June 30 reality check February 24, 2021 news release: "Net proceeds from the Offering will be used to continue exploration activities at the Company’s flagship Kobada Gold Project with a view on targeting an increase in resources and reserves in the near term."
That was February. More than 4 months ago.
April 2021 presentation, page 9: "
By far the greatest potential to increase valuation is to continue to drill shear zone structures... 3 key target areas for 2021"
So how is the drilling going on those 3 key target areas? Did I miss some news about drilling?
More from the same page of the presentation, which has not been updated: "
Target is 1 million ounce reserve by Q2-2021"
How many minutes are remaining in Q2 to at least start work on the drilling?
April 14, 2021 news release: "the Company has received board approval to initiate an update to the
July 2020 Definitive Feasibility Study (“
DFS”) with the goal of increasing the production profile and overall project economics beyond the robust results of the previous DFS. ... The updated study requires significant work as we will need to review resources and reserves, an updated mine optimisation and schedule, additional refinements to the processing plant and a larger tailings dam. In addition, we will work through the updates to the ESIA. ... The update of the DFS is the next step in our programme to continue to increase the value and free cash flow in this project."
Note there is NO MENTION OF DRILLING as one of the activities needed for the DFS update.
So sometime between the April 2021 presentation, and the April 14 2021 news release, it looks like the company has decided that (a) drilling to increase reserves is not a priority after all; and (b) they feel better about 'advancing the project' by having consultants massage the numbers one more time, and preparing a new story to tell.
And how is that 'significant work' going since April - whether on drilling, or on updating the DFS? No news. Nothing, zero, rien du tout.
Hence the share price continuing its 10 year downward trend.
The title of the April presentation is "A Transformational Year" (presumably talking about 2021, but you never know with AGG). Based on the first half of the year, what kind of transformation would you bet on for the second half?
This is a 100% classic lifestyle company. Unfortunately, owning AGG shares does not entitle the shareholders to a share of that lifestyle.