groundhog day for fitzgerald

What has the new board achieved at Bulletin since Fitzgerald and Co initiated the spill with their Requisitioned Meeting? Nothing so far it seems, apart from the replacement of the previous competent management and the destruction of the share price. An examination of the time line can lead to no other conclusion than this extremely disappointing outcome:

BNR’s share price has not shown any life since the ill-timed Requisition was announced on 2 June, amidst a major market correction, leaving the company with limited prospects of raising further working capital. It disrupted the rights issue that had been announced the previous week, and was followed by Fitzgerald’s apparent collaboration with the two major shareholders to vote against the resolutions put to shareholders on 9 July, which were to refresh BNR’s placement capacity following its depletion through several issues to these same shareholders.

Fitzgerald and Co’s Requisition was followed by a fall in BNR’s share price, to levels below 2 cents on several occasions (including one occasion that he then erroneously attributed to the actions of the then Board in Page 14, Point 2 of his Statement, which was included in the subsequent Notice of General Meeting lodged at the ASX on 5 July)

There has been no further announcement by the new board on the various unqualified representations made by Fitzgerald in his Letter to Shareholders of 2 August, to: ‘implement a new funding strategy’ and to: ‘move the Lamboo Gold Project into profitable gold production as soon as possible’, the aim of which was seemingly to persuade shareholders to vote out the then board and replace it with the present one.

So now, as it stands today, Bulletin has a last share price of 1.8c; it has just one single buyer for 150,000 shares at 1.5c, and just one other buyer below that for a mere 2,057 shares at 1.0c. The market in Bulletin shares appears to have been completely devastated by events following Fitzgerald and Co’s Requisition on 2 June and by the subsequent lack of any new or meaningful activity by the new board.

The only intimation of the new board’s current intentions for Bulletin’s Lamboo Gold Project is in the recent Chairman’s Letter in the Annual Report of 24 September. The fourth paragraph of this states that: ‘We are investigating options for moving it forward. In particular, we are focussing on continuing exploration, with the aim of extending the known resource and reserves and increasing confidence in the orebody models’.

But this is exactly what the previous board were doing when they were removed, and what was condemned by Fitzgerald in point 3 of his Statement in the Notice of General Meeting, where he maintained that: ‘The Board had unexplainably shifted its strategy away from a production based objective to a resource definition operation’ (apparently ignoring the fact that in a public company, adequate resource definition is a pre-requisite for production).

In that statement he was complaining that the previous board were spending money to define additional resources, rather than focusing on taking the company to production, and proposed this as a justification for them to be removed and be replaced by him and his associates. But now that he has succeeded and is part of this new board, he and his colleagues are focussing upon doing exactly what he had previously complained about.

The Chairman’s letter does also make passing reference to ‘modelling alternate production scenarios’, but it is hard to see this as any more than an academic exercise, when operating margins have been even further squeezed by a significant gold price fall since completion of the previous board’s professionally-accredited feasibility study.

So it is Groundhog Day for Fitzgerald. We have a new, unproven board, who now rightly credit the previous board for their excellent track record and competence in completing a bankable feasibility study, acquiring additional exploration ground, and securing potential additional truck-able ore for the gold project, a new board who are now apparently planning to do exactly what Fitzgerald denigrated the previous board for doing: raise further working capital, and explore and expand the present resource base, in order to improve the viability of the project.

Furthermore, Fitzgerald’s new board has just issued a Notice of Annual General Meeting (ASX release 17 October), in which Resolutions 3,4,5 and 6 ask shareholders to ratify the very same issues of shares placed by the previous board to the 2 largest shareholders, that he and his associates previously voted down.

These placements were previously referred to by Fitzgerald in Point 1 of his Statement in the 5 July Notice of General Meeting as: ‘tin rattling capital raisings, detrimental to shareholder investments, and contribute to the market’s lack of confidence in the Company reflected by its low share price’. In his letter to shareholders of 2 August, he then referred to them as: ‘a series of dilutive and value destructive capital raisings’ and ‘death by a thousand cuts’, regardless of the fact that the funds raised were actually used to increase the size and thus the value of the company’s one significant gold asset!

So what have ended up with now? Apparently just a new board, installed to replace the company’s founders, the professional competence and successful track record of whom was beyond doubt, as has subsequently been acknowledged by their replacements. Nothing has been achieved by this new board to arrest the destruction of the share price that started with Fitzgerald and Co’s Requisition to remove the previous board on 2 June, and there appears to be nothing of substance in the offing.

I for one am so completely dissatisfied with what has happened at Bulletin that I am going to oppose all resolutions put to shareholders at the coming AGM, in protest against what in my opinion have been Fitzgerald’s very contradictory and therefore questionable actions.








(Do not act on anything I say. I am not a financial adviser and this is not financial advice.)