Certainly, directors of Anaconda Mining Inc. (TSE:ANX), (PINK:ANXGF) must have expected a better performance by the stock on the markets. Especially when Anaconda announced yesterday a record gold production from its Canadian deposit. The shares, however, are far from their record value. Yesterday, they noted a slight increase on the Toronto Stock Exchange (TSE). At least, the trading volume was very impressive.

Anaconda_-_Chart_-_20_May_2011.jpgANX was in great demand by investors on the Canadian market. Over 3.34M shares changed their owner during the furious trading session. The stock finished the day at $0.09, gaining 6% from the previous close. In fact, sellers prevailed in the end and a black spinning top was formed.

ANX open high yesterday at $0.095, driven by a new company release. Anaconda reported festively a record gold production of 344.2 troy ounces in a single pour at its Pine Cove gold mine. Surely, investors were stirred by the news, but the company must have expected something more.

Maybe, it is Anaconda’s fragile financial state that acts as a restraining factor and prevents the shares from climbing higher. The company’s fundamentals show:
      * A net loss of $1.9M for the three months ended Feb. 28, 2011;
       * A working capital deficiency of $6.87M as at Feb. 28, 2011.

On the other hand, as the latest company presentation indicates, Anaconda reports progressing revenues and rising sales volumes since June 2010. In addition, it promises investors very encouraging development in the years to follow. For example, the company anticipates revenues of $22M and a net income of $5M in the end of 2015.

Anaconda_-_Logo.jpgAnaconda strengthened its financial condition by closing a $2.2M fully subscribed rights offering. For the purpose, the company issued more than 31.6M shares. It means that raising additional funds comes at the expense of stock dilution, which might be unpleasant to shareholders.