all concerned. By now investigators have to have a pretty good idea what caused this and so does the company and if VG management were certain that they were negligent and therefore solely liable, they would have already declared bankruptcy.
My opinion only, please DYODD.
HB77