RE:Ganndolphs take on financialsNergy,
What is my take on the Orvana Fiscal Q1 2022 Results?
Most important is the reaction of market participants to the news. The big story is that new buyers are coming in and taking positions on an extremely undervalued stock, and the stock price movement higher has attracted more buying interest and that spells ORV momentum moving the stock higher
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If there is a buying panic to come into the precious metals sector which has been totally neglected and unloved forever, it is my opinion that Orvana Minerals is well positioned to take advantage of any positive change in investor sentiment. Based on the recent price action in ORV.to and ORVMF, it appears that the market thinks that Orvana Minerals will lead the charge when the buying panic into the precious metals stocks finally begins!
Orvana Minerals has the advantage of already being paid $4.89 USD per pound of copper concentrate sold based on the fiscal Q1 2022 MD&A and Orvana received $26 USD per ounce of silver price for 50,000 ounces of silver by product produced last quarter, well above the spot price of silver. So, Orvana Minerals has the advantage of having significant copper by product metal production and silver metal by product production at Orovalle in Spain.
The Orovalle operation generated $5.1 million dollars in cash flow which was enough to fully offset the care and maintenance cost of EMIPA in Bolivia totaling $1.238 million USD, the exploration costs at Taguas in Argentina of $0.764 million USD, and corporate overhead in Toronto of $1.263 million USD. So the FQ1 2022 net income after tax was $405,000 USD or about $0.003 USD per share. So Orvana is cash flow positive.
Next is the CEO’s response to the production interruption which occurred in Q4 2021. Orovalle kept mining throughout this time period when the process plant had to be shut down. Juan Gavidia went out and obtained a $16.3 million USD loan in Spain to ensure that Orovalle kept operating and at the end of the quarter had $9.578 million USD in cash available in Toronto to fund over 50 percent of the capital needed to start the OSP project in Bolivia. Smart move IMHO!
So with the recent price moves in the gold and silver price breaking out from a long period of consolidation, I expect Juan Gavidia to announce a positive decision on the OSP at EMIPA in the very near future. I also expect the production time schedule to be moved up accordingly.
ganndolph