Member Info for DC2007

Hi Juxtapose,

Am I understanding correctly that you're saying short interest in Fres was 26% at the end of August?

Atb

Out of interest, why do you think it is more likely to double than to halve?

Atb

"Paul will probably do it. 40p per share at the moment. New shares at 39.5p per share (allowing a discount) Post recap 39.6p per share, with rapid recovery to a pound, probably by the weekend."

...with Elvis and NK as joint CEOs. I'm waiting for it.

"At 16:35 there will be an RNS saying NK is in talk with BOD about a BID. Watch this space."

I watched and...nothing. What made you so sure?

The report that they need another £150m in debt to keep trading: I think that will prove well founded and cause the SP to dive further.

To join in the guessing/forecasting game, I reckon 3 to 4p.

FT articles carry weight. If it even opens for trading on Monday morning, that's it for the equity valuation -- it's going to get demolished again.

It's endgame here for the big players. Small investors about to be all but wiped out; it looked that way for some time. Very uncomfortable weekend to hold a substantial amount.

Really Paul, are you pretending to be thick or being deliberately misleading? You're saying a 6% bond trading at a discount of over 60% to par has a yield of 2-3%?!

----> For anyone remotely numerate or financially literate, take the above as irrefutable evidence to ignore the entirety of every post of this commentator. If this isn't blindingly obvious to you, or you don't understand why that is, then don't be investing!

Equities are hardly the place to be then -- if you've made money, it's usually what someone else has lost.

Not sure if I've understood bigsmoke, but the directors say the reduction in CAPEX will eventually have to reverse (around the time the bond matures). My impression was that they are being forced into under-spending on the development of the mines because of the paramount need to conserve cash, i.e. the assets are being starved.

Atb

Some of the figures thrown about below are optimistic. If they achieve the low end ($150m) of FCF through to 2022, then new notes of around $500m may be possible. That leaves debt still too high. But their problem is, they will then need to increase CAPEX again which is going to mean issuing new debt.

They're in too deep with the debt they've already got; their revenues/profits, and FCF, don't give them the firepower to get out of it without help. Help could be d4e, rights issue, or a much improved diamond market. I think they'll have to ask for more cash to plug the gap.

Atb

@Perki

Probably the best answer is that there is no apprehensible reason for the wild gyrations today. Fluctuation in equity pricing exhibits strong similarities to random and/or chaotic behaviour. In other words, it's not predictable -- it can't be forecasted.

Atb

True they were, but I'm calculating based on the new relaxed covenants. They were guarded in their response to questions about it at the recent update. If EBITDA is around $150m, then they will be very close to breaching.

Atb

Maybe it's more to do with concern over whether they will breach covenants. It'll be close if they don't/haven't, and a disaster like that is what the market is pricing in.

Atb

A couple of questions for Red:

- Do you know NK personally? And,

- What is his 'business model' that you believe is so effective?

Atb

Good luck with the free stake then where-is.

I don't think being long the equity- whether it's you or Kock - is a clever move. It's gambling (far less so for Kock)) and there's a high probability of losing most/all of your stake.

That's the wrong way round where-is. Kock hasn't succumbed to herd mentality -- it's the people here buying in the thousands because he's bought in the millions who are herding.

Disagree. It really is very similar to Debenhams. Not only the BoD's comments and how the story has unravelled, but also, I think unintentionally, the form of your comments summarising the business and the situation. I think they are way closer to admin than you realise.

I've read some of the transcript from the earnings call at the end of June and all the red flags were there. That's notable given that these things are more often conveyed by tone and meta-language.

Mr Hyporcrite jed -- you've been saying for weeks this would soon be 40p to £1.50. Nuff said.

pioner3r -- have you not seen the video? It was extraordinary: a sitting CFO saying of current equity, "it will be traded down to almost nothing". The desperate need for new cash is spoken of too -- it's fair to infer if they don't get new cash, they'll be in admin.