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8/22/17

Primero (P.to) and its trainwreck of a balance sheet

I did this whole thing on Primero in IKN431 on Sunday and that's not getting an airing here. But this was the visual aid in the note and just on its own...


...you get an idea of just how big a hole these people have dug for themselves. One thing about crass corporate errors is that they'll always end up showing on the balance sheet. Jeesh what a mess.

Keith Barron of Firestone (FV.v) threatens to sue IKN for defamation

If he turns out to be a real deal rather than a bloviating blowhard and acts on his threats, I'll show you the interesting and entertaining mail exchange we had this morning. However, there's no way I can counter-sue him for calling me an objectionable ass, because that's true.

The Inca One (IO.v) scam. Rich pickings

We chortled and guffawed at the exercise in pig-lipstickin' News Release run by the scam pump Inca One (IO.v) this morning. So skip last the "+109%" headline silliness and notice how throughput tonnage is at 60tpd. This compares to 57tpd in the previous quarter which the company assured was severely crimped by the prolonged spell of bad weather in coastal Peru in early 2017. Sicne then, three tonnes extra? When the same plant ran at 93tpd in December? And has a recently upgraded capacity of 100tpd? Hmmm....

So, what else? Oh yeah, the CFO has resigned. Splat. Replaced by the guy who ran corporate governance at Asanko (check that chart...oh how we laughed). Add the frippery that the brand new independent director who joined in January 2017 has also resigned (replaced by a cozy ex-HDI lackey).

And let us recall, this is the stock that brought in the man who killed Timmins Gold as Chair, Bruce Bragagnolo, in August 2016 then immediately paid Daniel Ameduri 450,000 to pump it from 25c to over 40c. Today 11c. Don't day IKN didn't warn you, because it did.


Chart of the day is...

...copper, weeklies:



PING! Copper prints a three handle for the first time since November 2014.

8/21/17

Firestone Ventures (FV.v): IKN explains

Want to know why Firestone (FV.v) has gone vertical? The IKN Weekly explained it to its subscribers two weekends ago in IKN430, dated August 13th:


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Firestone Resources (FV.v): A significant corporate development
Some people worship at the altar of Keith Barron, I think he’s a smart bizguy but the way he tilts the playing field massively in his favour when setting up a company leaves me feeling nauseous. He’s done it recently with that silly “El Dorado Search” company Aurania (ARU.v) in Ecuador (and hey, he found backers, who am I to judge?) and he’s now doing it again with the other company he controls tightly, Firestone (FV.v). This Friday NR (14) has all the details, here’s a couple of segments

As part of the Debt Settlement, the Company has agreed to issue to Bambazonke Holdings Ltd., (the "Lender"), a company controlled by Dr. Keith Barron, Chairman and director of Firestone, a total of 9,096,800 Shares, making the beneficial holding of Dr. Barron approximately 19.85% on a fully diluted basis of 50,872,791 Shares that are expected to be issued and outstanding following the Debt Settlement. Prior to the Debt Settlement, Dr. Barron owned directly or indirectly no Shares of Firestone. In July 2016, Dr. Barron was granted 1,000,000 five-year stock options to purchase 1,000,000 common shares at $0.05 per Share.
The Company proposes to complete a subsequent share for debt transaction whereby an additional $370,000 of indebtedness owed to the Lender and Dr. Barron will be settled through the issuance of Shares, also at the deemed price of $0.05 per Share (the "Proposed Debt Settlement"). It is expected that the issuance of Shares to the Lender and to Dr. Barron pursuant to the Proposed Debt Settlement will increase Dr. Barron's beneficial holdings in the Company to over 20% of the then issued and outstanding Shares on a fully diluted basis, thus making him a new Control Person, as defined in the policies of the TSX Venture Exchange. Accordingly, the issuance of shares for debt that results in the creation of a Control Person requires the approval by the "disinterested vote" of the shareholders which the Company will seek at the upcoming meeting of shareholders. The Proposed Debt Settlement is also subject to the approval of the TSX Venture Exchange.

It’s classic TSXV bullshit: The head man gets a salary, the tinyco has no money and can’t pay it, the debt is accrued month by month on the liabilities, the head man takes it in a debt-for-shares deal (when anyone truly caring for shareholders would have waived their salary years ago), then the company does a rollback, suddenly gets a new project, a new launch and a pump from The Usual Suspects. It turns my stomach frankly and people like Barron are not the solution, they’re the problem. But the set-up is obvious so if you’re looking for a pennycrapper dice roll for 2018, FV.v may interest you.


Disclosure: No position in FV.v and not planning to take one either. IKN is part of the solution, not part of the problem.

Panoro Minerals (PML.v) up 30% today: Your multiple choice quiz question

Answer at the bottom of the page.

1) Ignorance is bliss
2) You gringos truly will buy anything
3) Ignore the litany of fatal flaws, this is the TSXV after all.
4) Since when has uneconomic grade been important?
5) All of the above.











Answer: 5.





Think zinc (part X + 1), from IKN431

About a page and a half of yesterday's IKN Weekly IKN431 was dedicated to an update on the zinc market. Here's that piece, the only change being the last section in which we discuss the state of play in the three stocks chosen to ride the Zn upwave, plus the new one I'm thinking of buying soon(ish).



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Think zinc (part X+1)
There have been several pieces in ‘Market Watching’ this year with ‘think zinc’ in the title this year, so it’s pleasant to report that the macro thoughts behind the trade idea are panning out pretty much the way imagined. The basic idea has been one that we first identified back in early/mid-2016, but its sense of urgency is now increasing. It’s all about dwindling supply in the face of demand growth, the way that will push prices higher and the tell on all this would be a sharp drop in world inventory levels at the major metals exchanges. That’s worked out just right and I believe we’re now approaching the tipping point.

To recap slightly, in IKN419 (one of the better examples of ‘think zinc’) dated May 28th 2017 we highlighted how overall world zinc stocks had dropped to 524kt, down 30% in 2017 to that date. Here’s a chunk of script from IKN419 by way of reminder:

“…the real news is the London Metal Exchange (LME) and Shanghai Futures Exchange (SHFE) date. LME zinc inventories have been dropping for quite a while and went under (what is understood to be) the key 400k tonnes level at the beginning of the year. But the new news is the sudden acceleration of SHFE inventory destocking. Last week alone SHFE stocks dropped 14.7% to 78,300mt and according to Metal Bulletin last week, premiums for zinc delivery in China are at three year highs. Overall world Zn inventories are now 524k, down 30% in 2017 alone and put this weekend’s inventories at 11.75 days of consumption (i.e. there’s less than 12 days’ world zinc supply in the storage rooms of this world). That was 19 days at the start of 2017 and it’s closing in rapidly on what most Zn market-watchers consider the pinch point of 10 days. The way in which stocks have dropped like a stone in May means the crunch moment may now come more quickly than most people (including myself) were expecting. Up to now I’d mentally pencilled in Q3 or Q4 of 2017 for the time the Zn hype machine starts, instead it may come as soon as June.”

Cut to today and though the crunch moment didn’t arrive so quickly, the trend has continued and we’re now at 447kt, 41.1% down YTD. That puts stocks at 11.4 days of world consumption and that suggests there’s more upside to come from Zn, we haven’t reached the mania phase yet because as noted in IKN419 the classic trigger point for (something akin to) panic buying is when days of consumption drops under 10. When (not if) that line in the sand is crossed it might not faze real users so much but I’ll bet dollars to donuts the mining sector hype machine will crank it up and draw newcomers/latecomers in.

With that in mind and to ring the changes slightly (perhaps matching with the longer-term thoughts on gold in this week’s intro) I thought I’d look up a very-long-term chart of the metal today. After a quick Google rummage this elegant one at (20), Trading Economics (interactive too, I will return there) turned up that takes us all the way back to 1960:




Though the 60s were another country for base metals trading and flat, as from the mid-70s and for disparate reasons, one thing we can note about zinc is the way it will rally on a spike. The most notable and famous being the mid-2000s run that took it to U$2/lb briefly, but even the 1989 run made for a bottom-to-top run of +150%, anyone buying low and selling high then would have done just fine.

Will we reach $2/lb this time? I doubt it, the period before the financial crisis was weird in many ways and bubblemania spreading out from the house price boom was infecting many secondary markets. On the other hand, after last week’s breakout over U$1.40/lb (U$3,100+/tonne now) I see no reason why the rally should grind to a halt. And as mentioned above, the trade media hasn’t even clicked into “Supply Crunch!!!” hype mode yet.

Personally I’ve been playing the run with three trades up to this week but with....

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And the rest is for subbers.

Chart of the day is...

...the US Dollar, monthlies:


People who drone on and on and on about the imminent demise of the USD should read a freakin' history book or two. And STFU. There's life in the old dog yet.

8/20/17

The IKN Weekly, out now




IKN431 has just been sent to subscribers. Regulating Regulus.

Jerry Lewis

Anyone who hasn't seen Scorsese's 'The King of Comedy' should do so. One of his most under-rated movies, Lewis was a magnificent foil for De Niro and showcased his talent to a whole new generation.

8/19/17

Good news on Atico Mining (ATY.v)

IKN Nerve Centre hears that Atico Mining (ATY.v) has been thoroughly audited by Colombia's Environment people, all tests were passed with flying colours and the mine will re-open for business this very weekend, no problems at all. It had the feel of a minor issue at the time last week, but it's good to see confirmation. Smart money bought the dip.

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

...in reverse order:


Third Place: "DanO does Alset (ION.v)". DanO has done such a great job covering this blatant scam deisgned specifically to rip off greenhorns and as this should be the last in his series, we should doff our collective caps and thank him. Although utterly unimportant in the great scheme of things, Alset (ION.v) is a most useful case study for newcomers to the sector as we've seen the whole cycle in a short period: A mouthy, arrogant, unqualified blowhard company head suckers in greenhorns with smooth talk and then fails to deliver on the grand promises, hardly a surprise because the whole thing was a zero-content scam from start to finish. But moose/llama/camel/chinchilla pasture doesn't stop people running a scam from making money, the insiders trade the stock and get rich while the newbies get played from start to finish and don't see what's happened until it's all too late. Welcome to the TSXV, scamsters like the despicable whore Allan Barry abound and will be waiting for you with open arms forever. Want a friend? They'll be your friend.

Second Place: "Atico (ATY.v): The mine is closed by Colombia's Environment Ministry". Now old news, but this one got plenty of hits because IKN broke the story. It happens like that.
 
First Place: "Regulus Resources (REG.v)". A short and unimportant post, but it got love because the world loves to read about winners. Plenty on REG in IKN431 tomorrow too subbers, your author had the chance to sit down with the team and get the latest juice.

8/18/17

Bruce Forsyth

Good game.

The Friday OT: Freddie Mercury and Montserrat Caballé; Barcelona

For obvious reasons. Beauty, celebration and love win every time.



Youtube here. The shining jewel that is Caballé's voice. And as Freddie says at the very end, viva Barcelona. Freddie was right.

It would seem...

...that a few people read this humble corner of cyberspace.



Who knew? Just sayin'.

Gold pings U$1,300/oz for the third time since April...

...and the obvious question is now, will it hold the level this time?



Time will tell.

8/17/17

Junior markets surprise of the day is...

...how Constantine (CEM.v) only moved 3% higher on the back of this news release this morning. When your headline includes kickass stuff such as...

1.21 kilograms per tonne (38.9 opt) Silver over 2.7 meters
461 g/t (14.7 opt) Silver and 0.9 g/t Gold over 10.3 meters
11.3% Zinc over 17.8 meters and 9.9% Zinc over 20.4 meters

...and your market cap is under C$28m, you have to wonder why. I have a sneakydeaky feeling they might not have moved much because the NR only went out on some backwater service called Newsfile, not on Marketwired or CNW. If so, there's a shot at a sleeper move tomorrow Friday.

DanO does Alset (ION.v)

Put a fork in this scam, it's done. DanO sharpens his pencil and writes a few home truths about this house scam Alset (ION.v), right here. Particularly appreciated is the way he explains to what may be a lay audience just how the two-faced lying toerag of a CEO, Allan Barry Laboucan, tries to lipstick this pig of a company.

The buy theory on Primero Mining (P.to) (PPPMF)

A classic rubbernecking car crash scenario, it's tough to keep one's eyes away from Primero Mining (P.to) (PPPMF, which used to be PPP until the USA rightly pulled the plug on the main listing...in fact beats me why Canada hasn't put it back in the TSXV yet) at the moment. But there is at least a theory on buying the stock now, something I would NOT recommend until the potentially positive news shows up but as the stock gets cheaper and cheaper, it's starting to nudge the brain cells here at IKN Nerve Centre. The buy theory got a mention in the last paragraph of the short note on P.to in IKN430 in fact, out last Sunday.  Here's that piece.



Primero Mining (PPP) (P.to) sells Black Fox to McEwen Mining (MUX)

On the blog last week I had fun with the declaration of Primero head man Conway that, “…the divestiture of Black Fox is consistent with our previously disclosed strategic review process to maximize value for shareholders” (11), because it looks ridiculous on several levels. For one the share price collapse of the company in recent times. For another the whole way they buy Black Fox in the Brigus deal for C$220m, spend around $35m net on the asset and then less than four years later sell it to McEwen Mining for U$35m (not to mention losing Renaud Adams, who hated the Brigus deal and as a result left Primero, joined Richmont and made his new place a great success). It’s an unmitigated disaster, but in truth I do actually understand what CEO Conway was talking about.



I’ve been back to look at the PPP numbers several times in 2016 and 2017 as the stock got cheaper and cheaper and, as anyone obsessed with balance sheets could have told you, it was only a matter of time before the company collapsed completely. That in turn meant that before the announced deal last week, the company’s equity value (i.e. its share price) was still being overestimated by the market. Conway also knew this, which is why he agreed to sell Black Fox on the cheap and offload the liabilities that go with the mine, because if he didn’t PPP was on a one-way street to default. So yes, Conway was in fact true to his word about maximizing shareholder value because if he hadn’t made that distressed sale, it was only time between PPP and a zero cent share price.



On the subject, there is talk that PPP is in talks with Wheaton Precious Metals (WPM) in order to renegotiate its streaming deal on San Dimas. This alone won’t get the company out of the woods (they still have serious operational and worker relations issues at the mine) but if we see a deal announced PPP could suddenly become a buy.

Full disclosure: No position at all in Primero.

UPDATE: Regular maipal 'MP' writes in and goes the sardonic route:

Fishing > Capital Markets.

Fair to say that Regulus Resources (REG.v)....

...has had a good week so far.


And your humble scribe is meeting REG CEO John Black for dinner this evening. Any questions for him? You know the mail address.

IKN: Latching onto the winners like a bloodsucking parasite since 2008.

8/16/17

Until this line goes under 70X...

...you can put all that "bullish metals" talk on hold.




You don't have to be as stupid as Keith Neumeyer and his "going to 9X" malarkey to know that the GSR needs to go under 70x before a sustainable precious metals rally begins.

8/15/17

Atico (ATY.v): The mine is closed by Colombia's Environment Ministry

As of today. They need to tell us about it officially though.

UPDATE: ATY gives us a late-night NR. Doesn't sound quite as bad as it did, though IKN's First Law of Mining News Releases is still in play.

Regulus Resources (REG.v)

Oh lordy, what a hole.

UPDATE: Not just me who thinks so...


8/14/17

There will be no posting...

...on this blog today, for the third and last Monday in a row. For secret reasons.

8/13/17

The IKN Weekly, out now





IKN430 has just been sent to subscribers. We do bee two.

8/12/17

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

...in reverse order and during a quiet posting week for the blog:


Third Place: "And in a shock to nobody...". Alset (ION.v), the raging scam stock pumped non-stop to sheep on CEO.ca, finally delivered its waaay overdue assay results and...yup you guessed it, pure dusters. 
Second Place: "The best bit of the Primero Mining (PPP) news release today". My unhealthy obsession is with trainwreck mining companies. Your unhealthy obsession is reading about them.
 
First Place: "A Venn diagram". I'm glad you liked this one. Me too.



FWIW It'll stay quiet on the blog until this Thursday, at which point your humble scribe returns to something akin to his normal life and this humble corner of cyberspace gets back into full swing. Just so you know.

8/11/17

Allan Barry Laboucan on CEO.ca today

Alset (ION.v) is a scam, the dumbasses he hoodwinked on Tommy Humphrey's P&D site have finally started to work it out, the stock is now dead (at last) and the scam frontman Barry is reacting exactly the way you'd imagine. Makes for great teevee.

A whore will do anything for $5k a month. Hey Allan, it's been a long day but all the same, don't overdo the tequila tonight.

The Friday OT: Alabama 3; R.E.H.A.B.

A house favourite band, as cool as is humanly possible and this track just hits such a great groove.




Assessment successful, good bye the blues. Youtube here.

The bottom line to Tahoe Resources (TAHO) (THO.to)

In order to blanket-answer a few mails.

It is indeed one of the worst run companies in the whole of mining (and my stars there's competition), I mean how could anyone take a deposit as good as Escobal and make it fail? But there is also, without doubt, a near-term trade in the offing here. When Guatemala's Constitutional Court pronounces on the case soon some time in the next couple of months (impossible to nail down the exact date) they will overturn the suspension currently in place and rule in favour of TAHO. On that day, this share price...


...will rebound. Probably not to the level of two months ago, it won't change the longer process at the Supreme court and it won't stop the roadblocks in place near the mine, but a win will be a win. Want my SWAG*? U$6.


In other words, picking up TAHO shares at U$5-or-abouts then selling them to dumbasses down the line who fall for the bullshit that will vomit out of Ferrari Kev's mouth in a few weeks time when the CC rules in favour of the company, is a trade. The end.

*stupid wild-assed guess

CPI soft, base metals down, precious metals up

Gold at 1292 early doors on the technical algo adjustments from the US macro input today. Later we'll see whether there are real PM buyers, but with GLD inventories at 12 month lows (in fact, lowest since February 2016) there's plenty of room for new interest from the Wall St. jocks if they decide they're bored of Amazon and Facebook and similar baskets of wonderful.


Today might be fun, but next week looks more interesting.

UPDATE: Gold back down to UNCH. The pop had no legs. 

PS: By the way, the people shouting NORTH KOREA!! GOLD!! 1300 IS JUST THE START!!" are the utter dumbasses of the market. Make a note of their names today, it'll do you a lot of good in the future.

Red Eagle (R.to) closes its placement

This morning Red Eagle (R.to) closed its rights offering placement for gross proceeds of a sneeze under CAD$30m. When the details of the situation and the deal were announced, your humble scribe ballparked that they'd need to raise at least CAD$20m in order to meet the obligations required for their re-tooling and re-opening of the San Ramon mine. That would have been bare minimum, but a more comfortable number would have been CAD$23m. Therefore the CAD$30m gross is a good result and R.to has no excuses on any failure to deliver on its new plan. So yeah, the company is still in a mess but it's in less of a mess than it was a few weeks ago and, as this price chart indicates, its recent trading action reflects that.



R.to has its cash. It now has the real work to do.

8/10/17

Pretivm (PVG) 2q17 results NR

The real news is right at the bottom:


"In addition, we are evaluating other opportunities to bolster our short-term working capital."


But don't worry, the working cap deficit is short-term only. Innit guv.

The best bit of the Primero Mining (PPP) news release today

This NR, this bit:

"The proposed transaction for the divestiture of Black Fox is consistent with our previously disclosed strategic review process to maximize value for shareholders," said Joseph Conway, President and Chief Executive Officer."

Maximize value.....max...i...mize...val...ue...IKN's advice is to consider that one slowly, mull it over, nibble at its edges. I mean, where the blinking flip and sexual intercourse swearword do you start with that blathering corporate nonsense? With the U$8 share price of Primero in 2014? Nah that's way too easy, we need to consider this chart as fairer game...


...because that runs from February 23rd 2017, the date on which Conway came back and took over the reins again. And it compares Primero to the Gold and Silver Index (XAU) and it shows The Conway Carcrash off 70% in less than six months. Or maybe this...



...the ten day chart.

Mining executives; the only people more stupid are the people who back them with their money. That's you, dumbass.

A Venn diagram

Further to a conversation this morning:



A visual described as "Simple and Accurate" by one of the most experienced people in the sector, too.

UPDATE: Regular mail sparring partner 'CM' chips in:
Sorry for expressing my anal mind but your diagram indicates that there are as many nice people as there are capable mining executives. I am not sure which of the two circles needs to be smaller but believing in the good of people, it should be the mining execs.
Answer: Dear CM, objects in the rear view mirror may appear closer than they are.

Gold is doing nicely, and...

...silver is, too. And copper. And zinc. Even lead. But gold is the thing.


McEwen Mining (MUX) buys Black Fox from Primero (PPP)

Sandstorm will be happy.

8/9/17

B2Gold 2q17 financials

Posted on SEDAR tonight. Here's a chart:


Off that, net earnings came in at U$19.264m. In balance news working cap U$46.135m with cash over $88m, you can see why The Clive extended the credit lines but BTO is still good to go on the final part of Fekola. Considering this will be a transformed company this time next year and considering the soft production numbers from Nicaragua, I'll take these numbers happily. Much more on Sunday, subbers.

Pan American Silver (PAAS) is different from other silver mining companies

Because PAAS makes a decent net profit.

Tonight's 2q17 number, $0.23 eps. Solid.

Argentina's PASO midterm primaries on Sunday

Here's the latest voter intention snapshot from this more extensive report. Cristina (Unidad Ciudadana party) is pulling ahead of the Macri candidate (Cambiemos) in Buenos Aires province, Massa (1Pais) left in the dust:



The big vote isn't until October, but Macri's government moves into dead duck territory as from this weekend. The de facto referendum on his first two years is going badly for the Prez.

And in a shock to nobody...

...except the morons at CEO.ca of course, Alset (ION.v) fails to find lithium at its lithium project and now becomes a ferts company by throwing a new bag of sequins in the eyes of the dumb. Scam is as scam does.

8/8/17

Still no posts

For secret reasons. Normal service will be resumed shortly.

Another Monday with no content on the blog

For secret reasons.

8/6/17

The IKN Weekly, out now




IKN429 has just been sent to subscribers. Reviews, news and views. And cats.

8/5/17

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


...in reverse order:

Third Place: "Bobby G: the scamster writes in". Oh Bobby! By the way, Google spellcheck wanted to change "scamster to "teamster". Just saying.
Second Place: "Dear Bobby G". Ohhh, Bobby!!! Robert Genovese and his own house of cards. You will note that his partner in crime Avi Mirman "was resigned" from his CEO post at his latest job on Friday due to the charges brought against him. Let's see if Bob has the same type of reaction...highly doubt it, the scumball.
 
First Place: "Asanko (AKG): The descent into bullshit lies" and the winner of the week by a nautical mile. AKG unravels and people suddenly care...you can tell by the blog hits. K2 Associates got laughed at when they went short last year and told the world exactly why. Nobody's laughing now, everybody's paying close attention.

8/4/17

Odebrecht corruption Peru prisoner news

Ex-President Ollanta Humala and his wife Nadine Heredia were up in court (and on TV) this afternoon, with their appeal against being imprisoned in custody before answering charges of corruption by Odebrecht, specifically on receiving U$3m and blowing it all on handbags and stuff. 

The judge said no, you two gotta stay in jail. Nadine reacted like this:



The Friday OT: Elgar; Nimrod

The adagio from the Enigma Variations, Colin Davis doing the honours:




Instantly recognizable, even before it was used and riffed upon in the best film of the year. Youtube here.

The Alset (ION.v): Now 12 weeks...

...between this ridiculous scam sending off its samples for assay and today, but still no news from the company. Apart of course the constant verbal diarrhea from its joke of a CEO, the numerically challenged Allan Barry, who has nothing else to do with his life except talk non-stop on the Tommy Humphreys pump/dump site CEO.ca, play golf and cash his monthly salary cheques. 


8/3/17

Bobby G: the scamster writes in

He's such a sweetie:

"Thank you for your wonderful colourful commentary, and I can only wish the same for you. But as Michele Obama said - when they go low - we go high !!!!! "


Bobby, when Michelle said high she wasn't thinking about white powders.

PS: Dear SEC, over the years I've had several mails from Bobby Genovese, commenting on posts and making veiled and not-so veiled threats. I'd be happy to share, feel free to write in. 

Asanko (AKG): The descent into bullshit lies

When a gold mining company starts by exaggerating its potential, then fudges its numbers to cover up shortfalls while praying at the altar of high gold prices to make everything awesome (and stop you from noticing the truth), the most likely outcome is that the lies are eventually found out and the truth rears its ugly head. And so it is with Asanko (AKG) and its 2q17 numbers. Two exhibits for your consideration:

1) July 19th 2017 was the day AKG announced its 2q17 production. At that time it told the world this, right at the top of the NR in bullet point number one: "...2017 production guidance of 230,000 - 240,000 ounces maintained". And just so you got it,  President and CEO Peter Breese looked at you in the eye and lied to you:
"...we expect the second half of the year to be stronger as we see the benefits of the plant operating at the annualized rate of 5Mtpa, the grade at Nkran improving, as we mine through the low grade zone, and the Akwasiso pit delivering planned grades and tonnages. We therefore maintain our 2017 production guidance."
And now, less than two weeks later, we get this:
"Subsequent to quarter end, recent information has prompted revision of 2017 annual guidance revised to 205,000 to 225,000 ounces at AISC of US$920 to US$960/oz..."

Subject to quarter end? Are you freaking serious? Are these people trying to tell us that they didn't know about a 15k oz projected shortfall on June 30th, or July 19th, but do now? Well yeah they are trying to tell us exactly that and if it were a company deserving of a little trust and respect it might go through, but for serial revisionists and BSsers it's not that easy. However, we don't have to suppose these people are abject liars any longer, we now know it 100% due to...

2)...the stockpile bullshit. Oh dear, they've finally shown their hand and demonstrated that they are liars and here's how it works. Today on the Conference Call, the President and CEO and blatant liar Peter Breesewas asked about the mysterious stockpile. If you recall, this was the data that they published happily, right up to the moment when they realized it was a tell on their false story. That's when they stopped publishing stockpile tonnages and grades but when asked by analyst "Chris" today to give an update, Breese said this:

"The stockpile right now Chris is around 2.4m tonnes at about 1.1g"

His words, not mine. So AKG claims to have 2.4mt on hand at 1.1 grams per tonnes gold, that's obviously false and here's why:
  • In its 2016 year end filings, on December 31st 2016 (the last reliable stockpile data) AKG told us it had 1,522,271 tonnes at 1.36 g/t Au (contained gold 66,669oz), plus a "marginal stockpile" (aka barely economic crap) 430,000 tonnes at 0.67 g/t Au.
  • In 1q17 they reported mined ore of 1.107m tonnes and processed ore of 0.908m tonnes.
  • In 2q17 they reported mined ore of 1.048m tonnes and processed ore of 0.887m tonnes.
  • Do the math and the stockpile should have increased by 0.27m tonnes during the first half of 2017. That's not my opinion, the mathematics demands. 
  • Therefore, the stockpile should be 1.792m tonnes. Or if you include the "marginal stockpile", it's 2.22m.
So where, pray tell, has an extra 180,000 tonnes of stockpile appeared from Mister Breese? And again, in other circumstances and with other companies you might be inclined to give a benefit of the doubt, with this obvious cover-up it matters, because it's a clear case of provable false numbers from the company head's own mouth. Class action lawyers, take note.

Just a reminder...

...that The Genovse family (Bobby et al) are the people who most inspired and taught Tommy Humphreys. Birds of a feather.

Dear Bobby G

certainly hope you die in prison.



U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 23895 / August 2, 2017

Securities and Exchange Commission v. Robert D. B. Genovese, et al., No. 17-cv-05821 (S.D.N.Y. filed Aug. 1, 2017)

SEC Charges Two Individuals in $17 Million Manipulation Scheme

The Securities and Exchange Commission announced fraud and other charges against two individuals and a related company for their roles in a manipulative trading scheme involving Liberty Silver Corp., a penny stock.
The SEC's complaint, filed on August 1, 2017 in federal district court in New York, alleges that, Robert Genovese, a Canadian citizen, his company, B.G. Capital Group, Ltd. and Abraham "Avi" Mirman, the former head of investment banking at now-defunct New York broker-dealer John Thomas Financial, Inc. (JTF), were involved in a scheme concerning Liberty Silver in which Genovese sought to increase dramatically the company's share price and volume and sell millions of shares into the market. According to the SEC's complaint, between August and October 2012, Genovese schemed with Mirman to sell Liberty Silver shares to JTF's customers in part by agreeing to loan $2 million indirectly to JTF without disclosing the loan to the customers. The complaint alleges that Genovese also touted Liberty Silver in newspaper articles while failing to disclose that he had paid for the articles, that he was dumping millions of shares of Liberty Silver stock, and the financial arrangements between himself and JTF. It further alleged that Genovese engaged in manipulative trading on a particular day, increasing Liberty Silver's share price and creating the false appearance of liquidity and demand for Liberty Silver stock.
The SEC's complaint charges Genovese and B.G. Capital with violating Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 and Sections 9(a)(1) and (2) and 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint also charges Mirman with violating Sections 5(a), 5(c), and 17(a)(1) and (3) of the Securities Act and with aiding and abetting Genovese's and B.G. Capital's violations of Section 17(a)(1) and (3) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5(a) and (c) thereunder. The SEC seeks permanent injunctions, disgorgement of ill-gotten gains plus prejudgment interest thereon, and civil penalties.
Separately, on August 1, 2017, Anastasios "Tommy" Belesis, the former CEO of JTF, agreed to settle SEC fraud charges. According to the SEC's order, Belesis misled his customers by soliciting them to purchase Liberty Silver shares beneficially owned by Genovese without disclosing the conflict of interest arising from Belesis's seeking the $2 million loan from Genovese and that Genovese, a major shareholder, was selling a significant portion of his position. The order finds that Belesis willfully violated Sections 5(a), (c) and 17(a)(2) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. Without admitting or denying the findings in the SEC's order, Belesis agreed to the entry of a cease and desist order, to pay disgorgement of $434,628.40, prejudgment interest of $64,266.86 and a civil penalty of $434,628.40, and to an industry bar.
The SEC's investigation was conducted by Margaret D. Spillane, Nancy A. Brown, Elzbieta Wraga, and Thomas P. Smith, Jr. and was supervised by Lara S. Mehraban. The litigation will be led by Ms. Spillane and Ms. Brown.

Asanko 2q17 financials

At least they didn't use the word "challenging" in the NR.

My stars, what a mess. Let the class actions begin.

Kinross 2q17 financials

I'm reasonably impressed. A couple of charts, starting with P+L matters and it's the drop in costs that makes the difference to gross margin:


Here's one of the balance sheet charts, showing how working capital is better than a year ago, little changed from 1q17overall but the proportion of liquid cash has improved. K could go out and buy something, even while finishing Tasiast.


BV/share is now a couple of tenths under U$3.50, which puts the price/book ratio at 1.18X. Room for improvement there.

This time last year Special K was a U$5+ stock. No reason why it can't revisit that level.

8/2/17

Argentina: Cristina to clean up on August 13th

It's the primaries (called "PASO") for the Argentina mid-term senate/congress elections on August 12th and here's how the thirteen latest voter intention surveys are calling the key Buenos Aires province:


Cristina Fernández de Kirchner is predicted as winner by all surveys, the average of the lead 5.2%. Which may help to explain why the Argentine Preso (ARS) is just about the only currency in the world currently losing hand over fist against the US Dollar:




Asanko (AKG): The carnage continues

K2 was right.
Muddy Waters too.
Marin Katusa shown as the numerical dumbass that he is.

Continental Gold (CNL.to): Locals march in memory of the six murdered security guards

Thanking Paul Harris of The Colombia Gold Letter for the info and link, this report in Colombia's El Tiempo is on the memorial service and march by locals in support of the six security personnel who died at the hands of illegal miners in Buritica late last week. Here are some of the photos of the demonstration:








Rick Rule does BNN

His Top Picks here. Good call on SAND, but he's still flogging his dead horse on Alterra (sucking up to Ross Beaty...it's understandable).

Keith Neumeyer's dumbass predictions on silver, one year on

You remember August 2016 when Keith Neumeyer repeated his blithering idiocy on silver? We had "silver going back to 9 to 1 versus gold, or 15 to 1". We also has "silver going to $25/oz in 12 months" and of course...OF COURSE...all on the back of a "Buy First Mining Finance (FF.v) call which at the time was backed up by the paid pump being run by that utter scoundrel and partner in Keith's grime, the paid whore Daniel Ameduri. On that link above is IKN's lengthy answer to all this stupidity, so here we are a year long and it's time to beg the question as to how all these things have worked out Well, we know U$25/oz silver never showed up (as I write, Ag U$16.65). And we also know that...


...the gold silver ratio hasn't dropped to or even slightly towards Neumeyer's delusional ratios, in fact the gold/silver ratio has moved from 66X to 76X. And as for First Mining Finance (FF.v)...



....hmmmm, less said the better.

still no content on the blog

for secret reasons.

7/30/17

There will be no posts on this blog until Tuesday

For secret reasons.

The IKN Weekly, out now





IKN428 has just been sent to subscribers. Among other things, we take a close look at a silver company.

More on the Continental Gold (CNL.to) deaths

The incident in Buriticá this weekend that caused the death of six security guards at Continental Gold (CNL.to) is headline news in Colombia, where there's a whole bunch of reports and analyses to choose from (Spanish language link). At the present time, the theory of a criminal attack on the security guards by illegal miners is the most likely chain of events, according to both police and local authorities. 

This link has the words of the only survivor of the seven people attacked. In essence, the seven were underground dong an inspection of a mine tunnel when they were attacked. The attackers set fire to car tyres, which filled the tunnel with toxic smoke. Six of the seven turned heel and tried to exit in the direction from where they came, the seventh at the back saw the tunnel filling with smoke and chose a different route, via a side tunnel where there was less smoke. He stayed there for about five minutes, then re-traced his steps towards the exit. He saw the bodies of three of his six companions on the way out, managed to get close to the tunnel entrance, almost suffocated himself and was helped the last few metres by a rescuer.

In a separate thought, we now know that CNL's claim of illegal mining being eliminated in the zone is complete bullshit. When a mining company gets absolutist, the way we find out the lies are always difficult ways. Also, as a friend of mine said in a mail this morning regarding CNL's NR on the subject yesterday, once the facts of the matter were laid out:

"The rest of the NR is shameful promotion."

Agreed.


7/29/17

BREAKING: Six Continental Gold (CNL.to) security personnel dead in Buriticá gold mine incident, Colombia

Reports are still early on this incident, but according to initial reports six seven security guards working for Continental Gold (CNL.to) were doing their rounds in and around their area of vigilance when they entered one of the nearby artisanal mine workings and found illegal miners working there. In the confrontation that followed,the illegals set off explosions and then burned car tyres underground, the resulting smoke asphyxiated the security guards. Of the seven guards, six died at the scene while one managed to escape and is now in hospital (and is bound to give more details once interviewed).

UPDATE: Here's what the secretary of the government of Antioquia told reporters a few minutes ago:

 "The security personnel of Continental Gold were doing their rounds and found that Cafeto Gold had got into their tunnel and were extracting gold, that's where the confrontation occurred. There were some explosions and a landslide. It seems, according to the security guard that survived, they set fire to care tyres that suffocated them and stopped them from getting out (of the tunnel)."

UPDATE 2:  CNL has given us a news release, read it here

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

...in reverse order:

Third Place: "The performance of major gold mining companies, February 29th 2016 to date", in which IKN kicks Goldcorp (GG) while it's down. Great mailbag feedback from this one too, thank you people.
Second Place: "Cordoba Minerals (CDB.v) hole ACD-063". Laugh or cry? You decide!
 
First Place: "The demolition of the Argentine Peso continues". I'm constantly amazed about which posts get popular and which don't. This one for example, not mining scandal or numbercrunching but a fairly straight comment on a macro financial matter. It seems more people are paying attention to Argentina and seeing through the neoliberal positive spin these days. By the way, since this post on Tuesday the deterioration of the Peso picked up speed and despite the Central Bank dumping U$305m on the local market Friday, the Peso closed at 18.01 to the dollar official and 18.43 on the street.

Dunkirk (no spoilers)

A great movie. But find out for yourself because if you start reading lengthy critiques, even ones that promise "no spoilers", it will detract from the pleasure of discovery of this film's layers. All I know is that this morning on waking up, one of the first thoughts of the day was "I want to watch that movie again" and it's been a long time since that has happened.

7/28/17

The Friday OT: Soda Stereo; En el Séptimo Día

Such a tight band. From the 2008 tour, they were great in the studio, miles better in gig.




No descansaré. Youtube here.

Updating Tahoe Resources (TAHO) (THO.to) shareholder value decimation

In the post "Tahoe Resources (TAHO) (THO.to): The decimation of shareholder value caused by Kevin McArthur's empire building designs" dated March 23rd this year, we considered just how bad the deals to buy Rio Alto and Lake Shore had been for the people who held those shares and believed in the tosh and nonsense vomited by Ferrari Kev to the market. But since then it's only got worse:
In February 2015 when Tahoe Resources (TAHO) (THO.to) bought Rio Alto Mining, it was an all-paper deal framed at a ticket price of U$1.09Bn. TAHO issued 75.991m shares to close the deal. Those shares are now worth U$425.5m.

Then in February 2016 when Tahoe Resources (TAHO) (THO.to) bought Lakeshore Gold, it was another an all-paper deal framed at a ticket price of U$569m. TAHO issued 69.239m shares to close the deal. Those shares are now worth U$387m.

Kevi MacArthur has taken U$1.66Bn worth of shares and made them into U$812m worth of shares. but hey....the dividend! Right guys???

Chart of the day is...

...the US Dollar, monthly:



No prediction, just observation.

Yamana Gold (AUY) (YRI.to) 2q17 financials

NR here, IKN comments in one simple and easily understandable image:


I loved the way Marrone's band of funsters told us this about the key issue, the balance sheet:
Balance sheet as at June 30, 2017, includes cash and cash equivalents of $132.3 million, representing an increase of $26.4 million from March 31, 2017, and available credit of $823.6 million for total liquidity of approximately $955.9 million. Net debt(1) decreased by $22 million ($2 million consolidated with Brio Gold) from March 31, 2017.

Oooh look, cash is up!! Net debt down!! No matter that the truth about its liquidity position, working capital, shows the financial reality that AUY is slipping into serious trouble:


Cash up $26.4m? Nobody cares, because working cap is down $17m and the main reason is its loan book, big fat nasty financial debt now coming into current liabilities, AUY has to find U$110m by this time next year or face the doo-doo. 

This is why Marrone has been so desperate to monetize the junk that is Brio Gold (BRIO.v). But when you're facing U$110m in hard cash debt repayments in 2018 and another U$223m in 2019, you need to return profits and this is a company that ran to a 2q16 loss of U$36.8m. Math don't lie, people lie.

7/27/17

The Alset (ION.v) Scam: Eleven weeks and no news on the assays...

...that should have taken three weeks maximum to publish, and all the CEO of this scam, Allan Barry, can do is flap his lips on CEO.ca. Interestingly he'll talk all day and every day about anything except the crazy delay of the ION.v assays and my stars, he gets thin-skinned and delicate if you prod him on it too much the sweet snowflake. Good job he doesn't add to this standing joke by being drunk and abusive online in the evenings though; that would be a shame.

The performance of major gold mining companies, February 29th 2016 to date

  • Barrick (ABX) up 20%
  • Agnico Eagle (AEM) up 36%
  • Newmont (NEM) up 42%
  • Kinross (KGC) up 42%
  • Franco Nevada (FNV) up 21%
  • Royal Gold (RGLD) up 84%
We can even add these:
  • Gold and Silver Index (XAU) up 34%
  • Precious Metals ETF (GDX) up 18%
  • Gold bullion ETF (GLD) up 1%
And then, this:
  • Goldcorp (GG) down 10%
Fact: David Garofalo became CEO of Goldcorp on February 29th, 2016.

UPDATE: Reader 'DR' has a thought:

"...You highlighted Goldcorp's 10% drop on the blog today. You may be interested to see a summary of how their Yukon mine development project is progressing..."

UPDATE 2: David Garofalo on BNN today. Watch it here, but in three words it's "Everything Is Awesome". Utter bollocks. In the Q&A the BNN guys mention the call on the stock made this morning by Peter Ward of Renaissance Macro Research. Your humble scribe strongly agrees with Ward's call and FYI, here below is the front page of his note to clients out pre-open. Since this was published GG is down 7.1%, so work it out for yourself.

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

Goldcorp
Reiterate Underweight Rating – Cut Target to $12

We have been and remain negative on Goldcorp shares. The company reported a decent quarter that we suspect may have included some non-recurring gains such as a large tax benefit. Management will host a call later today to clarify.
As we have discussed, the company has committed to make a major investment in Cerro Casale – a low grade and very remote copper/gold project in Chile. In our opinion, the inclusion of Cerro Casale in “Proven & Probable” reserves reflects a shocking lack of conservatism. Yes, we realize Barrick and Kinross did so for many years. But, we expected better from Goldcorp given management’s acknowledgment that the project still needs years of study. The project has already been studied for over twenty years. We visited the property in 1996. The project was not advanced by previous owners during the last decade when gold prices exceeded $1700 per ounce and copper exceeded $4.00 per pound. Current prices are much lower. Therefore, it’s hard for us to discern what makes the project more attractive now. The challenges of a lack of infrastructure and shortage of water in the Atacama desert have not improved to our knowledge.
Our thesis is intact. We believe Goldcorp is depleting its high quality and low risk reserves. Therefore, GG’s earnings multiple should continue to contract. YTD, gold is up 9% and GG shares are down 7%. As we have said before, it is far too simplistic to view gold equities as merely levered plays on the commodity price. We continue to find attraction in a pair trade that is long gold and short shares of Goldcorp.

More TMAC news

It turns out that TMAC Resources (TMR.to) didn't just waste its money on one Python plant. They bought two. No news on whether they bothered to install the second once they realized the first one doesn't work.

7/26/17

TMAC Resources (TMR.to): The IKN First Law of Mining News Releases strikes again

On July 14th, we wondered out loud in this post just why TMAC Resources (TMR.to) had dropped just a modest 6% or so on the back of obviously bad news from its operation (aka Monty Python's Flying Metallurgy) and invoked the First Law of Mining NRs as evidence:
 "The IKN First Law of Mining News Releases: Considering that anything contained in a mining news release is presented in the best possible way for the company in question, any piece of information contained in a NR that comes across in any way negative means the real news and/or events behind it must be very, very bad indeed."

And since then?

 
And GDX is up 5% since July 14th, too.

Moral: Don't mess with the fundamental laws of nature.

Mailbag on FOMC

Reader 'CM' sums up the FOMC in twelve words and one photo:



The last six Fed meetings in one picture
Different shape, same content.




Nicely done, CM.