Q3 2024 United States Antimony Corp Earnings Call
and here's what's new.
Speaker Change: Good afternoon ladies and gentlemen. Please remain on the line. Your conference will begin in just a few moments. Please remain on the line. Your conference will begin in just a few moments.
Speaker Change: Greetings. Welcome to the United States Antimony Corporation third quarter and nine months ended September 30, 2024, operating and financial results meeting webcast. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation.
Speaker Change: If anyone should require operator assistance during the webcast, please press star zero on your telephone keypad.
Speaker Change: Please note that this webcast is being recorded. I will now turn the webcast over to your host, Gary C. Evans. You may begin.
Speaker Change: Thank you and thank all of you for listening to the companies.
Speaker Change: third quarter and nine months ending 930 operational and financial conference call.
Speaker Change: I've got a number of other management members with me today that will be speaking, Joe Bardswich who's a director and a co-CEO with me.
Speaker Change: Rick Isaak, our Senior Vice President and Chief Financial Officer, and Jonathan Miller, our Vice President of Investor Relations and Global Sales Manager.
Speaker Change: I think we'll start out by letting Rick go over the financials that were reported on our press release this morning, and I believe we just filed the Form 10-Q, which will give you a lot more detailed information. Rick, do you want to start out?
Sure, sure. Thanks, Gary.
Rick Isaak: I'm going to review our consolidated results, and then a few metrics of each of our businesses, and then a few key areas in our balance sheet and cash flow.
Rick Isaak: So I'll start with the consolidated results of our continuing operations.
Rick Isaak: Sales were $8.1 million for the first nine months of this year, which is an increase of 23% compared to last year.
Rick Isaak: This increase was primarily related to higher antimony sales volume with higher demand.
Rick Isaak: and to a lesser extent higher zeolite sales volume and sales price.
Rick Isaak: Last year's zeolite price increase became effective in stages towards the end of 2023.
Rick Isaak: Gross profit was 2.2 million dollars for the first nine months of this year, which is an increase of a hundred and seven percent over last year.
Rick Isaak: This increase was primarily due to improved efficiencies with the higher volume, partially offset by more maintenance and other related costs with our ZOI business, which I'll talk more about later.
Rick Isaak: Operating expenses were 3.3 million dollars for the first nine months of 2024, an increase of 1.8 million dollars compared to 2023.
Rick Isaak: This increase was primarily related to about $454,000 of non-cash stock compensation expense.
$446,000 of project costs.
$482,000 of salary and board fee expenses.
Rick Isaak: and $90,000 of SEC and annual meeting costs that were incurred earlier this year but not until the fourth quarter of last year.
Rick Isaak: The $446,000 of project expenses relate to the improvement initiatives that we've been discussing throughout this year, including purchasing mining claims in Alaska and Canada.
the SEC technical report for BRZ,
potential acquisitions, and government sales and funding efforts.
Rick Isaak: Next let's review a few metrics related to each of our businesses. First, our antimony business.
Rick Isaak: Sales from our Antimony business for the first nine months of this year increased by 24% over the prior year and gross profit more than doubled last year's gross profit.
Rick Isaak: The gross profit and gross margins we're achieving this year are higher compared to last year due to efficiencies with the higher sales volume and a great experienced team running our facility in Montana.
Rick Isaak: who have continued to efficiently produce high-quality products year after year.
Rick Isaak: Our average antimony sales price per pound for the first nine months of this year was $4.73.
Rick Isaak: which is low compared to the market price, primarily due to two factors.
Rick Isaak: First, nearly a third of our sales this year relate to the processing of customer-owned ore into antimony metal, which is a process called tolling.
Rick Isaak: This lowered our average sales price per pound, but still had a nice return, as you can see with our results.
Speaker Change: If you remove sales from tolling, are sales price per pound increased in line with the increase in the market price similar to prior years?
Speaker Change: In addition, our anemone supplier had a planned shutdown for two months from mid-May to mid-July of 2024, which lowered our anemone sales in the third quarter of 2024.
Speaker Change: and lowered our average sales price per pound with a higher concentration of tolling sales.
Speaker Change: We're now seeing some bump at the beginning of the fourth quarter.
Next, our zeolite business.
Speaker Change: Sales from our Z-Lab business for the first nine months of this year increased by 17% over the prior year. Gross profit decreased by $255,000 compared to last year and loss from operations was worse by $562,000.
Speaker Change: We continued to enhance the operations of our Zeolite business during the third quarter of 2024.
Speaker Change: This included improvements in our production processes, safety, and equipment at the facility.
Speaker Change: which has led to higher product throughput, improved customer delivery timing, a safer working environment, and increased production reliability and run time.
Speaker Change: These improvements are the result of the high-caliber team we have at our ZLI facility.
Speaker Change: However, this progress came with a cost, which can be seen in the zeolite segment results, with increased maintenance and other related costs, and increased operational losses.
Speaker Change: These operational improvements and the related costs should begin to decrease in future quarters.
Speaker Change: During the third quarter we also substantially increased our supply of material from our zeolite mine to continue timely delivery of product to our customers.
Speaker Change: and we saw some increased sales volume in the animal feed sector. Overall, these improvements at our Bear River Zeolite facility allow us to grow our zeolite business, which hasn't happened in prior years.
Thank you.
Speaker Change: Next, our subsidiary in Mexico. As we've discussed on prior calls, we closed and discontinued our operations in Mexico on March 11, 2024.
Speaker Change: During the first nine months of this year, we sold some of the antimony inventory in Mexico, which generated $1.2 million of revenue.
Speaker Change: However, even with these higher sales and the closure, our discontinued operations in Mexico still generated a loss of $195,000 for the first nine months of this year.
Speaker Change: Alright, next, let's go through a few balance sheet and cash flow items.
We stabilized or improved our working capital levels comparatively.
including in inventory receivables and payables.
Speaker Change: Our anemone supplier had a planned shutdown, as I mentioned earlier.
Speaker Change: As a result, vendor payables increased with increased shipments from them later in the third quarter.
Speaker Change: Our cash and cash equivalents balance of September 30th, 2024 was $12.97 million, which is an increase of $1.1 million from December 31st, 2023.
Speaker Change: Overall, we accomplished a lot in the third quarter. We purchased mineral claims in Canada and Alaska, continue to make progress in our SEC technical report summary on our zeolite reserves in Idaho.
Speaker Change: sold our residential home in Idaho, continue to meet with government officials in various departments of the U.S. government regarding sales and funding of antimony, zeolite, and other minerals.
Speaker Change: contacted many international suppliers of antimony ore to purchase ore and are starting to see some samples and executed a lease for the operation and use of a metals concentration facility in Phillipsburg, Montana.
Speaker Change: We will continue to improve our great company with these and other initiatives under our mission of increasing shareholder value.
I'll turn it back over to you, Gary.
Thank you, Rick.
Gary: Let's talk a little bit about BRZ, which is our zeolite mining operation.
Gary: We've done a phenomenal job with our new management team, which includes the VP and general manager, as well as the superintendent at the plant, as well as the office manager.
Gary: and that is represented by that very high run time that we've had for the last two quarters between 93 and 96 percent.
Thank you. Bye.
Speaker Change: We also did something earlier this year that the company had never done, which we drilled 82 test holes to make sure we had sufficient reserves, reserve reports being prepared, and in fact, you know, the cost of that is about $150,000, and that was an expense you saw.
Speaker Change: in the year-to-date 930 numbers. Something the company has never done, and something was badly needed.
Speaker Change: It's also important to note that when we did those drill holes, we also blasted enough material that will last us for two years.
Speaker Change: at our current production rates, so it was a win-win situation when we brought blasting crews in to do our testing.
Speaker Change: It's also important to note that we continue to spend CapEx in 2024 at BRZ, which is CapEx that should have been spent...
Speaker Change: two, three, four years ago. We expensed right at $62,000. We bought a front-end loader for $403,000. That gets capitalized, but
Speaker Change: You know as you look at the cash balance Understand we're spending a lot of money that's never been spent in the past. We've been having to fix
this production line, and it's fixed.
to a large degree.
Speaker Change: Problems we've had with MSHA and other governmental agencies that regulate us are, I think, a thing of the past. We had expenses associated with that this year as well that hit our income statement, but those are done.
Speaker Change: So now the business for BRZ is increased sales. We've caught up with all sales, which were typically running 30, 45 days behind. We're now...
Speaker Change: point of sale. We can deliver. Our warehouse is full and we're out soliciting new business. We did ship to a few new animal customers this past month.
Speaker Change: in October, and I think you'll continue to see some sale increases. We did work on an acquisition throughout all of 2024 that we ended up cancelling.
Speaker Change: And so, we do have another acquisition that we're working on that we hope to be able to...
Speaker Change: announce and possibly conclude by year-end but our goal really at BRZ is expand our sales so we're doing that not only with our own dedicated people we're in the process of bringing on maybe one or two additional sales people
Speaker Change: But we're also entering new markets, markets that we've never been in before, and we've been working hard trying to convince the U.S. government that should be stockpiling zeolite for...
Speaker Change: a nuclear disaster. So we also are talking to the government about water treatment facilities around the country. So I think now that we've got our
Speaker Change: process fixed in order, running like a fine-tuned machine. We can now expand sales, and that's what I think you'll see in quarters forthcoming.
Speaker Change: So let's now jump to Antimony, which is I tried in our press release today to give everybody a little more color as to what's going on in the world market and it's really
Speaker Change: eye-opening, I think, for our management team and board to understand, you know, what has really happened and it's been dramatic. So there was an article that came out today that I'm going to read a couple paragraphs from. This says China's gripple minerals is tightening.
Speaker Change: The vice-type grip that China yields over the mining and refining of raw minerals, crucial ingredients of today's most advanced technologies, is about to come even stronger.
Speaker Change: In a series of steps made in recent weeks, the Chinese government has made it considerably harder for foreign companies, particularly semiconductor manufacturers, to purchase the many rare earth minerals and other minerals mined and refined mainly in China.
Speaker Change: Already, China produces almost all the world's supply of these materials. The new restrictions solidify that market dominance.
Speaker Change: As of October 1, exporters must provide the authorities with detailed, step-by-step tracing of how shipments of rare earth minerals are used in Western supply chains. This is given Beijing greater authority over which overseas companies receive scarce supplies.
We are seeing this
Speaker Change: in spades. And when I tell you that, you know, I said in our release this morning, we've talked to no less than 54 different countries, spanning 16 different countries in our goal of, I was to say, 54 parties in 16 countries in our goal of sourcing new antimony supply. It's been a difficult process.
Speaker Change: And it's something that none of our team has ever done before, but I think we've come a long way. We've whittled it down to probably four or five different sources.
Speaker Change: We're receiving samples of those antimony supplies, we're analyzing those samples, and it's very important to understand that the meteorological makeup of this rock is different in different areas of the world. We have to worry about...
Speaker Change: certain amount of gold or certain amount of other Contaminants that may be in the antimony how it affects our systems our furnaces and all so it's a process that we have to go through We're now
Speaker Change: at the point of negotiating contracts to start bringing material. As you know, we're only running at 50% of capacity at Thompson Falls, and so we could use material yesterday.
and we're very hard.
Speaker Change: seeking that material, but we've got to do it right. There's been a lot of brokers, a lot of fraudsters in the market, as you can imagine, when something triples in price.
Speaker Change: Everybody, every crook in the world comes out of the woodwork. So we've had to be very, very careful that we're dealing with parties, we're making our own inspections, and we're making sure the material lands on U.S. shore.
I think you'll see.
and hopefully by year end.
Speaker Change: material that we've been processing, or it may go to Mexico. We have not made that final decision yet.
So...
Speaker Change: As we're outsourcing for antimony, it's also became very apparent to us that we need our own supply.
Speaker Change: We have the expertise in our company and we have a lot of mining experience, 40-50 years of experience and they have vast contacts. So we have been on a high speed race trying to find
Speaker Change: Good antimony deposits that can be mined expeditiously. We're not out exploring, we're going back to areas where antimony has already been found, has already been produced. And it's a big difference when you can mine something at $17.
versus five bucks as your end sales product. So.
Speaker Change: We've made sure that these properties were close to roads, railroads, riverways, any way that we can get that material to Montana.
Speaker Change: We have a flotation facility in Phillipsburg, we have a smelter in Thompson Falls, and we need business.
Speaker Change: So, with that, we know we're in some good areas. We have a lot of competition. We fortunately have been fortuitous and captured some great leases. And it's not only antimony, there's other critical minerals involved.
Speaker Change: There's 17 or so on the government's list. I think we're involved in seven today, so
Speaker Change: I'm going to let Joe talk here in a minute about these activities on the mining side, and we're hopeful that we'll be actually
Speaker Change: producing material in 2025, which is a pretty fast track. Our company is just picking up leases today. We have to obviously worry about weather, and we have to get permits, but we are moving this on a very fast track.
Speaker Change: And after Joe gives his overview of our Canadian and Alaskan operations, then I'll go into greater detail about some of the private and government discussions that we're having so that you'll have a better feeling of where we're going with this company. Joe?
Thank you. Thank you. Thank you.
Thank you, so
Summarizing then our objectives.
Speaker Change: for property acquisition. We want to avoid federal lands and and the NEPA National Environmental Policy Act requirements for permitting.
that other people have run into, like Perpetua, et cetera.
Speaker Change: The alternatives are to go on private lands and on state lands. We've been avoiding anti-mining jurisdictions and anti-mining populations and avoiding
Speaker Change: threatened species habitats, wilderness areas, and things like that. Our preferences for readily available access to potential mines
Speaker Change: general preference for surface mining versus underground mining and transportation access to Thompson Falls and Phillipsburg and and even Madero in Mexico.
Speaker Change: Anteloni and other critical minerals are generally critical because they are in short supply, which means that...
Speaker Change: excuse me, there will probably not be a new discovery of a major ore body.
Speaker Change: A possible exception is as a byproduct to a common mineral in a large deposit, but that's not a short-term solution that will take a long time to bring to market.
Speaker Change: We do not have time to permit and construct a complex metallurgical facility, so we're focusing on high-grade deposits.
Speaker Change: upgrading as required by crushing and gravity separation only. Therefore, no chemicals, no grinding. Grinding would be a large capex and permitting and have tailings disposal costs associated with it, etc.
Speaker Change: Proximity to existing infrastructure is a factor, so the trucking of ore would be feasible.
We're talking.
Cobalt at $11, nickel at $7, copper at $4, and...
Then there's antimony at $17, which has a real advantage.
Speaker Change: Antimony also has the advantage that an antimony concentrate can be up to 70% antimony versus copper in the 24% range, so it's feasible to truck at longer distance than compared to others.
Speaker Change: In terms of what we have done lately, the McLaren River area in Alaska, very high-grade copper in an environment that we believe may be conducive for other minerals.
It needs some exploration.
access is available off of the Denali Highway.
Speaker Change: we're into an area of permafrost so the road building on top of the permafrost is very easy without any
farm to the environment.
The Stibnite Creek deposit in Alaska further to the east.
Thank you. Thank you.
Speaker Change: It's got high-grade antimony, short distance to Highway 1. Highway 1 connects with the Alaska Highway about 20 miles to the east.
Speaker Change: That short distance to Highway 1 is tough terrain, but there were previous roads we're going to do some work on.
to see the best options in there.
The
Speaker Change: We've just recently been informed by the Doyon Corporation, which is a Native corporation on our boundary that they've
Speaker Change: They have done work, and the stibnite occurs across that boundary, so we'll be coordinating with them and seeing if...
We could have a win-win situation for both parties.
The Fairbanks area of Alaska has many antimony showings.
Speaker Change: basically the primary source of antimony during World War I for the Allied forces. That antimony is associated with gold production and with gold exploration so
Speaker Change: There's a lot of information available, a little bit difficult to get it all because the primary focus was on that gold.
gold exploration
Speaker Change: This is a mining area. There's good infrastructure, good highways. It's the terminus of the Alaskan Highway, Elktown Highway.
And we're presently negotiating with several property owners.
in that immediate area.
Speaker Change: Generally in Alaska, we've attempted to convey to prospectors, exploration companies, and geologists that
Speaker Change: We're looking for anemone and other critical minerals. We'd like to buy them from you if you can supply joint venture with you or lease option, purchase your property, whatever is your preference.
Speaker Change: We are in that position of having the downstream facilities. We have the knowledge and not many others can say that.
Speaker Change: Other minerals are cobalt, nickel, copper, tungsten. We've acquired claims both in our own name outright and also in a lease option deal with a long-time area prospector. This is near Sudbury, Ontario.
Speaker Change: The high grades over narrow widths and historic drill holes goes back a ways. The 16% cobalt, 8% nickel are very high grade over a reported four feet.
Speaker Change: There's real potential that there may be a large deposit in this geological environment.
and we will follow up.
Speaker Change: work to date. So far it's been positive showing that there's disseminated cobalt mineralization in adjacent areas.
Speaker Change: The other advantage of this area, there's two very large mining companies.
the Brazilian companies.
Vale or Valet, and the Swiss company Glencore.
Speaker Change: They have excess milling, smelting, and refining capacity, all located within 30 miles of the Karcher property.
So, if successful,
Speaker Change: improving up a cobalt deposit here there'd be no CAPEX or permitting delays for mineral processing plants.
I'd also like to mention...
So, the big asset is people.
Speaker Change: already talked about how good a job Jeff has done at Bear River. Gus is considered Mr. Antimony in the industry, specializing in pyrometallurgy. Aaron, who's relatively new, specializing in hydrometallurgy.
We've engaged two consulting geologists.
Speaker Change: Rod Blakestad, graduate of the University of Alaska. He's had 20 years in the field in Alaska. He's the discoverer of the 10 million ounce gold deposit, Fort Knox deposit.
Speaker Change: It seems like he knows everybody in the state related to mining or geology.
and in the Karchi, Siberia area, Dr. Fred Briggs.
Speaker Change: lifetime with the Ontario Geological Survey. He specialized in the Sudbury area and the Baronian metasedamates.
Speaker Change: Those Veronia metasediments are the source of that high-grade cobalt, but we
Speaker Change: We think we're in a good position in terms of the people that we have on our team. And I'll turn it back to you, Gary.
Thank you, Joe.
Gary: I want our listeners to not be surprised you will see very likely see additional announcements of additional claims. We are not going to slow down here. We see this as being a
Gary: extremely valuable long-term addition to the company and we're the natural ones to be doing it having the midstream and downstream assets.
I can't express enough how valuable those assets are.
Gary: They're giving us huge negotiating power with other companies, and to duplicate what this company has would take many years to try to build, and now it's time for us to capitalize on it.
Gary: So we're in a very fortuitous position. So let's talk a little bit about what's going on on the private sector.
Gary: of companies that have approached us and then I'll go to the government side here after I have Jonathan give you a little overview on our IR. So it's important that everyone understands that
Gary: finished products from overseas and there's an executive order by 2027.
Speaker Change: They need to be getting from U.S. sources if they're going to sell
Speaker Change: to the armed forces or military. And so we have a number, a couple of companies now that we're talking to that is seeking 100% of our supply.
Speaker Change: and they need to finish products in a manner that gives them domestic supply to secure the critical minerals by 2027, which is only two years from now.
So, we're having these discussions.
at the same time as we're having the government discussions.
and so it's it's not just government.
speaking.
Speaker Change: for our finished products. It's private industry, and these are big companies that have big military contracts. So, I wanted Jonathan to jump in. Jonathan is one of the new VPs that came about the same time as Aaron Tanash, who's our VP of Antimony. And as many of you know, we've been...
Speaker Change: marketing quite a bit, trying to tell our story to the street.
something the company's never really done in the past.
Speaker Change: We're hopeful of seeing some equity research coverage before the end of the year, which the company's never had. And we have really worked hard trying to get introduced to bankers, research analysts, institutional investors.
Speaker Change: beating the drums. So Jonathan, I don't want to steal your thunder. Why don't you tell everybody what we've done and then what we've got planned for the rest of the year.
Thank you, Gary.
Jonathan Miller: Good afternoon, everyone. I'm pleased to provide an update on the strides we've made on the investment relations front in Q3.
Jonathan Miller: Our efforts have been centered around deepening engagement with the investment community, enhancing transparency, and strategically positioning our company to share its story in the broader marketplace.
Jonathan Miller: First, I'd like to talk about the institutional meetings and site visits we conducted.
Jonathan Miller: This quarter, we prioritized direct conversations with key institutional investors to reinforce our strategic vision and operational progress.
Jonathan Miller: Through these discussions, we've provided deeper insight into our recent initiatives and received valuable feedback. Additionally, hosting site visits has allowed research analysts to experience our operations firsthand, building trust and understanding about the tangible work driving our growth.
Jonathan Miller: In terms of publications and media outreach, we focused on ensuring our company's activities and milestones are visible to a broader audience.
Jonathan Miller: We secured placements in industry-specific and broader financial publications like S&P Global, Yahoo Finance, Mining.com, and MiningTechnology.com, to name a few, which has not only raised awareness but also contributed to a more informed investor base.
Jonathan Miller: We've also seen a significant uptick in our engagement and reach on our social media profiles on LinkedIn and X.
Jonathan Miller: If you're not following us there, please feel free to go ahead and do so.
Jonathan Miller: This effort to enhance our public profile has bolstered our ability to reach and attract new investors who are aligned with our long-term goals, the focus of which is securing domestic critical mineral pipelines for strategic minerals like antimony that are used in aerospace, military, and defense.
Jonathan Miller: Next, regarding our participation in investment conferences during Q3 and looking forward to Q4, we attended three virtual and two in-person conferences and have scheduled additional key conferences for upcoming months.
Jonathan Miller: These conferences are NobleCon on December 2nd and 3rd in Boca Raton, Florida.
Jonathan Miller: an Investor Roadshow with 7th Circle Consulting on December 5th in Miami Beach, Florida, and the Benchmark Company's 13th Annual Discovery One-on-One Conference on December 11th in New York City.
Jonathan Miller: These events have provided an excellent platform to communicate our message and discuss our unique value proposition with a wide range of investors. Notably, our engagement at these conferences has led to follow-up discussions with dozens of investors interested in deepening their involvement with us, which we believe will be positive for our future growth.
Jonathan Miller: On the Bear River Zeolite side of the business, we are actively participating in research studies with a leading university that has received part of a $26 million grant to investigate alternatives such as zeolite to replace fly ash in concrete manufacturing, aiming to reduce CO2 emissions.
Jonathan Miller: Additionally, we are in discussions with the same university regarding EPA grants to evaluate zeolite as a cattle feed amendment to reduce methane gas emissions in agriculture.
Jonathan Miller: With solid academic research supporting us, we're confident in our ability to penetrate multiple markets that stand to benefit significantly from zeolite. With a robust inventory, we're actively seeking new business across various sectors.
Jonathan Miller: Overall, we're committed to maintaining this momentum, fostering strong investor relations, and keeping our shareholders informed and engaged as we continue executing our goals. Thank you.
Thank you. Thank you.
Thank you, Jonathan.
Thank you.
Speaker Change: Okay, let's talk about government grants. That's the one thing I think a lot of people have on their mind is so what is US Antimony doing in that arena?
Speaker Change: So, last week, for two consecutive days, our company entertained five members of the U.S. government from three different divisions of the Department of Defense.
Speaker Change: They came to visit our two facilities located in Philipsburg and Thompson Falls, Montana.
Speaker Change: This was as a result of our submission of a concept paper in mid-October to the Department of Defense seeking funding in a number of different areas for U.S. antimony.
Thank you. Bye.
Speaker Change: Melissa Pagan, our Senior Vice President of Corporate Development and Government Relations, will be accompanying me this week in Washington, D.C. I leave this evening after this investor call. Our purpose is to meet with our lobbyist firm and attempt to complete two white papers.
Speaker Change: that have been requested by the Department of Defense for various projects we discussed last week while we were in Montana.
Speaker Change: I want to emphasize that there is nothing definitive yet. White papers must be submitted, approvals have to be made, and monies have to be allocated from various pockets.
However, there is no doubt
Speaker Change: that antimony is a very hot topic in light of China's announcement.
Speaker Change: in mid-September to contain all worldwide shipments of antimony for their own national interest.
Now the U.S. government must find a solution.
Speaker Change: We believe we are a natural choice to help resolve the shortage of antimony, especially in finished products.
When we opened up the
Speaker Change: I'm going to open up the investor calls here in a couple of minutes.
Speaker Change: I don't want anybody to ask me anything about the U.S. government that I haven't already said. I have already said all I'm planning to say, and as you might imagine, I'm restricted in saying anything else.
Speaker Change: understanding of this and don't try to ask questions that I can't answer otherwise we're just wasting each other's time.
We know that
The government has a real need for this.
Speaker Change: moderately. We know that we have the ability to meet their needs.
Speaker Change: You will see in our filing today on our 10-Q that we've also
registered an ATM filing, which is an at-the-market issuance.
Speaker Change: with Alliance Global. It's up to 25 million dollars. I will tell you we have no plans to use that in the immediate future, but it's something that we may have to use down the road if we're required to meet certain government funding on a pro-rata basis of some sort.
We need to be
Speaker Change: ready and capable of reaching the capital markets when and if necessary.
Steady on.
Speaker Change: The kind of cash we are today and adding cash every quarter, there's no reason to go be raising capital unless we have a specific need for something which we don't at this point in time.
Speaker Change: We're hopeful that our white papers that we'll be submitting here in short order will allow
Speaker Change: hopefully 100% funding from the government, but we don't know. There has been other companies that are getting funding.
Speaker Change: Some are Canadian, some are U.S. that revolve around antimony. We know others are in the in the wings. So our meetings this past week were extremely educational for our governmental officials.
for us to understand what their needs are.
Speaker Change: And now we have a game plan, and that's what we're working on.
Speaker Change: This company does not have to have government funding to be successful. However, to catapult us to the level where we want to be, we need it. And it could cause something to happen dramatically, quickly.
Speaker Change: and so it's always a nice benefit where it's a win-win situation where we can help them and they can help us and and all of us can help our country.
Speaker Change: So, with that, I'd like to open up the audience to questions you may have about our results for the third quarter and nine months into September 30.
Speaker Change: Certainly. At this time, we will be conducting the question and answer session. If you would like to ask a question, click on the ask question box on the left of your screen, type in your question, and hit send. We do ask that each participant please limit to one question when submitting. One moment while we pull for questions.
Speaker Change: Your first question is, are there any antimony reserves in the ground at Thompson Falls? If so, how much and how soon can this resource be exploited?
Speaker Change: I'll answer that quickly, then I'll let, maybe let Joe jump in. That was the first thing that came to mind when Priceless
Speaker Change: skyrocketed to $17 a pound. I said, wow, we have a mine right here in our backyard. So we dug out old papers and started.
looking in.
It appears that
Thank you.
Fire management sold off most of the surface rights.
Speaker Change: But we still had quite a bit of mining rights. But based on the history of that mine, it did not seem conducive to open it back up. And Joe, do you want to add to what I just said?
Speaker Change: Part of that problem is that the individual claims are surrounded by forests of this land and the
That situation is reminiscent of Perpetua, where...
Speaker Change: They're on Forest Service land and you know the permitting problems there, so we felt it was a waste of time.
Speaker Change: Yeah, and I want to emphasize what Joe said earlier. We've been very, very careful.
in staying away from federal lands where before service BLM
any kind of federal and tribal lands.
Speaker Change: We only want to be on private or conventional lands up in Canada. So state or provincial or private, nothing on the federal side. That's where the hold-ups occur, that's where the permitting has just been atrocious.
Speaker Change: I think Perpetua is a perfect example of that, you know, going on four or five years now.
Speaker Change: Your next question is regrading the additional sources of feedstock you're evaluating. How close do you feel you are to securing additional feedstock and any color on how quickly we might see some of this material become available for processing once agreements are reached?
Speaker Change: It's a very good question, something we ask ourselves every day.
Speaker Change: I think we're getting really close and what will likely happen based on the discussions we're having with various parties is that we might just receive a small container, you know, not a big shipment, a couple hundred thousand dollar
you know, shipments that we can test and...
get comfortable that this material
Speaker Change: can be processed properly with our existing machinery and equipment, furnaces, and not have a problem with it with respect to the actual process. So I'm hopeful that we'll have something that we'll be announcing in that regard before the end of the year.
Speaker Change: Your next question is, what is the condition of the contract mill and what conditions must be in place before it will be fully operational?
Joe, I'll let you jump on that one.
It's fully operational now, we're just...
waiting for feed.
Speaker Change: Aaron has been involved with that mill for a long time. The maintenance has been kept up. It was always a good mill and it's ready to go. There's no rebuilding or reconditioning or anything like that.
Speaker Change: I will emphasize what Joe said in our, I saw that this contact middle for the first time this past week with the DOD.
Speaker Change: And they all went through it, and Aaron, as Joe said, ran this thing for many years. He knows it from...
Speaker Change: A to Z, and it's fully operational today. Flip the switch on and turn it on. There's nothing...
Speaker Change: that needs to be repaired. Now, will there be things that need to be changed or added down the road? No doubt. But as far as an operational facility.
Speaker Change: I mean, there are trucks in there, there are dozers, there are back loaders, all the equipment you need to start this mill up sits on that property.
Speaker Change: Your next question is, Mr. Bardswich, what are the neighbors like in Canada? Are there any significant NI 43-101 compliant reserves or operating mines in the near vicinity?
Speaker Change: That Sudbury area is the single largest mining area in Canada.
Speaker Change: Creighton Mine, where I was born, started in 1885, and it's still producing today, down to a depth of 81, 100 feet is the number nine shot there.
Speaker Change: used to be International Nickel. That's now owned by the Brazilian company, Valet. Fossil Bridge Nickel is now owned by
Speaker Change: They got straddled, she got taken out by her granny's horse.
Speaker Change: There's millions of tons of nickel and copper and cobalt and 14 other minerals coming out of that area. What is significant to me is the availability of that infrastructure where we make a discovery.
Speaker Change: The options of where we can truck the ore rather than having to build a mill or permit a mill, etc.
Speaker Change: The next question is in two parts. Is the ore supply that historically came from tech no longer part of your feedstocks?
Speaker Change: At 50% capacity Thompson Falls, is it safe to say that USAC has been able to benefit from higher antimony prices in Q3 2024?
Speaker Change: Okay, good question. No, 100% of our current material comes from tech.
They were down
So, um, um...
Speaker Change: The second part of your question, I can't remember what it was. Could you tell me operator what the second part was? Yes, of course. At 50 percent capacity, Thompson Falls, is it safe to say that USAC has been able to benefit from higher antimony prices in Q3 2024?
Speaker Change: very little because most of what we were doing in the third quarter was tolling. So in other words, we were locked into a fixed fee of purchase and sale.
That will change.
Speaker Change: and is changing because most of these contracts that we're talking to with these various parties around the world are a percentage of Rotterdam.
Speaker Change: So if you're paying, let's say, 60% or 70% of Rotterdam at a $5 price,
that percentage difference.
and gain is a whole lot different.
Speaker Change: than 60 to 70 percent of 1770 Rotterdam price. So I anticipate our margins improving dramatically as we start receiving third-party material.
Speaker Change: Your next question is, it's been noted by management that they would like to capture the better zeolite margins of the middlemen in this space. What progress is being made in this initiative? Can you quantify sales of cattle max?
Speaker Change: Okay, I'll answer the last one first because it's easy. We haven't had any sales of CattleMax yet.
Speaker Change: Because we had to change the name to cattle prime or maybe that maybe I got it backwards No cattle max is the new name cattle prime was over So we had a we had about a two or three month delay and getting that going because we had a trademark infringement issue that somebody Gave us trouble with and we didn't want to fight it. So we changed the name
You know, we haven't got...
Speaker Change: Sales of any magnitude yet. I think we mentioned we do have some new sales here in the fourth quarter But it's it's minimal
Speaker Change: That's one of the things that we have decided to bring on, a salesman dedicated to the cattle market.
Speaker Change: and we're seeking that person now. Now, I forgot the first part of the question. What was the first one?
Speaker Change: It's been noted by management that they would like to capture the better zeolite margins of the middlemen in this space. What progress is being made?
Speaker Change: As we mentioned, we do have some middlemen, one in particular that represents a good chunk of our business.
We're having some very good discussions with them.
I met with them at lunch.
Good.
Speaker Change: We're needing an audit of their financials which was completed and delivered to us and we're in the final stage of trying to finish up an LOI and an arrangement. So that is progressing.
Speaker Change: And that would have a marked change to the margins of the Zeolite BRZ facility.
Speaker Change: Your next question is, are you involved with or planning to be involved with any U.S. critical mineral coalitions or mining advocacy efforts?
Speaker Change: Yes, I mean, we are talking to a lot of different parties about critical minerals.
Speaker Change: You know, while we're focused on antimony, as Joe mentioned, that's not obviously the only critical mineral we're involved in.
Speaker Change: We actually met with a firm up in New York just recently about Cobalt.
Speaker Change: They love Cobalt, and obviously their Canadian situation is there. So, you know, like in, you know, you remember I spent 35 years in the oil and gas industry. So we're out talking to industry partners about promoting. Hey, we've got these leases. Would you like to be our partner?
Speaker Change: We want partnerships, we want collaborations, whether it be the US government, whether it be private industry, whether it be other mining companies. And so I think you'll continue to see those type of opportunities announced as we develop our strategy there.
Speaker Change: Thank you. We have reached the end of the question and answer session and I will now turn the call over to Gary C. Evans for closing remarks.
Um
Speaker Change: As I said in the press release today, this was a so-so quarter regarding financials, but it was a phenomenal quarter regarding what we're doing for the future of this company.
Speaker Change: And so you can't take every, you know, even though our revenues were up and our gross profit was up, our loss was greater. And the reason the loss was greater is we're spending money with people.
with Lisa's
Speaker Change: with SEC reports that have never been done before, but drilling test holes, but doing things that can't be capitalized.
Speaker Change: all the expenses you're seeing flowing through the income statement and a big chunk of that's non-cash because we're we're not taking salaries we're taking stock compensation that's how much we believe in this company so I think you'll see that we have planted the seeds
Speaker Change: for the future growth of this company that's going to be exponential.
You know, I'm used to running billion dollar companies.
This needs to be a billion-dollar company.
Speaker Change: And our goal is to grow it rapidly, and we believe that we're perfectly suited at the right time to do that.
Speaker Change: Hang on and watch out. That's what I got to say. And I think that this company has an extremely bright future. I think you'll see.
Speaker Change: maybe three research reports out on us before the end of the year and Don't be afraid of this ATM It is another feather in our hat just to be sure if we need to raise capital we can It's just under our universal shelf. We have no plans to be selling stock tomorrow or next week. So
Speaker Change: understand that. But I will tell you if we have an opportunity that makes sense we will use it down the road. I've raised in my career
Speaker Change: over three billion dollars in ATMs and I've done it wisely and I've done it where it does not hurt to stalk and you won't see this happening in the near future but it could be something we need down the road. We're being prepared and we're being smart.
Speaker Change: financial stewards of the company's resources to have everything available to us as necessary when the time permits. So with that, I'll hand the call over to you, operator, and thank everybody for participating today.