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Jbay76 (< 20)

Aurcana Corp Quarterly Report and more...

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June 27, 2011 – Comments (9) | RELATED TICKERS: GPL , RBY , AUNFF

First, I have to give thanks to Sinch for my current holidng in this junior silver miner as I would not have foudn them without him.  And I have to say I really like this company!  Now, as you read this report and the link, bear in mind it is an unaudited fianancial report, so I am not sure how different it would be ifit was audited.  Having written that, check this:

The most significant highlights for the quarter ended March 31, 2011 were:

140% increase in net revenues to $10.9 million compared to $4.5 million for the first quarter of 2010;

Earnings from mining operations to $5.4 million compared to $0.7 million for the first quarter of 2010;

Operating cash flow before movements in working capital items, to $4.7 million (2010: deficit of $0.5 million);

A total of 127,231 milled tons compared to 79,007 tons for the first quarter of 2010. Of 127,231 tons, 14% (17,619 tons) were from NI 43-101 measured and indicated; 86% (109,612 tons) were from new discoveries. Increased production from 154,095 sliver ounces for the first quarter of 2010 to 240,275 silver ounces in 2011, an increase of 56%.

La Negra

61% increase in tons milled to 127,231 tons compared to 79,007 tons for the first quarter of 2010;

46% increase in copper concentrate produced to 2,994 tonnes compared to 2,053 tonnes for the first quarter of 2010;

56% increase in silver concentrate produced to 240,275 ounces compared to 154,095 ounces for the first quarter of 2010;70% increase in zinc concentrate produced to 1,582 tonnes compared to 933 tonnes for the first quarter of 2010.

Shafter

The Company started construction of the Shafter Silver mine project, 100% owned by the Company, after completing the equity financing on December 7, 2010. The Shafter feasibility study shows an estimated pay back of 1.9 years based on $15.53 per ounce of Silver and the construction is estimated to be completed by May 2012. (emphasis mine)


The Company wishes to advise its Technical Report dated November filed on SEDAR November 12, 2010 was revised on June 23, 2011 to correct the presentation of Table 18.2 wherein the table now reflects Measured, Indicated, Proven and Probable in separate columns with no changes to the summary totals. The Report may be found on www.sedar.com and the Company's website www.aurcana.com.

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My bold emphasis of the shafter mine is meant to draw attention to the fact tha silver is now trading at/around mid-30's, meaning that Aurcana can pay off the mine in 1/2 the time as they originally thought.  Plus, they bought back their rights from SLW, so their mines are 100% theirs!  The actual financials can be found at the hyperlink in the beginning of the post. One thign missing is the cash csot of the extraction, and overall operting costs for the quarter.  Guess I have to dig deeper for that one.

 

In other news, EXk has been downgraded by The Street.  So, in the time-honored tradition of doing the exact opposite as the market says, it's time to double down.

Rubicon just entered into an agreement with West Kirckland Mining whereby West Kirckland willput up a large chunk of change to explore the Long Canyon region in Nevada that is currently owned by RBY.  This is the same area where the former Fronteer Gold (now part of Newmont) made a name for itself.  This agreement allows RBY to focus on the Red Lake project while their other property explored at someone else's expense.  RBY will still hold onto a 49% chunk of the place as a result.

 

You'd think that these miners were botching something up good by the way Mr. Market is treating them. Well, if it goes on for a little while longer, it'll be cheapr for me to double down.  I like me these sales! 

9 Comments – Post Your Own

#1) On June 27, 2011 at 4:26 PM, EvilEmpire (29.83) wrote:

The only thing that bothers me about Aurcana is that they will soon have over 500 million shares outstanding. 

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#2) On June 27, 2011 at 4:32 PM, Jbay76 (< 20) wrote:

That is a good piont........but , unless I am mistaken, that is in large part how they were able to pay off SLW and get 100% rights to their mines.  Would you rather have many owners, large bank debts or not own 100% of your mine and the PM that comes out of it?

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#3) On June 27, 2011 at 5:16 PM, TSIF (99.96) wrote:

Shares outstanding is not a metric to value a company, in and of itself. True, the revenue gets spread across more shares, but book value, margins, and assets are still the same.  It does matter what they do with the money when they introduce new shares, and paying off SLW is better value in the long run.

Overall, I highly suspect we will see a 1 for 10 reverse split soon and the share price will be more appealing to larger investors and the share count reduced to a nice 50 Million or so. This is very typical for miners who raised funds at various steps along the way.

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#4) On June 27, 2011 at 6:33 PM, SN3165 (< 20) wrote:

Thanks for posting this. Aurcana and Caza gold are two stocks  i;ve got an eye on right now. :-)

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#5) On June 28, 2011 at 2:00 AM, awallejr (75.87) wrote:

I dunno, I picked it and it pretty much has gotten crushed since then ;/

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#6) On June 28, 2011 at 8:51 AM, Jbay76 (< 20) wrote:

I have real money on this company, and yeah, the share price has gone down, but their actions this year are setting them up to be very profitable down the road.  At some point, a company has to take debt in one form or another to develop their long-term projections.  Plus, these guys are junior miners, they'll be more volatile in the near term, which gives us the opp. to buy many shares on sale! :P.

 TSIF

I'd rather see them get listed in the American stock exchange rather than a 1 for 10 revese split.  I think that will also increase investor interest.  Regardless, these next 12-18 months will be potentially very rewarding! 

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#7) On June 28, 2011 at 9:30 AM, TSIF (99.96) wrote:

Unfortunately Jbay76, they probably aren't eligible for listing on a US stock exchange sub $1.00 and if they are they won't be picked up by many mutual funds who do have price threshholds.

A reverse split sometimes causes selling and sometimes causes buying. Overall, however, while a sub $1 stock price may make you feel richer with more shares, the net result is the same financially.  A US listing would be more valuable than a sub $1 stock price if it takes a reverse split to get there or to get some respect.

Good luck!

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#8) On June 28, 2011 at 9:33 AM, XMFSinchiruna (27.20) wrote:

awallejr

That "getting crushed" you've witnessed has been within the context of a fairly major sectorwide selloff (and a 33% retreat in the silver price from the recent peak)... be sure to account for that when assessing the stock's performance. Aurcana is not a core holding of mine, but what I have I intend to keep, and if it dips much further I intend to target some dollar-cost averaging.

Jbay76

Awesome post! I can't accept credit for Aurcana, though ...CAPS member speedybure brought the company to my attention around the beginning of this year, and I was amazed I had never heard of it. I continue to be amazed that after all this time eating and breathing this pm market there are plentiful new names coming across my plate. At some point, a Fool needs to accept that he/she is only one person, and limit the size of the galaxy of stocks he/she will track closely within the universe of companies out there.

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#9) On June 28, 2011 at 12:50 PM, Jbay76 (< 20) wrote:

Sinch,

Thanks, it's nice to hear your comments, it means I'm maturing, though I won't specualte as to the rate :) I could definitely improve my typing though.

Nonetheless, thanks to Speedybure then, for bringing Aurcana to the Fooldom.  I read his articles a lot in SA, and he has also helped my learning curve.

TSIF

You're absolutely right, they woudl have to be north of $1.00 US to get listed, and you're right on the fact that regardless of a reverse split or not, the total value of ones AUNFF portfolio remains the same, but I like looking at a lot of shares and thinking how sweet it would be if they wait it out for a year or two until their stock is north of $1 USD and then get listed instead of doing a revese split now.  So far, it seems like they are doing fine and do not need to do that yet.....time well tell

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