Q3 2024 Contango Ore Inc Earnings Call
So just outline is our guidance for the.
We're definitely going to be towards the higher end of the original guidance we gave between 30 and 40,000 ounces.
with batch three that's underway right now. It should probably finish up in the next two or three weeks. 2025 guidance, it's not formal yet. We have yet to, we'll have a joint venture meeting here shortly and report.
We're sorry, we will approve the.
the joint venture budget, and in that will be our guidance, but we're believing that's going to be based on our discussions with Ken Ross somewhere in the neighborhood of 60,000 ounces of production.
in year 2025.
So, obviously, we'll expect to make additional money on the sale of those ounces, and the first priority of business is to pay back the debt, and of course, the second priority is to continue to advance our Lucky Shot and Johnson Track projects.
And, uh, you know, uh,
We continue to use our direct shipping or DSO approach, which of course lowers our environmental footprint, which reduces the permitting risk, and lowers our overall capital outlay by not building a mill and not building a tailings facility.
Mike: So, just with that overview and my perspective on our Q3 results, I'll ask Mike to
Mike: to give us his more CFO hat perspective on Q3 results. Mike?
Mike: As Rick mentioned, we finished the quarter at about $36.2 million of cash and this compares to about $24 million at the end of June of this year and $15.5 million at the end of December of last year.
Mike: As Rick mentioned, we also received our second distribution from the joint venture of $12 million subsequent to quarter end.
Mike: For the quarter, we reported a loss of $9.7 million or a loss of $0.81 per share. That does include a non-cash expense of $22.9 million, which relates to the unrealized loss on the mark-to-market derivative contracts for the hedges.
Mike: So this compares to a net loss of $13.2M or a loss of $1.47 per share for Q3 2023. The primary reason for the reduction in the net loss is in the 2024 period is due to the Peak Gold JV commencing production at Manchot and resulting in income from our equity investment in the amount of about $28.5M.
Mike: And this compares to a $5.6 million loss in Q3 of 2023.
Mike: In addition, the company did report a $28.8M loss on the derivative contracts in Q3 2024, which compares to a $2.7M loss in Q3 2023.
Mike: On the statement of cash flow for the nine-month period September 30, 2024, I'd like to highlight that the company had positive net cash provided from operating activities in the amount of $10.6 million.
Mike: and this compares to net cash used of $7.7 million for year-to-date 2023. And as I mentioned, the primary result is because of the commencement of production at Moncho and the receipt of the company's first cash distribution of $19.5 million from the Peak Gold JB.
Mike: That completes my portion of the presentation and I'll pass it back to Romeo.
Romeo: Thanks Mike, appreciate it. So I do, I so rarely get the chance to grill you Mike, so I've got a couple of questions for you if you don't mind. Just in looking at the gold sales and cash growth, to my eyes it looks like they don't show up in the kind of traditional way on your statements. So I'm curious just if you could clarify why that is and how a reader should look at it to kind of better understand those.
Mike: It's a good question. They're quite complicated, these financials. A lot of it has to do with the fact that we only have a minority interest in Manchos. We only own 30% so we don't consolidate those results.
And so.
Mike: The first thing I'll mention is, you know, the portion of our profits related to that all comes through the investment in equity income, which you see as a gain in the financials just below kind of the
Mike: It's in operating activities, but just below all the main expenses. So you see that $28.5 million coming into the income statement. So that's where you kind of focus on the profitability of the operations, which is our 30% share of those profits.
Mike: The gold sales, the revenue and the cost of sales that you would typically see in a mining company don't show up as top-line. The main reason is because selling gold and silver is not core to our business as it is today.
We're set up
Mike: Moncho gives us our 30% of gold and the whole reason they do that is just so we can deliver into our hedge agreements and then we sell the remainder at the spot. You would actually see if we had that in our financials as revenue and cost of sales, you'd see.
Mike: revenue of, say, $60M, then you'd have cost of sales of just slightly less than that because we're paying back the GDP for that Gold and Silver. This avoids confusing the market and making it look like it's unprofitable when it really is. Those sales and cost of sales actually just flow through the peak GDP.
Speaker Change: So, I'm not sure if that's clear, but it's not normal and it took a while to figure that out and get there. No, it's helpful. I do appreciate that. But on that, do you expect any more cash calls from the GV?
Speaker Change: Currently, we do not expect any cash calls unless there are some unforeseen expenses that we're just not aware of. But the last cash call was in July for $4.1 million, and we don't expect any more going forward.
Great.
Speaker Change: And what what do you reckon your debt balance will be at the end of this year? And what do you expect for the end of 2025? Yeah, our debt balance is currently at 52 million dollars and that's where we expect it to With to end at the end of this year and that's for the credit facility and right now We're scheduled to pay down another 42 million dollars next year. So we should finish just shy of 10 million dollars at the end of
25.
Speaker Change: I'll shoot to you, but I'm eager to hear Rick's perspective on it too.
Speaker Change: The 36.4 million in cash, I think you said, and strong cash flow, which I don't get to say about most mining companies, from Muncho. How are you thinking about capital allocation between debt reduction, lucky shot advancement, Johnson Tract development? I know there were a lot of questions emailed about that. Just curious of what that looks like.
Speaker Change: You want me to start with that? From my opinion, my focus is making sure we pay down the debt on schedule, on time, and if we can accelerate that, we'll look to do that, and then ensuring we deliver to the hedges, and outside of that, that's where Rick comes in to decide how he wants to spend any excess cash.
Rick: Yeah, I guess I would just say we love our bankers, but we like to also say goodbye.
Rick: And, you know, just the first order of business is really it to pay down the debt. And then, you know, advancing our projects.
you know, we're
Rick: We have a plan for Lucky Shot. We've talked about that, getting the drilling done and outlining a mineable resource in the neighborhood of four to 500,000 ounces.
Rick: If we're producing, with that mine plan, say producing 40,000 to 50,000 ounces with a 10-year horizon.
Rick: We think that makes really good sense for LuckyShot, it'll take a couple of years to execute that plan.
Rick: And then, likewise, for Johnson Track, it's a little longer timeline, because...
Rick: The nice thing about Lucky Shot is it's fully permitted as a mining operation, whereas Johnson Track we still have more permitting to do to be able to build the tunnel.
Rick: to get underground to be able to do the drilling. It's more of a stepwise process there. Clearly, our revenues are going to depend on the price of Gold, which just took a nice big hit.
Rick: If there's pressure on the gold price, we're going to have to go slower.
Rick: Because, again, we want to get out from underneath the death is the most important thing.
Rick: We're still going to have good strong cash flows with producing 60,000oz of Gold, but
Rick: That margin depends on the price of gold. So price of gold is going to continue to tumble. We're going to have to watch how we spend our money. And most important thing for a junior company is not to run out of money.
Yeah, that's true.
Speaker Change: That's the CFO head shake, I'm familiar with that. I did notice, this is back to you Mike, that there was a $718,000 income tax expense.
Thank you.
which I believe is new for Contango. So I'm curious.
Speaker Change: There were no losses to shelter that income? Yeah, no, it's purely a direct result of the high gold price we had during the quarter.
Speaker Change: and the fact that you can only apply 80% of your losses, carry-forwards, against your current year income. So unfortunately, the JV made too much money in the quarter and we had to estimate a tax accrual for it.
Speaker Change: for the period. And we'll do our best to bring that down by the end of the year, but that was what we had to come up with.
I appreciate that.
Speaker Change: It's a terrible thing about making money. Uncle Sam needs his share. He always takes his piece, yep. One thing regarding, and just getting to Johnson Tract real quick, regarding the drilling program, I'm curious if you could elaborate on what you're seeing from the hydrological testing and metallurgical work that's going on, as I understand it, alongside the resource drilling.
Speaker Change: There was infill drilling, so we'll definitely be reporting results on that for all the holes that intersected the ore body, which was all the holes, because it was purposeful drilling to do infill drilling, to do the geotechnical and the hydrologic work.
Speaker Change: The hydrologic work is really just to get more data from the top of the deposit all the way to the bottom of the deposit, understand how much water there is.
Speaker Change: on the ore body side of the fault. As you recall, there's a main fault, the day size fault that separates the...
Speaker Change: of the unmineralized dayside intrusion from the mineralized tufts on the other side.
Speaker Change: And so that's the main purpose is to understand how much water is over there.
Speaker Change: So you do these hydrologic pump tests and monitoring tests. So there's not like a lot of, you know, we're like looking at the holes and saying, oh, there's a lot of water, there's a little water. It's really more about water chemistry, or it's as much about water chemistry as it is about...
Speaker Change: about how much water there is. For the next step, getting the underground incline tunnel in
Speaker Change: which we still have to get permitted, and we've started that process with the state. That's a state permit. When you're building a tunnel, you're a mine, even if you're not processing or moving ore, you're still technically a mine and you're under MSHA, which is federal oversight.
Speaker Change: So that's the next step, and we're highly confident there that we know that we understand how much water and mainly the water quality that we have there, so.
Speaker Change: But that's what we're permitting. We had a good meeting with the office of management and project manager for
Bye.
Speaker Change: from the state. That was actually a couple of weeks ago when we had the Alaska Mining Association Convention. Since we're all in town, we also met with the O-Pump.
Speaker Change: That's the group that issues the mine operating permit. It will take about a year, 18 months.
Speaker Change: Which is kind of, you know, good timing from next year we build the road the following year we
Speaker Change: we get the equipment in and start building the tunnel. It'll take about a year to build the tunnel and then plus or minus a year to do the drilling and do all the feasibility level mine planning.
Speaker Change: While we're on Johnson Tract, there were a number of questions that came in an email. I know we've already kind of touched on this, but I can basically summarize all of them together as when are we going to hear more about Johnson Tract. So I'll shoot that to you now. Hopefully that will cover most of the questions in the email.
Thank you.
Speaker Change: Yeah, so main thing is we'll have our drill results out.
Speaker Change: And I'd say within a week or two here, I think I just saw that they're starting to put the press release together, waiting for final QA, QC on all the results. And look, yeah, I wanna, you know.
Speaker Change: This is all infill drilling, so we're not trying to build resource here. We're trying to upgrade inferred resources to indicate it. The lion's share of the drilling we did was in the top one-third of the deposit that we can access.
Speaker Change: relatively easily from the surface. The rest of the other two-thirds of the ore body is not conveniently located from a geometry standpoint when you've got two big mountains going up on either side. So that's why we need the underground and why we have to go permit that.
Speaker Change: Because the level of drilling that you have to do for a feasibility study would just be prohibitively expensive to do it from the surface.
Speaker Change: Plus, you're going to mine the ore body underground anyway, so put the development in and get all that done.
Speaker Change: We've done all that work at Lucky Shot, and so we just, again, we kind of just, you know, wash, rinse, repeat, do the same thing at Johnson Track, so.
Speaker Change: and then the next thing is so the press release in the next week or two here on the drill results
Speaker Change: And then we're doing a PEA, Preliminary Economic Assessment, and it's on a direct shipping or model. So we've got a...
You know...
a place that we're gonna be sending this ore to.
Speaker Change: Now, the ore is polymetallic, so it's copper, lead, zinc, gold, silver.
Speaker Change: And so we're going to require a specific kind of processing to produce a flotation for actually for flotation concentrates, a copper concentrate that will have some gold with it.
Speaker Change: a Zinc concentrate that usually just has Zinc, if you're doing a good job of just loading the Zinc, and a Lead concentrate that'll have most of the Silver, since we know that most of the Silvers occurs with Lead, and then a Gold concentrate. So,
Speaker Change: Now, the working assumption here is we're sending this place to a place that has an existing mill and a tailing facility, but it's not going to have the specialized flotation equipment. So, that capital will be included in this assessment.
Speaker Change: And of course, the transportation plan to get it to that location.
Speaker Change: Since we're very close to the water, the working assumption here is we're transporting the ore down to a barge access point and then barging the ore to the existing mill.
Speaker Change: So, we'll see that PEA come out, I'm hoping before the end of the year, but as a lot of these things go.
Speaker Change: If you don't get it done by mid-December, it's probably not getting done until mid-January. So, I won't say we'll absolutely get it done this year, but that's certainly the objective is to get that out.
And it's a little different than under Canadian Rule 43-101.
Speaker Change: In Canada, you can put your results out and then file your report 60 days later. Under SK-1300, that's one of the...
the big differences in U.S. reporting under S.K. 1300.
Speaker Change: You can't do it. You have to put the report out the same day. So no flashy press releases and then the formal report 60 days later. It's got to be filed at the same time.
Speaker Change: And we want to do a good job, so we're crossing all the T's and dotting the I's.
Speaker Change: No, great. The other question that came in an email, almost all of them were about Johnson Shack. There's one that came in, somebody said that you had a long time ago mentioned the possibility of thinking in the future about running a dividend for Contango. Just curious as to your current thinking on that.
Speaker Change: I'll let Mike weigh in on this too, but again, philosophically, pay the debt off.
and obviously advance our projects.
Mike: So, I think it's going to be a few years before we're in a place to think about that, but I would actually say that that is, you know, selfishly speaking as a shareholder, I'd love to see us either pay a dividend or look at a share buyback. A lot of people have commented to me that
Mike: What they don't like about dividends is that they have to pay taxes on them. I get the impression that a lot of people just don't like paying taxes.
Mike: So, you know, it but it is, you know, either way it's a it's obviously a benefit to shareholders and, and that's certainly the way we're thinking that's why we like the type chair structure that we have. I know some people say, oh, you know, you should, you know, roll your stock forward 100 to one or something like that.
Mike: If we're if we're in a position where we're making you know
Mike: $5 of free cash flow or something like that and we've got 12 million shares of a dollar a dollar dividend goes a long way So that you know, there's certainly philosophy philosophically. That's where our heads at But it's definitely going to be a couple of years before we're you know, seriously thinking about that. So just put it in perspective
Speaker Change: I'm not sure what I could add to that. I think if we're producing for more than one asset, I think that also kind of will help it be in a more steady position. And so once you kind of start doing the dividends, we want to continue.
Speaker Change: continue. I would think the best-case scenario would be 2 or 3 years out with the debt behind us.
Speaker Change: Great. Jumping into questions from the audience now. There's one from Tate who asks, why production drops in Q4 from Q3 based on 2014 production guidance and the Q3 production level?
Speaker Change: I'll start, Mike, and then maybe you can fill in from a different perspective, but so, I mean,
Speaker Change: Normally, in a half year, so we started production in July, so normally we'd have two.
two campaigns.
Because this was a startup year, you know, we're
we basically get an extra campaign, a campaign three.
Speaker Change: But it is going to be lower grade, because basically it's...
Speaker Change: It's taking a lot of the lower grade material that's been built up over the course of mining for a whole year. Keep in mind, we started mining in November of 2023.
and building the stockpiles. We only started transporting then.
Speaker Change: Sorry, we started mining in July and we started transporting in November. So those stockpiles got built up and obviously you always want to transport your better grade material first.
Speaker Change: And that's how you'd run any sort of mine. But you also have a footprint constraint, you only have stockpiles that can get so big.
Speaker Change: Basically, campaign three is trying to get rid of a bunch of that lower-grade stockpile and blending it with regular-grade material.
Speaker Change: and making room in the stockpile area at Montreau just so you can keep a steady operation.
Speaker Change: That's kind of the nature of the third campaign, it's a bit of a clean-up campaign, it's smaller and it's lower grade, so that's the main drivers.
Speaker Change: Yeah, I don't think there's anything I can add to that, Rick. You covered it all. Great. This next one, I think, is for you, Mike. Somebody asked, the presentation shows potential 2025 free cash flow per share of $6.
Mike: He wants to know if that's the checks from Kinross from on show or is it net for exploration expenses global expenses and capital expenditures
That would be on the Moncho production.
Speaker Change: And that's a live came out of one of our banks that follow us, one of our analysts.
Good.
Speaker Change: If you have any additional questions about that, let me know in the chat.
Speaker Change: There's one question, and this is about hedges, I know they make fun of us on Twitter for talking about hedges, but we do get questions. Somebody asks, it looks like you hedged 54% of production in Q3-24, they want to know if the amount you hedge is going to vary quarter to quarter, and if so, why?
Speaker Change: Yeah, the amounts that are hedged basically follow the feasibility study and so they they change each each each quarter to kind of mirror what was in the feasibility and So, you know next year we we have about
Speaker Change: 60,000 ounces are hedged, which will end up leaving just 40,000 for 2026, and it varies each period.
Speaker Change: And so, for this year, we basically just followed the same,
Speaker Change: same approach of just delivering 60% of each campaign into the hedges.
and selling the remainder at spot.
Speaker Change: Because the campaigns did not line up directly with the hedge dates, and so you had to kind of manage the program and just make sure you didn't come up short.
Speaker Change: Yeah, Romain, I just want to add that I wasn't sure the way you asked the question, it seemed like the person asking the question was thinking we're sort of proactively hedging. These are all hedges that are in place and were necessary to secure the debt financing. So just, you know.
Speaker Change: They're not purposely selling gold at a lower price. Sadly, we locked those in when gold was $1,900.
or not.
Speaker Change: $800, $700 bucks in less than a year. True. And in the same kind of area, but it's a broader macro question, so I'll throw it to both of you. But Jan van Morsel asks in the chat, what's your outlook generally for the price of gold? And although it's related to what you just said, how does that affect your hedges? But I think we've already tackled that, but I'll throw it to you guys for the big old question of what's outlook for price of gold.
Speaker Change: I don't like to guess the price of gold because I'm usually on the opposite end of that, so I won't comment on that.
Speaker Change: With respect to the hedges, if the Gold price goes up, we continue to make more money. The hedge liability also goes up, but we are more profitable. We just have to give half of it back to the hedges.
But it's a good thing for us
I want to just explain when Mike says hedge liabilities.
Speaker Change: Those are unrealized losses. So if we don't deliver the gold.
Speaker Change: we're in trouble because that's what that means. If you're unrealized, because that means it didn't happen, and as long as we keep producing Gold and delivering into the hedges, we're fine. We're just making less money.
Speaker Change: It's a terminology that the financial community uses that I think sometimes confuses shareholders.
Speaker Change: But on the other side, I'll answer the question about gold price. I think we need Elon Musk to mention to President-elect Trump that he can be the gold king as well as the crypto king and the king of debt.
Speaker Change: It's been an interesting two-week period to see CryptoDisk go crazy, and you know we've had, and Gold's been the...
Speaker Change: not been the better factor of that trade. It's by crypto short gold. And so.
Yeah, I
Speaker Change: I think the fundamentals for gold are still really good. I think, I'm sure China and Russia and Iran and Turkey, all the central banks who loved or who have been buying gold are loving the $200 discount that they just got, the Trump discount. But I think it's, my view is it's gonna be relatively short-lived.
because
Speaker Change: As Trump is fond of saying, he's the king of debt, he drew his empire on debt, and he's
Speaker Change: He's not afraid of it. So we have 36 trillion dollars of debt
Speaker Change: in the United States, and in four years, my, you know, it's not my guess, other people, expert people who look at these things said, say our debt's gonna be 50 trillion. So at some point, that's a big number. I don't know when that becomes actually a big number and scary number, but it's a big number already, so.
Speaker Change: Beyond a trillion. Beyond a trillion, it's just crazy, right? Hard, hard to think past that. One question that came in over email during the event, is somebody really excited about LuckyShot specifically and wants to know what the next catalyst there is.
Speaker Change: Drilling, as I think we've heard our President-elect say, drill, baby, drill. So that's what we're going to do.
The mine is permitted, so
Speaker Change: We're all set up for mining and whatever additional work we need to do underground to access the drill points we can do. And then it really is just drilling. And again, we're underground right in the footwall of the vein, so they're relatively short holes.
Speaker Change: We're looking at overall, again, over a two-year period, drilling about 15,000 meters underground and maybe 5,000 or 10,000 meters on the surface.
Speaker Change: And obviously, we won't get started until next year, so that, you know, that's...
Speaker Change: Let's say that the next May is when I would expect that we'd get in there and start clearing snow and getting access to the underground. We keep the road open in that because you want to maintain things.
Speaker Change: on an ongoing basis, but the activities won't get really started until next summer. So stay tuned for that, and obviously we'll...
Speaker Change: I'll just caution you that we will be looking at the Gold price.
Speaker Change: The short gold and gold-long crypto is still here with us in six months. We're just going to have to be aware of what the gold price is. Again, the first order of business is to pay back the debt. The second order of business is to advance our projects.
Speaker Change: Great. Speaking of advancing projects, somebody in the chat notes that the Q3-24 exploration expenses were about $3 million. They want to know if you think quarterly exploration expenses are going to grow from there and what that's going to look like.
Speaker Change: That $3M related to the Johnson Track surface drill program we did this summer. You would expect to see very small exploration expenses for Q4 and Q1. Once we give our guidance for next year on what exploration we're going to do, you'll see it ramp up. It's all year by year and what we decide to do and put in the budget. But this year was a $3M budget so we spent $3M.
Speaker Change: Just to cover it off in case people are wondering, the joint venture spent $4.7 million of exploration on the Tetman lands.
Speaker Change: But that's captured inside the joint venture and you know, so we don't it doesn't it doesn't reflect on our books
Right.
Speaker Change: One more question about hedges, with apologies to Twitter, Seb asks how far forward in years are you hedged?
Speaker Change: We're hedged about 110,000oz remaining and we deliver into those next year and then 2026. So, there's 40,000 of those ounces in 2026 with the rest going next year.
Great.
Speaker Change: I appreciate it. So Vitaly from the chat, I think I covered half of your question already. I was just curious if there is an expected revision or additional guidance on ASIC estimates?
I'll just say we will have, I think, in our
Speaker Change: year-end financials, which will be, what, in February, Mike? Early March. Early March. Yeah, we'll have, you know, not a full year, but a full half year.
Speaker Change: production from 2023. And so I think that'll be, you know, we'll have all the numbers and that'll be more reflective of a true ASIC.
Speaker Change: Yes, and also as we look to give our guidance for 2025, whatever information we get from Kinross, we'll look to incorporate that and if the numbers change, we'll update the market as soon as we know.
Great. Thank you.
Speaker Change: And I know we're bouncing around, but from the chat, Ekiwas asks, is there any exploration currently at Manchot? And are there any discoveries? And throws an exclamation mark at the end.
Speaker Change: Exploration was wrapped up, let's see, almost a month and a half ago or so.
Speaker Change: We actually will have a joint venture meeting later, and I'm sure we'll see what the results of the exploration program were, and then we can – obviously, if there's significant results, we'll certainly report those.
Speaker Change: Awesome. And I got one last question for both of you, unless there's additional ones from the audience while I'm asking it. You know, I like to ask this at the end. I'll start with you Rick and then go to you Mike. What are you most excited about in the next near future for Contango?
Thank you.
Speaker Change: Yes, making money and producing gold. It was very exciting to hold that bar of gold up and say, OK, this is from me.
Speaker Change: start to finish, you know, finding a deposit, outlining a deposit, figuring out a path forward. I think we can.
We can repeat that success
Speaker Change: with the cash flow from Moncho, with Advancing Lucky Shot and Johnson Track in much the same way. I'm excited about our model. I think it is a little different, but it does require us to focus on high quality, high grade deposits.
that are close to infrastructure so we
Speaker Change: and relatively simple, high quality ore bodies. I mean, both, you know, Lucky Shots, high quality, that's really good grade.
And it's a simple, simple ore body, simple metallurgy.
Speaker Change: In Johnson Track, again, high quality, not too many underground ore bodies average 40 meters wide. That's a bit of a beast of an underground, it's not really technically a vein, but it's a vein breccia zone, so it's just a nice area.
or body to mind.
Speaker Change: And I think there are other opportunities like that for us out there, and we'll take our time.
Speaker Change: and I think we're just in a really good position. I think we just have to be patient. We have to be able to look at where the gold price is and what our margins are and just not to get too far ahead of ourselves too quickly either. We don't want to.
Speaker Change: The worst thing you can do for a junior company is run out of money.
So, okay.
Speaker Change: Mike, I'll throw you the same question. Yeah, no, and I'll echo Rick on, you know, I'm looking forward to seeing profitable financial statements and earnings per share, which.
Speaker Change: It's tough to do as a junior mining company and getting out from having this debt and moving.
Speaker Change: Moving Lucky Shot forward and Johnson Track, I think that's going to be exciting to put those both in production and have streams of cash coming from three different projects and growing this company into a billion-dollar company.
That's what it said to me.
Speaker Change: Awesome. Billion-dollar company. A formal prediction from Mike Lexie. Definitely a forward-looking statement. I'll throw a slide up. There's one very direct question from the chat, which I think will be fun to end on. I'll throw it to you, Rick, but Mike, if you have any additional thoughts on it, please
Rick: Seb asks, as a potential investor, why should I get in now and not wait for the debt to be repaid?
Rick: Well, in two weeks, we've lost about $5 of value based on a Trump trade of crypto going crazy.
Speaker Change: And maybe crypto is worth all that, I don't know. But I know based on our cash flows that that's a hell of a steal, buying a stock for $18. Your timing is really good.
Speaker Change: we're just going to continue to execute. As Mike said, we want to grow this company. We've got a strong portfolio of high-quality projects. Our three projects are Moncho, Lucky Shot and Johnson Track.
Speaker Change: And we've got a plan that just makes a lot of sense, and it's a simple plan that we can execute. So, you know, we're not here telling you we're going to raise a billion dollars to go.
Speaker Change: build a big, low-grade mine in the middle of nowhere. There's a lot of stories like that, so we're not that. We're focused, and we're focused on high-quality projects.
Speaker Change: that we can process at existing facilities elsewhere with, and they can afford the transportation, right? So whether it's by truck or rail or barge or all of the above, that's the plan we're executing on.
Speaker Change: If we can continue to demonstrate profitable operations quarter over quarter, I think there is potential for a re-rate on the stock based on cash flows and how much money we're making when you compare it to our peer group.
Speaker Change: In addition to that, I don't think our stock gets a lot of value for Lucky Shot or Johnson Tract. As we advance those projects here in the near term, we may get additional value there. Right now, I think we're just valued based on Moncho and potential cash flows there.
Speaker Change: Certainly, the analysts would agree because their valuations are all significantly higher.
Speaker Change: We can't flash those up, but you can go online, and if you go to our corporate presentation, our analysts that cover us are listed there, and from what I understand, if people e-mail them, they're happy to share their information.
their work because obviously that's why they cover the company.
Yep.
Speaker Change: So, Rick, Mike, thank you so much for going through all the questions today. Everybody who joined us, thanks so much. If you do think of the perfect question to ask right after the event ends, as I often do, please still send it in. I'll make sure the Contango team gets it and gets back to you as soon as possible. But otherwise, Rick, Mike, thanks so much.