Ghana Gold Corp (PINK:GGCO) are Desperate for Lift from Stock Runway

GGCO.pngIt’s been rather busy around Ghana Gold Corp (PINK:GGCO) recently. First there was the paid promotion about them, then some headlines came out, and now there is another pump with more news hitting the Internet.

It would seem that, at least at the moment, GGCO are actually concentrated on making people aware about them, and issuing news, rather than on the business of digging for gold. There is nothing wrong with the company raising the public’s awareness about itself and, of course, shareholders should also be updated with news constantly. Still, we would be much happier if we could see how they are getting on with the mining business.

We wrote about GGCO and we mentioned that they have gone through quite a lot of business ventures with little success in each one of them until, about six months ago they decided to move into the gold mining sector. The businesses they were involved with in the past are extremely diverse even for a small cap company and this makes us just that little bit more suspicious of them.

But let’s not dig into the past for too long and see what they have now. The latest financial report looks good at first glance. At least when it comes to the financial statement:

  • cash: $1,148
  • current assets: $571 thousand
  • current liabilities: $349 thousand
  • revenue for Q2 and Q3 of 2012: $987 thousand

Yes, the money in the bank won’t be enough to pay the monthly wages, but at least the assets outweigh the liabilities. And the revenue looks impressive… until you consider the operating costs. Put them into the equation and you will see that at the end of September 30, they had a net loss of $237 thousand.

0GGCO_logo.pngThen the report takes on a stranger turn. For one, you have three or four pages with not a word on them, and at the end of it, where the company CEO has to declare that he/she has reviewed the everything and agrees with it, the field where his or her name should be written is also left empty. We are pretty sure that if they want to be taken seriously, they will need to do something about such reporting mistakes.

All that being said, they are still in the initial stages of the gold exploration business and time will indeed tell, whether they will be successful. The problem is that they are not off to the best of starts with the promotions flying around them every other week. In order to get a better understanding of what we mean exactly, you can have a look at their chart and see that so far, promoters have done them no favors at all. Although they keep pumping press-releases, as well, we doubt that it will keep the fire going in the long run.

5TWGI.pngSince we mentioned the promoters, we can’t miss out on the opportunity to give you an example of how badly things can turn up when paid advertising campaigns are carried out on smaller companies with volatile share prices. This weeks, the ones creating the hype around GGCO are Stock Runway, and we have followed many of their plays. As an example you can check out Wiki Group Inc (PINK:TWGI). They did rise for a short while during the campaign on them, after which they crashed hard, losing half of their price in just two days.

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