start here

start here

The Daily IKN email digest, get all daily posts sent to you next day (& no ads)

I say things on Twitter

5/25/19

The top three most visited IKN posts this week are...

...in reverse order:
.
Third Place: "Atlantic Gold (AGB.v), winning friends and influencing people in Nova Scotia". The funny thing is how this gets shock horror reception, when a hundred similar incidents in LatAm between mining companies and protesters are ignored. All politics is local, right?

.
Second Place: "The massive rally in uranium prices is on!". Ho ho ho, jolly japes.
.
First Place: "I'm sorry! Did you just say "ten point five billion dollars"?". SolGold and its underwhelming PEA, so bad that even lumping the majority of capex into "early stage sustaining capital" and assuming U$3.30/lb copper fails to save it. The Mather doth protest too much, methinks.

5/24/19

IMPACT Silver (IPT.v) 1q19 financials

They filed it post close on a Friday...guess why? Yes indeed, in news that shocks nobody, another pathetic quarter out of IMPACT Silver (IPT.v):




Alternative business plan:
  • Collect underpants coats
  • ??????
  • Profit
UPDATE: Thanks for the mails, no need for another to tell me that working cap was positive by a massive 10k as at March 31st and I should have said "working cap negative now". Bless you all.

The Friday OT: Alabama 3; Sad eyed lady of the lowlife

In memory of group co-founder and guru Jake Black (aka The Rev. D. Wayne Love), who passed away this week:




I'd play his masterpiece "Hypo Full Of Love", but it's too much fun and we are all sad-eyed today. RIP, sir. Youtube here.

PS: Here are the words of Alabama 3 on the untimely passing of D. Wayne Love, May 21st 2019:

Early this afternoon, on a beautiful summer's day, our friend, comrade and spiritual teacher, Jake Black AKA The Very Reverend D.Wayne Love, passed over to the higher ground. After a magnificent performance at the Highpoint Festival in Lancashire, D.Wayne in his supreme wisdom, decided it was the appropriate moment for his ascencion into the next level.
The transition was painless and peaceful. He was surrounded by brothers Larry Love, L.B. Dope, The Spirit, Jonny Jamm and Sister Therese Mullan.
We are heartbroken.
All that remains for us, at this moment, is to carry out his precise instructions regarding the continuation of his teachings as a First Minister of The Presleyterian Church of Elvis The Divine, and continue The Great Work.
His last words, which we have yet to decipher, were "Tweet Tweet, Possil Fleet".


 

Atlantic Gold (AGB.v), winning friends and influencing people in Nova Scotia

My stars, what puppy have the Aussies overpaid for this time? Here's the link, here's how it starts:

If yesterday’s information session was meant to convince the people of Sherbrooke — or for that matter any other Nova Scotians — that Atlantic Gold has their best interests at heart, it failed — spectacularly.
And I mean spectacularly.
Not only were most of the people who spoke up strongly opposed to Atlantic Gold’s proposed mine in Cochrane Hill on the banks of the St. Mary’s River in Guysborough County, and very vocal about their fears of what the proposed open pit gold mine would do to the river and their community, the event also resulted in the brutal arrest of an innocent citizen.

Full thing here.

Pan American (PAAS) and The Curse of Ferrari Kev

The Pan American Silver (PAAS) price chart versus Gold & Silver Miners' Index (XAU), from the announcement they were buying out Tahoe Resources until today:



Not even the strong White Beaty Magic can overcome The Curse of Ferrari Kev.

5/23/19

A mining company quiz

It has a market cap of U$21m
It has a working cap of U$21m
It has a quarterly EPS of 2c
It has a growing cash balance and no debt.
Safe jurisdiction, too.

What is it?


Answer Sunday, subbers.

Copper is hanging in there

Just about:





Needed to stay away from the U$2.65/lb line today and did so. The dollar's drop helped most, of course.

The massive rally in uranium prices is on!

I heard it on Twitter, it must be true.


Gold miner G&A per ounce in 2018

Here's a chart, data from each company's 2018 annuals filed on SEDAR, which shows the G&A burn for a range of established gold miners and the gold (or gold equivalent) production for last year. It's all done to US Dollar, too (e.g. Wesdome's numbers get forex at 0.8/1):


First thought: Well done Pretium (PVG), which sometimes gets a cynical eye from this humble corner of cyberspace (though I am neutral on the stock, no long or short positions) but in this case deserves applause for keeping the ratio this low.

The other main thought: Can anyone tell me just why McEwen Mining (MUX) G&A isn't just more but so much more than the rest? What's more, its corp G&A number doesn't include the 49% of G&A spent at Minera Santa Cruz (MSC), that gets buried in the subsidiary filings but MUX still gets almost half its AuEq production from there.

5/22/19

Excelsior Mining (MIN.to): Hanging tough

Out of all the copper positions I own, MIN.to has held up the best during the copper spot slide. Here sat next to the copper producer ETF, COPX:


Hopefully, the upcoming visit of Louis Little Wolf Lobito James to Gunnison (week of June 3rd) won't put the kibosh on the stock. Good luck, guys!




We're rough. Are you tough enough?

Guyana Goldfields (GUY.to): At least Caldwell managed to keep his board seat.

Just.


NR here. Any idea who that 20m block belongs to, Mister Sheridan?

Chart of the day is...

...copper, dailies:



Breaking down again today and China once again allowed to buy cheap metal, all thanks to ÖTUS. Copper needs to hold $2.65, at least for the sake of the bulls (like me).

5/21/19

Abitibi Royalties Corp 1q19 financials: All Razzle, No Dazzle

Abitibi Royalties (RZZ.v, a.k.a. Razzle) reported its 1q19 financials this evening and...well, I just don't get why this company is so expensive. Its share count is tight for sure, with just 12.47m shares out. The balance sheet is tidy enough, as even though it runs a working cap deficit that's because it writes calls on its stock holdings and its $1.32m in cash is enough to do its thing. But the current share price, C$12.72, gives it a market cap of C$158.6m and that is really up there. For one thing, it implies a 4.7X book (and how many mining companies can command that these days, even royalty companies?). For another, you start looking at the P+L and it's hardly a dazzle, this Razzle:


Operating profit is tiny, but the way it gets to a 21c/share net profit is via the change in value of its share investments and those are basically its holdings in Yamana (AUY) (YRI.to) and Agnico (AEM). Over the course of 1q19 those stocks went up and made Razzle look good, the company able to pimp its net earnings by $2.96m (but doing nothing for free cash flow, which was negative by just under half a million, despite the company in its recent NR blowing its horn about making a million in cash flow). But relying on the movements of stock prices to justify one's own is a double-edged sword because since 1q19 closed, AEM has dropped around $2.50 to date. That meas a million or so loss for Razzle coming up in 2q19 (if things stay that way). Even worse at AUY, down around 65c since then and that's a cool $2.3m lost to date. So, those investments that propped up the meagre cash royalty revenues to the tune of $2.9m in 1q19 have already lost more than that in 2q19. 

Razzle is a nice little biz model yeah, but hell's teeth it ain't worth C$159m.


5/20/19

Newcrest talks to BHP

Newcrest: "Hi, how you doing?"
BHP: "Hey fine! How are you, I was just about to call you."
Newcrest: "Really, what about?"
BHP: "Was thinking of offering you the chance to buy another 11% of SolGold. Interested?"
Newcrest: "Hah! Funny you mention that, that's why I called. Was thinking about offering you the opportunity of owning another 15.23% of SolGold."
BHP: "Let's do lunch this week."
Newcrest: "Yeah, good idea. I'll get back to you this afternoon with a day."
BHP: "Okay, look forward to it."

I'm sorry! Did you just say "ten point five billion dollars"?

Seriously? In that country? To be exact, let's quote the CEO:

"The study team has been careful to separately identify start-up capital costs ($2.4Bn – $2.8Bn) and ongoing sustaining capital costs ($7.5Bn – $7.8Bn over the life of mine) and has differentiated this from operating costs."

I darned well bet you guys have, Nick. For further information, please consider the IKN post "The Real Meaning of P.E.A." from June last year.

The IKN Weekly, out now


IKN521 has just been sent to subscribers. Many photographs of a place called Copper Gold.