Thought tonight I would write an overview / summary of Firefinch LTD (FFX) in simple terms that an average investor, like myself, can easily understand ... Do keep in mind that this is not intended to be an extended analysis of the company, so if you are a Long Term Investor, you will know all this already so please feel to disregard its contents
Disclosure: I am not a professional investor, nor am I a Geologist. There is a lot of jargon to decipher, a lot of maths to calculate and just too much information causing “Analysis Paralysis”, so it is with this summary that I can hopefully have all my research here in one place under one roof, outlined in a format that I can easily follow (as a potential investor), and in words that I can understand (and you) … And please feel free to provide some constructive criticism if you see I have made any errors or if you have any constructive input which can add to what I have already included
Second disclosure: I am a compulsive user of smilies and much if this content is copied and pasted from various sources
HOLY MOLY... (I'm going to jump the gun a bit here, but this got me very excited)!!!
Before I even began to start my research, and as I usually do, I went straight to the investor section of FFX's website to be surprised by a section called 'Top 20 Shareholders"... This has got my heart pumping!!
NOT MANY asx stocks provide their shareholders with such valuable information (especially on a monthly basis)...
Now I am excited to continue to my research... And why you might ask?
It is my opinion, that only the real ASX companies with a management who truly believe in the future growth / potential and success of their company do they provide such vital investment resources to its shareholders... Others just hide behind the ASX rules and provide this information in Annual reports when they are required by the ASX to do so, as you can see from my email below in which the board was surprised that many of my companies that I invest in provide their shareholders with such valuable information...
Ok, so now I am excited to continue my research Let's just say, this tells me a lot about the Management Team of FFX, and I haven't even started my research.
So what is Firefinch and what do they do?
Firefinch Ltd is an ASX-listed gold producer and lithium developer based in Mali advancing two cornerstone assets – the Morila Gold Mine and the Goulamina Lithium Project.
The Morila Gold Mine (80% interest) has produced 7.5 million ounces of gold since 2000 and has historically been one of the highest grade gold mines in the world. The Company’s mission is to increase gold production (currently 40,000 ounces from tailing treatment) via open pit mining from Morila’s main large pit, its satellite pits and the Company’s Koting discovery on its adjacent Massigui Project. Exploration will be a major focus at Morila, with multiple high-priority targets on the 685km2 of surrounding tenure.
Additionally, the Company owns the Dankassa Gold Project. The Goulamina Lithium Project is one of the world’s largest undeveloped deposits and has the potential to be one of the lowest cost producers. All permits are in place, a Definitive Feasibility Study is complete and a Global Resource of 109 million tonnes at 1.45% Li2O with 1.57 million tonnes of contained Li2O has been declared.
Firefinch is a responsible miner. The company endeavours to make a difference to our local communities on multiple levels – by providing a safe and rewarding workplace, following best environmental practices and contributing economic benefits regionally by employing and expanding locally.
Ok, so this was taken directly from the website, but it is a good summary of what the company does
So let's break it down...
Morila Gold Mine:
Firefinch has an 80% interest in the Morila Gold Mine which has produced 7.5 million ounces of gold since 2000 and has historically been one of the highest grade gold mines in the world under previous Barrick Gold and Anglogold Ashanti ownership.
Who owns the other 20% you might ask? The Mali Government!!! - I would say that this gives the Mali Govt (and its "people") some incentive to see this project prosper
Since acquiring the mine from the majors, the company has been ramping up production through its 4.5mtpa mill, from a current annual production profile of 40,000 ounces from tailings treatment, towards a target of 80,000 ounces per annum from mining the smaller, satellite open pits, stockpiles and tailings.
In 2022, the company plans to further increase production by re-commencing mining from the main Morila pit to exploit the 1.49 million ounce global resource at the project.
Exploration will be a major focus at Morila, with multiple high-priority targets on the 685km2 of surrounding tenure.
Morila was one of the world’s highest grade open pits 12 to 20 years ago but its limits are not well understood. Exploration is a major focus at Morila, its satellite resources and multiple targets on the 685km2 of surrounding tenure.
WITH, 20 years of continuous gold production plus all infrastructure required of remote mine provides confidence in the asset.
On 03rd May, FFX announced "Global Mineral Resources at Morila now total 2.43 million ounces of contained gold, including 1.31 million ounces in the Measured and Indicated categories" following intensive drilling campaigns...
And what did Michael have to say about this?
As of 13 May, we get another announcement regarding "Commencement of Open Pit Mining Operations"
"Mining is underway at Morila Pit 5, a mining area located on the western margin of the Morila Super Pit. Malian owned and operated contractor EGTF have mobilised a new 100 tonne class fleet, completed all mining preparatory works including re-establishment of the haul road to the crushers, and commenced mining and haulage to the crusher run of mine (RoM) stockpiles.
Currently, at Pit 5 alone, we have:
"Morila Pit 5 has an Indicated and Inferred Mineral Resource of 840,000 tonnes at 1.1g/t and Ore Reserves have not been declared. An Ore Reserve estimate will be disclosed once current drilling has been incorporated into an upgraded Mineral Resource Estimate"
One thing that stands out to me, even after such very basic research, is that Andrew and team are not mucking around!!! We all know what this means to the upside of the SP
They are GETTING THINGS DONE
Please don't skyrocket on Monday before I can Invest
Ok, so what about our Goulamina Lithium Project?
The Goulamina Lithium Project comprises a land holding of 100 km2 covering highly prospective hard rock lithium pegmatites in the Bougouni Region of southern Mali, approximately 150km by road from Mali’s capital, Bamako.
The Definitive Feasibility Study (DFS) described a compelling long life, large-scale, hard rock open pit lithium mine in Mali, West Africa. It confirms that the project is one of the world’s best hard rock lithium assets, especially in terms of scale and cost of production when compared to current operations and prospective projects, delivering outstanding returns with a pre-tax NPV of A$1.7 billion.
A key advantage is the quality of the 6% Li2O spodumene concentrate (SC6) product, being high in grade and very low in iron and mica impurities.
Goulamina is simple and robust, with high grades and low strip ratios enhancing financial performance. The Project delivers outstanding returns and, unlike peers, delivers good returns even at todays depressed lithium prices. The Project is not dependant on credits from other minerals. There is considerable potential to increase the size of open pit Mineral Resources and Ore Reserves through infill and extension drilling. These characteristics make Goulamina an important strategic asset for the world’s growing demand for lithium.
The Goulamina Lithium Project is one of the world’s largest undeveloped deposits and has the potential to be one of the lowest cost producers. All permits are in place, a Definitive Feasibility Study is complete and a Global Resource of 109 million tonnes at 1.45% Li2O with 1.57 million tonnes of contained Li2O has been declared comprising, 8.4Mt at 1.57% Li₂O in the Measured category, 56.2 Mt at 1.48% Li₂O in the Indicated category and 43.9Mt at 1.45% Li₂O in the Inferred category. Firefinch intends to demerge Goulamina into a new ASX listed Company and is conducting a process to investigate partnering, offtake and financing options for the Project.
Oh boy, add this to Morila, and what do we have?
* Sorry, the smilies show you exactly how I feel as I am typing
Ok, so we know the projects (in very basic terms), so now I want to take a quick peek at Management and their "skin in the game" ....
Currently, as of this May 11, the Top 20 Holders own a WHOPPING 37.84% of the company... This is huge !!
This is from a total SOI of 783,142, 641, which at todays closing price of 43 cents, puts us at only MC of $336 Mil!!
So who is in our management?
I will leave their backgrounds to another day, but I am interested in how invested they are themselves into FFX
This id quite a substantial holding, although not as much as I would like to see... I will look into this in more depth over the coming days... According to the amount of shares owned by Alistair, this would put him in approx 16-17th plave in the top 20... (I haven't considered performance rights etc... ) This requires hours of research and will follow
But I must say I like to see a Top 20 list with HIGH CONVICTION investors owning almost 40% of the company...!!
Appreciate if anybody can add to my very basic research here regarding Managements holding in the company
Another thing I love about FFX:
I really wish I bought some st 14.5 cents when I was recommended this stock
But even in the mid 30's -40's, I still see SIGNIFICANT upside for a Long Term investment...
Very much looking forward to all of your contributions to help me better understand FFX ...
Cari
FFX Price at posting:
43.0¢ Sentiment: Buy Disclosure: Not Held
(and you) … And please feel free to provide some constructive criticism if you see I have made any errors or if you have any constructive input which can add to what I have already included
Let's just say, this tells me a lot about the Management Team of FFX, and I haven't even started my research.
(20min delay)