Member Info for Scottman72

BRD may control KVM but they are legally sesperate entities in all aspects whether it be taxation, regulation or liabilities. Less reputable companies use such subsidiaries to hide things they don't want to be generally known as they don't come under the same reporting requirements. It also means they can bankrupt KVM without affecting BRD.

When dealing with company statements you should never assume anything.
If an official company statement says one thing, irrespective of what it looks like or what it might turn out to be, you have to take it as read until confirmed as being incorrect. BRD have made a statement that a loan from KVM to BRD needs repaying and currently stands at £6m.

Either way, it needs clarification and a reissue if this isn't correct.

Your probably right. But that's not what the current section states.
It clearly states that the £6m is a loan TO BRD not from.

Connie,
It was attempted to be hidden in the recent release.
It’s just before the “Guidance for 2019 and 2020” section within the section entitled “Mining Right and changes to the South African Mining Charter”.
It states “Given the structure of the shareholders' agreement from the Company to Kareevlei Mining Limited ("KVM"), which requires the loan to BlueRock, which currently stands at over GBP6 million, to be repaid before any dividends are declared in KVM, this is expected to have little or no economic impact to the Group.”
In combination with other commitments it means all profits are now committed for probably 4 years. So no dividends for at least 5 years.

All in all. The BoD of BRD have now shown their hand. They only care about their own gains and don’t give a **** about those that invested to help make BRD what it is today.

I think we all await to hear about this £6m loan. If this has just happened this year then there should be £6m in cash for BRD to cover any further work that’s needed to be done. If it happened earlier than this then it should have been reported under AIM rules.
If it’s currently in their coffers then what’s the justification for the fundraiser. The only reason is to deliberately water down the current shareholders to ensure the BoD and their associates gain from any profits (guaranteed doubling of investment) as well as ensuring voting rites at the AGM so they can’t be ousted.

Now there's an idea. Maybe if they found some gold the shares would do better?

LOL.
I think it will be an 110 carat gem quality, flawless, but pink in colour. Value of 250m creating a very large but quick to drop spike.
So be ready to cash in ;)

??

Still hoping that BRD shares will recover from a 4x dilution without any additional come?

I think most are now hoping for that. Sell on a decent spike to recover some money rather than just selling now.

Absolutely. BRD doesn’t have the projected income to justify it.

Stringer.
Most are reporting Mcap based on 639m shares rather than 1.6B shares. So there mcaps are artificially low. Current Mcap is closer to 1.8m. Which is too high.

Jscapper.
Calcs below.
From BRD guidance.
2019 11,900 to 16500 carats at $340 per carat -> $4m to $5.6m income. -> £3.1m to £5m
2020. 16,200 to 21,500 carats at $340 per carat -> $5.5m to $7.3m income -> £4.2m to £5.6m
Asssuming exchange rate is 1.30
So at 40% these figures reduce to potential Mcaps of
2019. 1.24m to 2m
2020. 1.68m to 2.24m
With resulting share prices of
2019. 0.075p to 0.125
2020. 0.105p to 0.14p

Think I forgot about the exchange rate last time, so looks slightly worse :-(

Stringer, some examples.
Company. Income. Mcap. %
Petra. 510m. 195m. 38.2%
Mount Prov. 305m. 229m. 75.1%
Gem 267m. 124.8m. 46.7%
Firestone. 63.6m. 11m. 17.3%

Note, none achieve an Mcap greater then annual income and most are below half income. This unfortunately is where the diamond market is at the moment. Even if BRD achieved an Mcap equal to the maximum expected income for 2020, this still would only be a share price of 0.35p.

UT. Sad as it may be I fear the best thing to do is move on. There are better options out there. I for one have lost a lot here. I invested when I thought they didn't need to issue more shares. At that time I owned about 4% of the issued shares.
Now, anyone who purchased shares before the initial fund raise at the start of the year is likely to only recover their invested funds now they are worth only 1/4 Of the potential they used to be.

Not sure BOD is a good example. They have several areas of potential good mining. Thorny river itself is about to get a permit to start mining which is likely to provide annual income of at least 50% more than BRD. They also have two other potential mining areas which appear to have the potential for significantly more income that that. So I'm not surprised there mcap is higher.

I guess the other hope is that, as has been shown before, they recover a couple of very large diamonds which will generate a large spike in price and then sell before it drops back again.

UNkwnTrader, other companies in the same sector are the best way of determining future potential in that sector. For the diamond mining sector shares are currently achieving a market cap of about 40-50% of the yearly income. This is for already settled in companies, others trying to make it there are lower than this.
If BRD, from theguidance just released this suggests for Mcap of 40% of income that the 2019 potential will be in the region of 0.1p to 0.14p and then 2020 will be 0.14p to 0.19p.
Not great numbers and if anything overestimating rather than underestimating. The only hope for BRD to make a decent profit is in any future purchase.