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Lotus Resources (ASX:LOT) has fallen -16% in Thursday trades after raising A$65M in a placement to recommence uranium mining activites in Mali and works on a separate project in Botswana. As ever, raising has prompted mixed reactions on the HotCopper forums, separating the true believers from the skeptics.
Perhaps of most concern to those in the latter camp is that before today’s news, the company – which issued a halt on Wednesday – closed on Tuesday at 22cps, though, that’s hardly the steepest drop. That’s likely why there were more true believers than critics as far as comments sections can be considered indicators of overall sentiment; the company pointed to new insto investors on Thursday backing operations.
Some may have been wishing the company did this about a week ago when news of fresh production issues from Kazakhstan led to a petite revival for uranium stocks; also a topic of discussion was the fact the company already had $75M on hand winding up the June quarter. It spent $1.3M over that same period.
The purpose of Thursday’s raise? “To further strengthen working capital for its recently restarted Kayelekera Uranium Project in Malawi and advance development of its Letlhakane Project in Botswana,” suggesting the company might be spending a bit more than $1.3M this quarter. That remains to be seen; at any rate, Lotus also highlighted the formation of an offtake strategy that requires “flexibility.” Make of that what you will.
LOT last traded at 19cps.
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