ORV.T Orvana At a market cap of $30 million and cash as of March 30 of $15 Million, you get a company that fits my favorite recipe of solid company with solid assets, solid past, that is in the doghouse now, but with a solid achievable plan to come out swinging. One drawback for me, is the under ground producing mine, El Valley is in Bolivia, but that ding is priced in by a large margin already and I'm willing to accept the risk.
Orvana is a recent 135KAuEq low cost producer, that paid back $70M worth of loans during the recent bad years. Its for this reason and the POG, things are in rough shape and Orvanas underground development has suffered as they didn't have the cash to keep it up and thereby the reason for the drop in production.
Orvana recently got a $7.98M secured financing, that was secured by a major Bolivian bank. The plan is to reinitialize production at the Don Mario CIL circuit in Spain, at a different location where they have done metallurgical testing that will offer better recoveries and lower costs than previous south area, (interesting side note, I crossed paths at the DNI Metals facility Lab where Orvana was doing this work). The project has a CAPEX near $6.4mil and long lead tme equip was ordered in April for an expected finish time of 7 - 9 mths, or later this year.
As to El Valley, they have water, electricity and ventilation issues to deal with, and basically just need to rehab the underground.
Total 2016 CAPEX for both projects is between $18M and $20M. They have $15m cash and the latest $8m financing. Also weighing in is the fact, they have less production than before and need to keep up on the drilling.
They have gotten the plan. All in all, you could be buying a future 150k producer, with 2 producing mines, plenty of exploration upside, for next to nothing now. Place your bets, as to weather they can get things put together like they say. The risk reward ratio was to compelling for me to pass up. Ive been buying since the high teens and have even averaged up today. This company was well liked by Chen and maybe Bobwins in the past, and more recently in the last year commented by DrAir. Dont know where they stand now but hopefully their on board even if by legacy shares.
PS almost forgot, Orvana made some interesting board changes recently where they reduced the directors from 9 to 5. That change saves Orvana shareholders $419,000 USD in extra management overhead and with the CFO doing extra work as Interim CEO that saves another $838,000 in management overhead. Gets more interesting, two new former USA silver director now sit with ORV. Gordon Pridham Former chairman of US Gold and Silver, now Americas Silver is in charge of Orvana's strategic planning.
Alan Edwards, also from USA, is a professional mining engineer who also has an MBA.
HUMMMM Could Mr. Edwards has been sent to scope out the value of Orvana as a possible USA merger target? Combining the 2 would make a 2 mine USA Silver with $15M cash injection, or USA Silver mgt has done a good job cutting head count and labor costs while keeping up production, maybe they are doing the same here?
Checkmate28 GLTA
