The mentioned financial reports actually do not look so positive, but this has not prevented investors from appreciating a rise in the company’s shares. Some highlights from the financials:
- The net loss for the quarter ended Dec. 31, 2010 was over $2.1M;
- At the end of last year Jura had $874K in cash, compared to $770K at the end of the previous quarter and $2.68M at the end of 2009.
In addition, the company had $574,460 in working capital at the end of December 2010. As stated by Jura, this is expected to be “sufficient to fully fund general and administrative costs for the next twelve months”. Maybe investors were pleased to read this, and as a result immediately rushed the shares up.
Yesterday, on the TSE, JEC jumped up by over 28.5% and noted its new high of $0.095. The rise was confirmed by a turnover of almost 7.68M shares that changed hands.
However, Jura’s financial statements reveal the presence of serious problems too. “New cash resources must be secured to fully exploit the company’s petroleum and natural gas properties”, as written in the reports. Jura presently expects to spend approximately $17M for development activities on its Pakistan concessions over the next two to three years. This means the company will need to raise substantial capital in the future.
Besides, there is a great risk and uncertainty about the real potential of the six projects owned by Jura Energy. The company will have to first identify commercial oil and gas reserves and only after that it can hope to conduct profitable operations and generate revenues. Obviously, this is not going to happen soon. As already mentioned, Jura’s Pakistan projects will not leave the development stage in the next two or three years.
It is hard to determine the performance of the stock in the coming days. It probably depends on whether new major developments related to Jura’s properties will soon be released. Perhaps the speculative interest in the company’s shares will have a huge impact on the future behaviour of the stock too.
