RE: MD&A out this morning15 Nov 2022 11:13
I try not to wade in here too often, but I agree with you on this one, and we have to start looking a lot closer at reality.
At the moment we have a valuable asset, that is not in dispute.
However, what we do not have is a plan or a board willing to deliver a plan to realise the asset.
Founder (NM) is quite clearly of the opinion that we can go it alone and develop the asset, but there is very little reason for anyone to support us in doing so - they would be stumping up the cash and the mining expertise whilst leaving a lot of the profit in the hands of SOLG that will not be contributing anything going forward.
So the obvious solution would be either a full sale of the asset (maybe just Cascabel in the first instance) so that the buyer can exploit it, or possibly a JV where SOLG are a very junior partner. The alternative is to carry on business as usual until we can find no more 'easy' money to keep us going and then trigger a fire sale.
Obviously I don't want the latter, and for me the former would be best for holders - we'd see a decent chunk of cash returned to shareholders and no longer have to support a board that seems to have lost it's way in the last three years.
Looking at the official news flow, I feel that this is what is being prepared for at the moment (I know that contradicts me saying that the board has lost it's way, but I think that they are to some degree making plans again now); getting full ownership of the resource is one step; the royalty deal is a small stepping stone to allow us to continue operating long enough to create a sale agreement, it is not long term funding and does not actually enable us to exploit anything, anyone that thinks otherwise is following a red herring in my view. The next step came this morning, with a very clear statement that we have enough money to run for another few months, but are not planning to do anything other than keep it ticking over.
I don't know what the final value of this will be - copper is currently in high demand, and that is likely to continue throughout the coming recession; gold will piggy back that copper demand as a circuitry component, so the value of the asset is not going to diminish anytime soon, but whoever takes it will need deep pockets to exploit it within the constraints that the local govt are imposing, so the value in the ground is not a good indicator as to what may be realised.
Just my opinions, got too much time on my hands this morning!
T