Ok, here are a few key takeaways from my 30-minute meeting with Dan yesterday in Beaver Creek.
He’s a good communicator, comes across as likable and sincere. He said FF is his largest position in personal portfolio. One of the reasons he took the job at FF was b/c he had prior knowledge of our high quality assets from his time at Pacific Road Capital.
He is seeing a significant increase in interest in FF. Has 45 meetings in Beaver Creek with both individual and institutional investors. Flew in to Denver from NY yesterday where he was meeting with investors there. More meetings in Denver after Beaver Creek Summit is over. He and Mal both said their calendars are pretty much completely full and significantly busier than any point in Dan's 9 months on the job.
He knows very well that the stock price under performance is causing angst within their shareholder community. He said he believes the share price is STILL “working through” the GDXJ liquidation and resulting arbitrage. He said it takes “real work” to advance projects at this stage. That real work is a combination of things that take time & money. There are additional things he wishes he could do (my assumption was he was referring to Goldlund) but he must prioritize based on available capital. He talked a lot about Springpole, sounds to me like he wants the market to believe MGMT has 100% intention of developing Springpole ourselves. Expects Springpole EIS to be submitted late 2020 or early 2021 followed by 18-24 months process for permit. Sees no major reasons why we won’t get permitted at Springpole.
I asked him if he is funded through 2020 and he said no. I asked what his “preferred” option would be to fund the 2020 initiatives and he said a strategic partnership where a company comes in and buys 9.9% or 19.9% of the company. ***I wish I would’ve inquired more about that comment but he was talking fast and I was focused on other points of the conversation***. Other funding options are to sell royalties/options for the lower tiered properties and of course, using the At-the-Market Facility. He commented that they are sensitive to further dilution and they don’t want to sell treasury shares into the market at these depressed prices. He made a comment that we have a bit of a weird piecemeal portfolio and that it’s hard to articulate the value proposition of the portfolio in 20 minute investor meetings. Although he didn’t say it, I took that to mean he would like to sell off some of the tier 2/3 properties.
When I asked what he thinks it will take for the company to really take off, he said a sustained level of higher gold prices. He said he thinks the recent rise in gold price is coming from fear and not greed. When it reaches the greed phase, it will drive investment to the juniors.
He said if you’re looking for the single most important binary event for the company, it would be getting permitted at Springpole.
He said he believes they have a new “gold district” at Goldlund. Miller drill results coming soon.
Updated Springpole PEA coming in the Fall.
He said a 4x rise in stock price simply reverts to the mean.
Quick conclusion, my opinion is that Dan wants the investment community to understand FF is ready to play the long-game. I came away with the impression that there is no way they will F up what they have with Springpole and Goldlund. All the other properties are probably fair game to be used in whatever way they can to finance/advance the Tier 1 initiatives. They have clearly heard investors concerns about not doing enough on the PR side and are working to move upstream with more reputable distribution channels. Mal was very professional and appears to be sincere about doing everything she can to further that goal.
I came away seeing no glaring red flags. Probably gonna take more time to play out as we’ve all discussed ad nauseam. Hope this is helpful info.
