According to BE, its implied from their decision to forgoe Enami that it would not even be profitable or very minimally profitable. The company only provided the explanation of the $5,000 differential in the two samples to support their decision.
Now that we are burdened with a $20M dividend obligation on the financing, I agree that we are owed a very detailed explanation on the rationale, along with transparency of the financing terms.
Correct. the projected high-grades (10gpt+) could not offest the mining + transportation+ smelter fees of the Caren mine nor, ultimately the DL. There is no explanation as to why Maurizio wouldnât be sending ore to Enami if it were profitable (in lieu of another 24 months of waiting with extremely costly financing).
This being said, with gold at these prices its hard to understand why they wouldnât be trying to monetize the stockpile. The decision to abandon Caren was made when gold was closer to $1200oz. Gold is at least $700oz higher from when they made the decision to build the FF. My guess is that the the stockpile is not substanitive enough to warrant a new tolling agreement with Enami.
Iâm fairly confident is saying that Maurzio does not have an appetite to continue bankrolling any more mining until the FF plant has been built. A $6M spend seems to be his âthreshold.â
Construction cannot begin without an engineering and environmental permit in hand. It took the Peruvian company Iâm working with 9 months to receive their environmental permit (6 months longer than expected) but Chile is typically more proficient.
There is still a case to be made that this was the better option, even if enami was profitable. That is if the following are all true:
1.) there is a heavy split in our favor, something like 80/20 or better on the preferred dividend arrangement; and
2.) the additional profit from the existing stockpile to run through the FF plant vs sending to Enami can be shown to be worth an estimate of several million dollars. Using $5,000 differential from the sample and scaling down to reasonable gpt estimate; and
3.) This was not an insider deal cash grab.
If all 3 of those can be shown, it will earn my trust of this company again. #1 and #3 are simple to provide shareholders. Their unwillingess to do that to this point is very concerning.
And #2 is not all that complicated. Simply use an estimated gpt of the entire stock pile and the difference in estimated value from using enami vs ff plant. You can just compare revenue, you donât even need to prove out whether Enami was profitable or not. Show that the difference in top line revenue based on the current stockpile is worth $Xm . This shows that shipping to Enami is like throwing an estimated several million dollars in the toilet versus using that money to instead pay for expensive financing that provides an FF plant that is more valuable to the entire operation including the decades of ore that will be mined beyond what is currently stockpiled.
Again, at a minimum, these 2 huge assumptions need to be made transparent:
a.) There is some gigantic 80/20 or better split on the preferred dividends; and
b) this is not insider financing
The financing terms must be made transparent!!!
I used to have a few shares of NPER (another scam from Les and Co)
Eventually they disappeared from my account
Since mdmn is non reporting, I hope the same fate will not happen as it did with NPER
Itâs absolutely ridiculous we donât have the AUMC distribution yet when CDCH shares did convert
These guys have said theyâre going to do many things over the past decade but nothing actually happened.
They did say all mdmn shareholders including themselves would be treated equally.
That part is true as weâve all been screwed!!
If those of you who are so upset with what you feel should be happening have not contacted the company, then please keep your frustrations to yourself. If you have contacted the company, then share with the rest of us what youâve been told. The incessant whining is tiring!
FYI, Iâve contacted the company in the past with no response.
One could argue that the incessant âmaking of excusesâ is a lot more tiring.
Especially when those excuses, or âoptimistic spinsâ with no basis in reality, have a track record of âzeroâ.
Youâre right about that, Zotron. Itâs âthe sky is falling!â posts that annoy me most. There are a few flat out accusatory posts lacking healthy reasoning skills, while others post concerns in a balanced professional manner. But Auryn isnât responding to any of them, causing a vicious circle for us.
Hulksterâs post about Endeavour Silver Corp. is a great example of good communication. But thatâs not an OTC stock. Requirements for AUMC/MDMN have fewer obligations for disclosures - and that sucks.
Jimmyp1127âs recent post at: Auryn/Medinah - 2024 2nd Half General Discussion - #278 by Jimmyp1127 weighs what possibilities might lurk behind the curtain while Aurynâs lack of communication is stifling us. He presented his concerns objectively instead of making outright accusations. His equitable list would be perfect to submit to the BOD as is, imho.
BBâs posts come from his geological perspective regarding certain calculable factors. I donât recall him getting bogged down with more contract/financial terms discussions. He shares his valuable perspective without making absolute claims or demeaning anyone. Simply agree or disagree - itâs not an âargumentâ to be attacked. It just so happens that the real geological factors tend to be more positive in this investment.
Jimmy makes sense about this one âŚ
Oct 22, 2024
AURYN Mining Corporation Shareholder Update
AURYN Mining Corporation (OTC: AUMC) is committed to keeping our shareholders informed with the most current updates on our progress and strategic initiatives. As we step into the third quarter of 2024, we wish to share significant developments and our forward-looking approach to our mining and exploration activities.
Fortuna Operations
During this quarter, our operations at the Fortuna site have made considerable progress:
Mining Plan Developments
Our team has submitted a renewal application for our exploitation permit to the Chilean Mining Authority (SERNAGEOMIN) under the Small Mining Producers statute, allowing an exploitation rate of up to 1,000 tons per month â adequate for operations at Antonino. In parallel, our exploration team is identifying additional areas for future extraction to ensure simultaneous monthly ore production comparable to Antonino, thus creating a stable supply to support our Flotation Plant operations.
To further understand the potential of our site, our team is planning a comprehensive exploration effort. This will involve correlating data with nearby mining districts such as BRONCE PETORCA (to the north) and LA FLORIDA (to the south), specifically targeting regions at 1,550 meters below the Antonino level.
Flotation Plant Developments
We are making substantial progress in the development of our flotation plant, which will have a processing capacity of 100 tons per day. Current developments include:
Based on our progress, we anticipate that the flotation plant will be operational with all necessary permits by the third quarter of 2025.
Collaborating with Universities
AURYN continues its partnership with the University of San Sebastian. During this quarter, we are launching new research projects, including developing a regulatory requirements matrix for operations at Lipangue to create a quality control system for small-scale mining producers. We are also advancing the conceptual development of a low-cost filtering and utilization system for water from the Antonino Tunnel.
Future Updates
For further details and to stay up-to-date with AURYN Mining Corporationâs activities, please visit our website and subscribe to email notifications.
So, 3rd Q 2025, plus covering the $20M dividend, should put us in âprofitâ by 2027-2028. Patience is a virtue, waiting for the holy grail, well ⌠No way out, canât sell MDMN, canât really buy any amount of AUMC, if you wanted to. NO MDMN conversion to AUMC so youâd have a way out. TRAPPED !!!
Good update as it relates to providing important details on the FF progress.
Q3 of 2025 seems like a more reasonable timeline given where they are in the technical/engineering permitting process.
1000tpm also seems like a more reasonable target (and its pretty easy to get that exploitation permit at that volume):
20-30 tpd at 10gpt
assuming 200 days of operations in a year
1250 to 2000 ounces of production per year
$2 to $4M in annual cash flows.
Clearly that cash flow will go towards paying off Maurizioâs loan, the new $1M debt facility, along with the dividend, as a priority over the next couple of years BUT its a start.
Expanding on your very conservative estimates, $4million/70million shares is .057 per share. At todayâs share price of .47, the return on investment is 12.1%.
Letâs be a little more optimistic and assume that we can hit the max exploitation limit at 1,000 TPM, which should be doable as it is only half the capacity of the FF plant at 100 TPD. Letâs also assume that the GPT is 15 rather than 10.
1,000 TPM X 15GPT = 15,000 GPM X 12 months = 180,000 GPY
180,000 GPY/31GPO = 5,806 ounces per year.
5,806 ounces X $1,600 profit per ounce = $9,290,000 annual profit.
$9,290,000/70MILLION SHARES = .133 per share
.133/.47 = 28.3% return on investment at todayâs stock price.
Using either the 12.1% or the 28.3% return it would appear that the stock price at .47 is undervalued.
LONG time MDMN holder, have not paid attention in a while but still own 3M of MDMN with Charles Schwab. Is there anything I should be doing with my broker or are we just waiting for the conversion?
They just said on the Sept 9th update that they expect to be fully operational in May of 2025. One month passes and they are already adjusting to 3rd qtr.
They are committed to transparency but no financing terms. Ridiculous.
Drafting an email now
Sent:
Company notifications state AURYNâs committmemt to keeping our shareholders informed, yet specific details of the financing agreement have not been disclosed.
I personally, along with other shareholders, would like to know how the $20M preferred dividend obligation specifically impacts common shareholders. Are the $20M dividends part of a matching arrangement with common shareholders? Can you assure common shareholders that this financing arrangement was done at armâs length, not involving related parties? Itâs difficult for many of us to fathom a $20M obligation to borrow $4M was the most optimal deal that could be obtained, especially when sitting on significant collateral in the form of a high grade stockpiled ore when gold is valued at well over $2k/oz.
It would go a long way to issue some commentary on these concerns.
Thank you,
Concerned Shareholder
There really isnât much you can do right now as MDMN is not currently trading on the OTC.
Based on your math at a 12-30% yield I would agree that the current valuation is reasonable. However, your math isnât including the following:
Inclusion of down months. Based on seasonality, its highly unlikely that they will be mining every month ( 8 months?)
Using $1000oz ASIC ($2600oz profit) is aggressive but, even assuming this number, its important to understand that this is simply the âmining marginsâ. The actual net earning will be considerably less (even accounting for NOLs).
The first two years of profits will need to go to Maurizio. Said in another way, the enterprise value of the company is closer to 60-70 cents a share (depending on how the dividend is treated) which takes the âyieldâ down to single digits
As stated in the PR and by Maurizio in almost every conversation weâve had, the main objective of reaching small scall production is to fund exploration activities. Any profits, after Maurizio is paid back, will either be allocated to mandatory divis for the preferred or reinvested in expanding the asset porfolio.
IMHO, the market wonât reward AUMC with higher prices based on acheiving 5,000oz of annual production but, if the exploration results play out, or if the production is able to ramp (considerably) there is clearly upside. As a point of reference, the Peruvian co that I keep referencing is producing 10-15koz a year at 12gpt and is building a 350tpd CIL/FF that will get them to 35koz a year by June of next year. It trades at a $25M market cap (a discount to AUMC) and has all of the similar exploration upside. The junior market is recovering but still has a long way to go.
The numbers you are stating for your Peruvian company are impressive and appears as though there is good potential there.
However, a stocks market value is not based on the size of its assets or the gross revenue, itâs based on its profitability and or its net assets owned.
Iâm guessing that your company is not yet profitable or it has significant debt or it has incurred NOLâs that have eroded a good portion of the companies capital.
Is it a public company? If so would you give us its name for further analysis?
Funny enough, there is a $5M convertible (owed to my firm). Similar to what is owed to Maurizio. Their ASIC will go from $1500oz to $800oz with completion of the plant. So, they are currently profitable but not by much. Lots of similarities. I wouldnât recommend buying shares in this company, Iâm simply trying to provide a âreal worldâ comparison to highlight where the market is pricing these companies. Soma Gold was another one Iâve brought up in the past. I know if feels like a $35M market cap (AUMC at 50 cents) is âcheapâ but, if you actually look at comps that does not seem to be the case. Today, I think the fair market price is ~$0.20 (consistent with past posts). Thereâs no doubt AUMC can grow into its current valuation, and beyond, but it will take time and consistent execution.
