Email request for update from Economo - no reply I sent this email to Economo on 3 March 2017...and have chased for a response since...without any luck. I cannot fathom a CEO who so ignores shareholders.
Dear Mr Economo, I am a UK based retail investor in Focus since mid 2011 having acquired over 200,000 shares via nominee accounts. I believe I have a fair understanding as to the trajectory of mining projects having invested in a mix of challenging resource segments from rare earths to lithium, cobalt to oil shale as well as base metals and oil/gas e&p plays. I have long been a believer in the graphite sector and have kept faith heretofore with Focus management's representations that Lac Knife is "the most advanced battery grade graphite project in North America". In addition to a world class resource position, the Company has long claimed a unique technology hedge in the sector derived from its significant investment in and affiliation with Grafoid. And yet, the Company's share price performance has been woeful. We all recognise the macro factors which have undermined the mining sector in recent years....but 2016 witnessed a turnaround, particularly for lithium and graphene segments. But Focus has not participated in the positive shift in sentiment. For my part, I am beginning to feel that Shareholders are being prejudiced by deficiencies in management's approach...possibly down to poor strategic execution, or if this assessment is unfair, then by a lack of timely information about the Company's financial management, project execution and forward progress. I don't think Shareholders have adequate visibility of what management is doing today to achieve the Company's business goals and investment objectives. The website and company presentations are not updated consistently....and news flow is in my view rather spotty. Focus has not attracted any serious analyst coverage. I have read MANAGEMENT’S DISCUSSION AND ANALYSIS For the years ended September 30 2016 which I note was completed at the end of January 2017. The note highlighted, inter-alia, another Going Concern warning as evidenced by the Company's liquidity risk profile characterised by its ongoing working capital deficiency and net indebtedness position. I note Management's success in executing the 3 post balance sheet flow-through placements totaling over $1.7m. But these stop-gap financings would not appear sufficient to address net liabilities falling due in 2017, let alone advance the Lac Knife project? I am concerned that if Focus was truly seen by the market as having made 'steady progress in building a de-risked investment for retail/strategic investors' etc, why then has management failed to properly capitalise upon the Company's intrinsic value? Why do we not compare more favourably to a company such as Mason Graphite who are executing a comparable strategy....yet appear to be doing in a more assured manner which is generating real shareholder value along the way? There presentations instil confidence. Absent a more substantial Focus financing strategy, I read that Management has considered the following funding routes:
1. Potential sale of part of the Company’s equity position in Grafoid Inc (Focus holds 7.8 million shares) 2. Potential sale of part or all of the Company’s 2,500,000 shares in Mincom Capital Inc. 3. Potential sale or option of the Company’s non-graphite related assets including the Eastmain-Lran/Alta Option and Eastmain-Lran Polymetallic properties in the James Bay territory of northern Qubec. So where do these options stand today? 1. What has happened to the Xiamen Tungsten MOU to acquire 20% stake in Grafoid which was signed nearly a year ago?
2. What value do you attribute to the Mincom shareholding today? I gather the Mincom shares remain suspended and are virtually worthless. NB: the year end report stated that Focus "received 2,500,000 common shares in Mincom, valued at $450,000" but I recall that the when the deal was announced in 2014 it referred to "the issuance of 2,500,000 Mincom common shares to Focus at a deemed price of $0.30 per share for a total of $750,000". What is the actual impairment incurred by Focus todate?
I would welcome any clarification you may be able to offer to the points raised above and otherwise hope that all Shareholders will benefit from improved Corporate communications very shortly.
Cheers,
Gregg Egen
73 Hillway, London N6 6AB
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