scott, I'm not an RYO evangelist but am long as a speculative investment.
I was quite heavily invested in RYO at one time but sold a large portion
of my shares based on the high risk that this company has become. If
some of the numbers that RYO has published re: mining cost per ounce
of gold at Kemess, and we get a spike in the price of gold, RYO could
provide a good ROI in the short term based on the heavy short position
in this stock.
The dilution of the shares is a big negative and the rumors of environmental
problems at Kemess are a major negative. I know that there was an interest
payment that was coming due on the $44 million that was borrowed in
December/January, however that will be paid off in full with the $120
million that they can start drawing upon at the end of May. I don't
know what the detailed repayment schedule is for the new financing but
would be interested in any info you might have. Incidentally, the average
daily volume for RYO has been 410,000 shares on the AMEX over the last
30 days.
Make no mistake, I know how risky RYO is and would not be surprised by
an RYO bankruptcy especially if the BC government decides to go after
them for environmental problems at Kemess. The risk is extremely high
however Trilon is giving them the $120 million, the geologists reports
have been verified by numerous 3rd parties, the unsecured bondholders
gave their permission for the new financing and accepted stock as
partial repayment for this magnanimous gesture, contractors continued
work without being paid for many months, and management has not sold
their remaining shares which is still a significant number.
A lot of this doesn't add up and for me , the risk/reward ratio is
worth some speculative capital. |
