Mining and theTSX GroupThe TSX Group comprises of the Toronto Stock Exchange (TSX) and the TSX Venture Exchange (TSX.V). In terms of global ranking for equity capital the TSX Group places eighth. Mining is an important sector for the TSX Group. Or perhaps that would be better said in reverse. Over 50% of the world’s listed mining companies are with the TSX Group. (See the following link for further information)
As of 2004, the TSX has over 1,400 listed issuers of which 219 are mining companies representing 10% of the total market capitalization of the index. The TSX.V lists nearly 2000 issues of which 995 are mining companies. In terms of market capitalization this represented approximately 50% of the TSX.V.
Some of the applicable basic TSX requirements are to have at least one million freely tradable shares with an aggregate market value of C$4 million that are held by at least 300 public security holders each holding at least one board lot.
TSX.V requirements are less stringent. Only need 500,000 freely tradable shares held by at least 200 public security holders representing 20% of the issued and outstanding shares.
The TSX has three different listings standards for mining companies depending upon their stage of development: (1) mineral exploration and development-stage, (2) producer and (3) senior producer.
These criteria are listed below. (For further information see this link)
Mineral Exploration and Development-Stage Companies (eg. ARU-X)
1.) Property must at least demonstrate an economically interesting mineralization in three dimensions that is detailed in a report by an independent qualified person..
2.) Planned program of exploration and sufficient funds to complete that said exploration of at least C$750,000 that will advance the property and is recommended by an independent qualified person. This funding is detailed in a management-prepared 18-month projection by quarter of funding sources signed by the CFO.
3.) Working capital of at least C$2,000,000 and appropriate capital structure.
Net tangible assets of at least C$3 million.
Producing Mining Companies (eg. TKO-T)
1.) Demonstrated Proven & Probable Reserves as calculated by a qualified independent person to provide a mine life of at least 3 years.
2.) Sufficient funds to bring the mine into production with appropriate levels of working capital to fund operations. This funding is detailed in a management-prepared 18-month projection by quarter of funding sources signed by the CFO.
3.) Net tangible assets of at least C$4 million.
Senior Mining Companies (eg. GLG-T)
1.) Demonstrated Proven & Probable Reserves as calculated by a qualified independent person to provide a mine life of at least 3 years.
2.) Pre-tax profitability from the last fiscal year.
3.) Pre-tax cash flow of C$700,000 in the last fiscal year and an average pre-tax cash flow of at least C$500,000 for the last two fiscal years.
4.) Sufficient working capital to fund operations.
5.) Net tangible assets of at least C$7.5 million.