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Inca One Gold: Gold Prepayment Facility Expected To Continue To Drive Results

When it comes to the gold market, presently, headwinds are rather less than exciting. With the metal currently unable to
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This article was originally published by The Deep Dive

When it comes to the gold market, presently, headwinds are rather less than exciting. With the metal currently unable to return to new high’s that were hit last summer, the sector has, understandably, been hit with the doldrums. But that’s not to say that good opportunities don’t exist within the space as it stands today.

One such example, would be Inca One Gold (TSXV: INCA). A metal processor based in Peru that is focused on working with artisanal miners, the firm has been hit with two negative tailwinds over the the last several months, despite neither of those tailwinds actually having an impact on the firm operationally. The first, the loss of interest in the gold market by investors, is well known across the sector, and has been felt by any operator touching the metal. The second, is the election cycle that saw a less than favourable candidate elected to helm the country.

In terms of these two headwinds, the first hardly has to be acknowledged at this point. Despite endless money printing globally, gold and silver are perhaps the two commodities that have stopped moving to the north, and instead have sputtered over the last several months. How long this continues is a gamble at best – but that isn’t to say that the present pricing is tough on producers by any stretch, with record or near-record revenues constantly being announced every quarter by operators.

The second, headwind, the election in Peru, is more specific to Inca One than other players in the global metals market. Earlier this year, the country elected Pedro Castillo as President, the seventh President in the last decade, and the fourth President in a matter of twelve months. He won with just 50.13% of the popular vote.

A left-winger, Castillo lists his careers as a schoolteacher, and union leader, along with being a politician. With political views so far left that he has had to emphasize that he is not communist, its fair to say that certain sectors in the country were reasonably worried about their future. However, on the topic of mining, he supports the industry “where nature and the population allow it,” however he desires to increasing taxation where possible. Effectively, he has come to the realization that the industry is a major driver in the country for employment.

Despite these two headwinds, the operations of Inca One appear to be thriving – the company has produced record results this year in terms of monthly production, with production set to only increase as a result of recent events.

The month of May for the company saw some of the strongest production figures in history for the company, with 3,538 tonnes of ore being processed, resulting in an average of 118 tonnes per day, and a total of 2,219 ounces of gold produced, with the latter being a 94% month over month increase.

Production in June faired even better, marking a new record for the company – 5,183 tonnes of ore processed, beating a prior record set in December 2019 of 5,177 tonnes. The average per day processing during the month meanwhile worked out to 173, more than double the 86 tonnes per day processed in March 2021.

The significant scaling of production is largely attributed to what the company refers to as a US$2.45 million gold prepayment facility, which it received in March. The facility effectively enabled the firm to acquire the working capital required to purchase the ore needed for processing, resulting in significant growth for the operation. While that loan was shorter-term in nature with repayment occurring this past summer, the notable aspect is that such a low figure was able to drive production in a meaningful way.

Fast forward a few months to August 2021, and the company has secured a much more meaningful gold prepayment facility – US$9.0 million – with much more favourable terms. The arrangement provides for up to $6.0 million in initial capital, which the firm can use to scale its operations immediately, through the purchase of further ore to be processed.

The company as a result has indicated that it intends to maintain production at a range between 175 to 225 tonnes per day, thereby providing consistency to its results, with the target of achieving profitability.

This level of production is significant. In the prior fiscal year, the firm averaged around 100 tonnes per day of production beginning in the second quarter. For the full year, the firm processed 31,656 tonnes of ore, which ultimately translated to revenues of US$30.1 million for the year ended April 30, 2021. The firm is well on the path to improving these figures for fiscal 2022, having produced 27.5% of this annual figure in just two months this year.

From a valuation perspective, things appear to be slightly “out-of-whack,” if you will. With a market capitalization of C$12.59 million as of Friday’s close, and 2021 revenues of C$38.8 million, the gold processor is trading at 0.32x topline revenues – an anomaly in a market so focused on stretched valuations based on topline results.

If history is any indication, the multiple on Inca One may become even more wild if the latest prepayment facility continues to deliver for the company.

Inca One Gold last traded at $0.34 on the TSX Venture.


FULL DISCLOSURE: Inca One Gold Corp is a client of Canacom Group, the parent company of The Deep Dive. The author has been compensated to cover Inca One Gold Corp on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.

The post Inca One Gold: Gold Prepayment Facility Expected To Continue To Drive Results appeared first on the deep dive.








Author: Jay Lutz

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Peppermint delivers key milestones in the last quarter, including the launch of micro-loan platform bizmoPay

Special Report: Peppermint has had another significant quarter, delivering on all key metrics which was highlighted by the launching of … Read More
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Peppermint has had another significant quarter, delivering on all key metrics which was highlighted by the launching of bizmoPay.

Fintech company Peppermint Innovation (ASX:PIL) has had a very productive quarter, with the highlight being the delivery of its alternative non-bank micro-enterprise loan offering, bizmoPay.

In July, the company achieved a significant milestone after being awarded a financial lending licence for bizmoPay by the Philippines Securities Exchange Commission (SEC).

Following that approval, PIL immediately commenced a three-month pilot program for a select number of bizmoto agents to test out the bizmoPay platform.

The aim was to identify and optimise any friction points or blockages to ensure efficient  system operations before it started offering the loan program to more than 56,000 registered bizmoto agents.

The pilot program has rapidly expanded in the last two weeks of September to more than 150 bizmoto agents.

“Having initiated a select 10-agent pilot program to identify friction points in our bizmoPay system, we rapidly expanded the size of the pilot due to the level of interest shown by other bizmoto agents,” commented Peppermint CEO, Chris Kain.

Kain said the pilot program was so in demand that by October 12, PIL had issued 359 loans across its three different loan products – Platinum Plus, Platinum and Silver.

During the quarter, PIL also recorded cash receipts of $472,000, which was an 83% increase on the previous quarter.

The company is well funded, with a strong cash position in the bank of $2.7m at quarter end.

 

BizmoPay

The granting of a financial lending licence by the Philippines SEC allows bizmoPay to offer alternative non-bank micro-enterprise loans to qualified bizmoto agents, registered bizmoto network members, and enterprise platform partners.

bizmoPay services fully complement the commercialisation of Peppermint’s proprietary technology platform which targets four key business sectors – mobile payments, ecommerce, delivery and logistics and mobile financial services.

Based on data analysis from the first 45 days of the bizmoPay pilot program, loan recipients on average increased their transactional volume by approximately eight times across the bizmoto ecosystem of services.

“We’re starting to get a picture of an overall positive impact on the agents’ ability to conduct transactions across the platform, which is exactly what we wanted to do,” Kain told Stockhead.

And of course, the more transactions across the platform, the greater revenue that the company earns.

The bizmoPay pilot program started with only the Platinum Plus and Platinum loan products, with the shorter term and lower value Silver bizmoPay loan product commencing trials in the last week of September.

As such, no meaningful data were able to be collected for the Silver bizmoPay loan type.

The program yielded significantly different results in terms of transactional volumes and values across the first 45 days.

On average across the board, the total number of bizmoPay loan recipients completed 13 transactions during the first 45 days of the bizmoPay pilot program, and processed $1.05 per day in transactional value.

“That volume of transactions would represent an additional $22 million per annum in revenue if extrapolated across our 56,000 registered bizmoto agents,” said Kain.

“We’re also on schedule to deploy the next phase of our commercial roll-out for bizmoPay next month, whereby recipients will be able to apply for their micro-enterprise loans via their mobile app.”

Several agents significantly outperformed the average transactional volume during the first 45-day pilot period, including 20 agents who performed more than 50 transactions.

At the higher end, five agents completed more than 100 transactions, while one agent undertook more than 250 transactions.

Peppermint expects to expand bizmoPay’s agents to more than 56,000 users when the pilot is completed, with a target of $30m in micro loans over the next three years.

The graph below is an extrapolation of what the different average performance of each loan type would yield if applied across selected numbers of the registered bizmoto agent base over the same initial 45 day period of the bizmoPay pilot program:

Kain expects this simple and easy to use feature will be incredibly popular with many of its bizmoto agents.

The non-bank lending space in the Philippines is currently undergoing massive changes, especially in the mobile app space where users have exploded as more people access non-bank loan finance through their mobiles.

To capitalise on this momentum, Kain said the next level of regulatory licensing that Peppermint would be chasing is an Electronic Money Issuer (EMI) licence.

With an EMI  licence in place, he believes that Peppermint could turbocharge its capabilities in the digital transaction space.

“An EMI licence will allow us to facilitate any e-money transaction and service open-loop e-wallet accounts, providing all Filipinos – not just bizmoto agents – with a convenient and secure way to receive digital money and access digital services,” Kain said.

“Every Filipino will have the chance to receive a bizmoPay loan, paid to their bizmoto e-wallet to access the bizmoto ecosystem and agent services. We believe this will stimulate significant transaction volumes over the bizmoto platform.”

In February, the company told the market that its phase 2 objective was the launch of bizmoPay.

“We’ve done that and ticked that box, so now we’re moving to phase 3, an EMI licence which is Peppermint’s next objective in delivering financial inclusion to the Filipino people.”

 

Other significant milestones

In March, PIL signed an API agreement with the Bank of the Philippine Islands, which saw PIL’s proprietary bizmoto platform integrated into the bank’s operating systems.

The integration will begin during Q4 2021, with the product expected to go live later in 2021 or early 2022.

PIL’s strategic Merchant Biller Agreement  with Cebuana Lhuillier back in April allowed its bizmoto agents to cash in money and top up their mobile wallets at any of the 2,500 Cebuana shop fronts across the country.

The API that serves as the gateway for Cebuana Lhuillier to send funds has now been developed, with a projected go-live date later this year or early Q1 2022.

Integration of the bizmoto platform with GCash as a payments facilitator is also underway, and expected to be launched in December.

Once the GCash offer is live, bizmoto agents, riders and merchants will have exposure to approximately 46 million registered GCash users throughout the Philippines.

PIL’s bizmoTinda website meanwhile, has been improved to include multi-vendor customer and multi-vendor merchant functionality, allowing  users to register as multiple vendors or multiple merchants.

The bizmoTinda allows users to sell their own items, with the convenience of having their own website.

Other milestones during the quarter include launching a blog newsroom with the aim of providing non-ASX sensitive information and news updates about the company’s activities to shareholders.

PIL also executed a direct marketing campaign around bizmoPay during the quarter, introducing the concept of a “Planet bizmoto” community among its agents.

The primary objectives of the “Planet bizmoto” community are to experience unique value, be loyal to the brand and transact frequently within the bizmoto ecosystem.

This article was developed in collaboration with Peppermint, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

The post Peppermint delivers key milestones in the last quarter, including the launch of micro-loan platform bizmoPay appeared first on Stockhead.



Author: Special Report

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Silver Mines sets the stage for maiden underground silver resource at Bowdens

Special Report: Silver Mines’ aggressive drilling campaign at its Bowdens project in New South Wales has delivered more high-grade silver … Read More
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Silver Mines’ aggressive drilling campaign at its Bowdens project in New South Wales has delivered more high-grade silver hits, further building the case for a significant underground resource.  

Silver Mines’ (ASX:SVL) Bowdens project is already the largest undeveloped silver deposit in Australia, but continued high-grade results are providing strong evidence the mine will be more than just an open pit.

Four drill rigs are going full throttle as part of the expanded 30,000m drilling program, which has produced additional high-grade hits like 3m at an impressive 679 grams per tonne (g/t) silver equivalent from 306m, 6m at 382g/t silver equivalent and 14m at 264g/t silver equivalent from 322m from the Northwest and Aegean zones.

Drilling of the Bundarra Zone returned a notable intercept of 3m at 278g/t (44g/t silver, 3.18% zinc, 1.92% lead and  0.15g/t gold, from 255m.

Meanwhile, Southern pit extensions included 9.8m at 214g/t silver equivalent including 0.31g/t gold, from 39m; and 4m at 343g/t silver equivalent, with a higher grade 1.94g/t of gold, from 88m.

The Aegean to Northwest Zone is dominated by high-grade silver vein systems comprising substantial widths, while the Bundarra Zone is dominated by wide zinc, lead and gold bearing veins with appreciable silver.

“We are very pleased with these latest results; they confirm infill and extensions to these three new deposits which lie directly beneath the open-cut development plan,” Managing Director Anthony McClure told Stockhead.

“These results will feed into our maiden underground mineral resource which will be complete in the coming months.”

Silver Mines is in the final stages of development approval for a 2-million-tonne-per-annum open pit operation that would have an initial mine life of 16.5 years producing about 66 million ounces of silver, 130,000 tonnes of zinc and 95,000 tonnes of lead.

The drilling results so far have given Silver Mines the confidence to move forward not only with an initial underground resource at Bowdens, but also to concurrently move forward with a Scoping Study for a potential underground develoment.

The study will consider a couple of alternatives including the potential for underground development to start in years 3-4 of the open pit development to supplement plant feed with high-grade material at a rate of up to 500,000 tonnes per year.

Drilling below the open pit continues to extend the Northwest High-Grade Zone closer to the Aegean Zone, cementing Silver Mines’ belief these two zones are linked.

The Northwest Zone starts about 30m below the base of the proposed open pit and so far, is up to 20m thick, extending over 450m and continuing down plunge for at least 300m. But it’s not closed off, meaning Silver Mines hasn’t yet hit the edges of this potentially very big system.

Drilling targeting resources beneath the current open pit reserve is expected to run through until at least the end of this year, while drilling to test for system extensions to the Bowdens deposit will continue into 2022.

 


 

 

This article was developed in collaboration with Silver Mines, a Stockhead advertiser at the time of publishing.

 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

The post Silver Mines sets the stage for maiden underground silver resource at Bowdens appeared first on Stockhead.




Author: Special Report

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Resources Top 5: Investors pile into ASX stocks as global magnesium shortage bites

China is slashing magnesium production due to ongoing power crisis and buyers are getting desperate ASX magnesium stocks Korab, Latrobe … Read More
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  • China is slashing magnesium production due to ongoing power crisis and buyers are getting desperate
  • ASX magnesium stocks Korab, Latrobe and Magnotec soar in early trade
  • Emmerson hits visual copper in drilling, Aguia inks phosphate sales agreement

Here are the biggest small cap resources winners in early trade, Tuesday October 26.

 

KORAB RESOURCES (ASX:KOR)

(Up on no news)

There are only a handful of current or likely magnesium producers outside China, which is slashing production due to an ongoing power crisis. Buyers are getting desperate.

$20m market cap KOR is currently in a pause pending a further announcement after shooting up almost 100% in early trade.

This sleepy explorer has been trying to develop, or sell, the ‘Winchester’ magnesium project in the NT for over a decade.

Over the last few months, KOR says it has been approached by two separate groups expressing an interest in developing Winchester.

The latest unsolicited proposal would see the two parties “jointly develop the Winchester quarry where the other party will fully fund the development in exchange for sharing the future profits from the quarry”.

No commercial terms have been met as yet, KOR said September 30.


 

LATROBE MAGNESIUM (ASX:LMG)

(Up on no news)

LMG plans to develop a 3000tpa operation which will convert fly ash from the Yallourn coal operations in the Latrobe Valley into magnesium and a host of other industrial products.

Latrobe still has engineering and other studies to complete before issuing tenders for construction of its plant in January next year but managing director David Paterson said end users facing supply woes out of China were already desperate to get their hands on mag product.

“That’s why we keep on talking about diversity of supply,” he told Stockhead on September 30.

“We’ve had probably at least three or four inquiries a week, probably one a day.”

“We’ve had two today just on can we supply mag at a price, at any price, because they can’t get supply.”

 

MAGNOTEC (ASX:MGL)

(Up on no news)

China and Europe-based MGL isn’t a miner, but it does sell primary and recycled magnesium alloys into the auto, power tool and electronics sectors.

In the first six months of 2021 the metals businesses experienced a ‘difficult period”. The principal constraint on Magontec’s metals business in China is the absence of raw material supply, it says.

“Auto sector output was constrained, logistics costs rose sharply, magnesium prices were volatile and Magontec’s key magnesium alloy cast house at Golmud, Qinghai province, PRC continued to source its raw material from regional Pidgeon producers pending resumption of supply from the Qinghai Salt lake Magnesium Co Ltd (QSLM),” the company says.

“Until this supply re-commences the MAQ business will continue to be unprofitable at the EBITDA line and, with depreciation charged on this currently non-performing asset, will continue to negatively impact reported profit.”

MGL’s other metals businesses — recycling of magnesium alloy scrap in Germany and Romania — is also challenged.

“A slowdown in the automotive sector due to chip shortages, among other issues, has reduced volume throughput for the European recycling facilities over the last 12 months and we don’t expect a recovery in the short-term,” the company says.

 

EMMERSON RESOURCES (ASX:ERM)

A maiden drilling program pulled up visual copper at ‘Hermitage’, one of a cluster of targets held by ERM in the 5.5Moz gold, 470,000t copper Tennant Creek Mineral Field (TCMF).

Drill hole HERC002 and HERC003 intersected thick zones of malachite (copper ore) chalcopyrite (copper ore), interspersed with native copper.

Here’s what that looks like:

Native copper in RC drill hole HERC003.

HERC003 terminated in mineralisation at 192m, ERM says.

Drilling continues, and first assay results are expected in the current December quarter.

Hermitage has not seen any systematic, modern exploration since the 1980s.

The first phase of this exploration is aimed at following up historic hits like 9m at 12.8g/t gold from 176m and 23m at 4.84g/t gold and 3.7% copper from 203m.

$37m market cap ERM has been treading water, up 7% over the past month and down 6% year-to-date.

 

AGUIA RESOURCES (ASX:AGR)

This aspiring fertiliser miner has presold 30,000 tonnes per annum of natural phosphate fertiliser from the ‘Três Estradas’ Phosphate Project (TEPP) in Rio Grande do Sul, the southernmost state of Brazil.

The MOU — with well-known fertiliser and agribusiness distributor Tuch — potentially represents well over half of AGR’s projected first year of TEPP sales, estimated at 50,000 tonnes, the company said.

The sale price from AGR to Tuch is $74 per tonne FOB for the product in bulk. Operational expenditure has been estimated at just $11/t.

The project, which will cost just $8m to build, is expected to produce 306,000tpa over 18 years following a three-year ramp up, AGR added.


The post Resources Top 5: Investors pile into ASX stocks as global magnesium shortage bites appeared first on Stockhead.




Author: Reuben Adams

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