FCR – Musings

I decided to take a look at Myles (Miles) Campion on Linkedin to see if there was any information that could prove useful.

He has recently updated his profile to show the following:

Executive Director

Company Name Ferrum Crescent Limited

Dates Employed Nov 2017 – Present

Employment Duration 3 mos

Ferrum Crescent is a [1] European explorer/developer, [2] based out of London and quoted on both the [3] AIM and the ASX, we are focused on the Toral Pb/Zn deposit in northern Spain. The deposit currently has a large database of over 44,000m of drilling covering a strike extent of over 3.5km and extends to a depth of 800m, [4] it has expansion possibilities both down dip and along strike.

Current work is ongoing to define a maiden JORC resource to supply a platform for [5] further exploration and evaluation of the deposit and to define the [6] opportunity that exists within the Toral deposit.

I have added the [] for ease. My ‘interpretation’ or ‘guess’ 🙂 on this linkedin entry FWIW is

[1] – it is no longer an Australia explorer – it’s roots are now in Europe – and longer term not just Spain. It is also a developer – which shows intent to move to production in the future – this is where the big bucks are!

[2] – I expect the head office to move to London and for  future GM’s to also be based in London , I expect office Admin to move to London – except where outsourced e.g. Company Secretarial duties.

[3] AIM and ASX but no mention of JSE. Interesting but not surprising. Probably some way off but at some point I reckon FCR will de-list from the JSE and close down any other costs associated with RSA.

[4] The JORC 2012 is just the beginning. Looks like FCR expect the asset to be much bigger – the statement is quite affirmative – which is great news and ties in with Colin Bird’s comments 

[5] Reinforces [4]

[6] Defining the opportunity –  I see as FCR looking for a way to move it along the stages required to get it to production.

And then..

Over the last few weeks we have had two great days, and some minor pull back. I call that healthy market mechanics. The first jump was prior to the announcement that Colin Bird would become chairman. I doubt all the market knew that was happening but some momentum guys probably jumped on board the rising tide in any case. However if the reason for the increase was purely leakage of CB’s appointment then it would indicate the market overall showing strong approval – for me it never is one reason so I’ll reserve judgement.

We are of course still waiting for the JORC 2012 which Laurence squawked ‘‘Work with our independent geological consultant remains on track to produce our maiden JORC 2012 resource on the Toral project.’ On track means by 31st January. If this slips a tad I’ll groan but will not be too concerned. I am sure there are some market participant who might get annoyed/emotional etc which could present an opportunity, markets are, after all, a way of transferring wealth from the impatient to the patient. Apparently. Thinking about it – maybe that’s why they will be annoyed / emotional – crafty!

DYOR. All IMO. GLA.

FCR – A quck view on the SP

As can be seen below, I am not a Technical Analyst. I am only interested in support, resistance, sometimes key moving averages, and peer comparisons – fundamental stuff. I am more interested in scenario’s – the what if’s – short through to long term.

The recent rise will be due to several different factors. There is never one simple reason. Ever. In my opinion the key ones are:

 

  1. Recognition that FCR has longevity – the rush for the exit in the past was due to shareholders being fearful of the future
  2. Colin Bird coming on board as Chairman – it seems that more people approve than disapprove. I approve BTW.
  3. Miles Campion’s credentials – geologist, fund manager, he knows full well what he has in the palm of his hand at present, and believes in the asset.
  4. Cash – two placings in short succession has raised a chunk of money, there is no debt, the execs have deferred salaries, and this sends a good message to the market
  5. TR1’s – several recently, post the resignation of JT – and the price has started its price recovery since the resignation.
  6. The Asset – In comparison with its peers it is well placed in terms of tonnage and grade and its Spanish location with well supported infrastructure and well understood mining laws.
  7. Lot’s of speculators waiting for others to move first to give validity to their thought processes
  8. Zinc – it continues to climb in price which gets it on the radar of the institutions, and mining consolidators who want to acquire assets – this is as much a short term play as a medium and long term play – great for those wanting baggers.

The asset is very valuable. FCR was fortunate to get it. It’s a funny old world. But this could be the making of a decent sized mining company and the spring board to much more.

All IMO. DYOR. GLA.

FCR – a very good week – but much further to go

The market was going to turn at some point, and turn it did! Some such as ‘Docholiday’ described the turnaround this week as ‘simple  market mechanics’ and I agree.

When a share has been battered by poor sentiment for so long, when shareholders worry whether the company will exist, then never mind the asset they have, there will be a rush for the door and the price plummets. Those who have not exited will be annoyed and frustrated.

However, some interesting things have been happening, and the appointment of Miles Campion, the departure of Justin Tooth, and then the injection of cash by Colin Bird, and the scene was already set for CB to become Chairman imo and for the turnaround to begin.

More importantly, with the soundings coming out about the quality of the asset, and some simple joining of the dots before the JORC 2012 is released, the writing was on the wall and it said ‘recovery play’. Just my opinion.

So now we have CB appointed as chairman, and an interview on Vox markets yesterday, are there any more dots to join at this early stage?

Well, I think so, and here us my interpretation FWIW.

The announcement said :

“I am pleased to be joining Ferrum Crescent which is a highly focused company with a developing European lead zinc portfolio. The management team has a highly motivated approach to the Spanish lead Zinc Toral project, which is a project with [1] strong underlying fundamentals and [2]  numerous upside potential. Additionally I perceive a European renaissance in base metal mining and the team is [3] well equipped to search out, acquire and develop European base metal opportunities.”

I have [] the key stand-outs for me and my reading of the comment.

[1] – the existing NI 43-101 is strong, but the JORC 2012 will help us understand how strong (Note: within the next 13 trading days the JORC 2012 is expected to be announced to the market.)

[2] – this is interesting, and is best explained in the Vox podcast which I see as further potential at Toral in terms of size of asset in addition to the JORC 2012 – bear with me as the Vox podcast talks about possible expansion at the Toral site

[3] – FCR is a likely become a key vehicle for building further company interests throughout Europe – this is a longer strategic view imo – which requires Toral to deliver first. Lago second? And then Third? This now requires FCR to move at pace.

Vox Podcast

Then we go to yesterday’s podcast, and after playing multiple times looking for a few clues in CB’s comments such as:

  • A company with a great advanced major project (Toral)
  • Driven colleagues [Miles & Laurence]
  • Talk of silver mentioned 2 times
  • Immense upside [for the asset and for FCR]
  • Right decision, right place, right time [yes!]
  • Huge database backing, not fully interpreted, but modern technology allows improved faster analysis, with Miles Campion into the detail [Hurrah – let’s focus on one thing!]
  • Miles – geologist – fund manager – ability to analyse and an ability to commercialise, and impressed with his plan formulation [back to the interview with Miles]
  • Chief Executive Laurence (? news to me ?)
  • Toral ‘Open ended to the east, and potentially to the south’ [Even bigger asset than that analysed to date?]
  • ‘Joy to be buying a ticket when it’s a micro cap’ [That’s why I am here!]
  • The cost of buying [via drilling etc.] the database [alone] , and the market cap, are misaligned [The cost to drill and analyse this asset over many years must have been very large for sure]
  • Internally convinced it’s a much bigger ‘animal’ than one sees [we heard you Colin :-)]
  • [Market Capitalisation] Value is related to size, grade, contained metal
  • Next 2-3 years – disconnect between demand and supply – junior mining sectors, 2018, 2019 will attract more money into the sector, and already seeing signs of institutions [investment] coming back
  • Sees FCR having good institutional support in the future [if it’s as big as you are hinting at then yes!]
  • Zinc Lead in a country with transparent legislation. Spain a joy, mining legislation is well understood and well conducted [and great beer and Tapas :-)]

CB Reasons to follow:

  1. A large deposit, with opportunity to be much larger and attractive to the trade
  2. A large database not yet fully interrogated
  3. Transparent jurisdiction – good for the portfolio short and long term

In addition, Laurence Read posted on VOX 12/1/2018

  1. ‘Next stage of our transformation of FCR [is] to focus on exploration and transactional value. I have followed Colin’s companies for the whole of my career in mining and he brings a rare skill set; exploration and development linked to commercial realisation ‘
  2. ‘Work with our independent geological consultant remains on track to produce our maiden JORC 2012 resource on the Toral project. Apologies to shareholders but just to be clear (and fair) on everyone I can’t give individuals guidance on size, grade and the silver- you will have to wait for the fully accredited report.’
  3. ‘Following release of [the] JORC report on Toral we shall also be talking about peer comparisons on a project level, and looking at what our (your) project looks like in the context of listed companies’.

Overall Interpretation

  1. High probability there will be a silver credit in the JORC 2012 – this helps project economics
  2. High probability the JORC 2012 will show a larger asset, and higher grade than the NI 43-101
  3. Very high probability there will be commentary around potential asset expansion at Toral – which would imply more tonnage, more metal in the ground etc
  4. Very high probability there will soon be commentary and management support to get the share price moving North [Peer comparisons to show how undervalued we are], along with various presentations on the FCR roadmap – how we get to move to production
  5. Very high probability there will be an up-tick in market commentary and market institutional awareness

I am looking forward to 2018 with FCR, we are at the very start of a long runway and multi-bagging capability from the off. There will be up’s and down’s but the trend is now our friend…

DYOR. ALL IMO. GLA.