Ucore made another news release today that continues to demonstrate the technical success of MRT using solution from the company's Bokan Mountain project. This news was expected, but encouraging. Best of luck to the team as they approach the final stages of the pilot plant project -- I hope they continue to show that they are creative and can play well with others as they level-up in their business.
This picture is the title page of their recent presentation. It alludes to the 'hub-spoke' business model that Ucore is using to describe how they will commercialize their rights to MRT. One thing that piqued my interest in the presentation was the slides provided by Adamas Intelligence -- I understand that marketing these critical metals can be difficult and I hope that new people like Adamas Intelligence and Jack Lifton can help the company make new progress with marketing. For example, will Ucore be able to use output from the MRT pilot plant to provide samples to potential buyers? (Hint: Yes. Better question: when?)
To close, I would to offer a few brief comments on Ucore's 2015 financial statements. You can see that they posted very large cash flows this year (ca. 50% increase in investing activities). I think this is a good thing, as it reflects the fundamental developments around MRT, but still deserves closer inspection.
From the Financial Statements:
"At December 31, 2015, the Company had working capital of $3.1 million, with a cash and restricted cash balance of $3 million. The Company used approximately $3.1 million of working capital to fund operating expenses for the year ended December 31, 2015. Net cash expenditures on resource properties and related deferred costs totalled $4 million during the year. This was primarily funded from working capital, as well as total proceeds of $USD7.5 million from the various royalty based financings completed during the year."
From the MD&A:
"The Company completed a drill program on the property during the prior year, which is expected to be the last required drilling prior to the completion of a feasibility study. Expenditures on environmental and permitting during the year totalled approximately $500,000. Expenditures on metallurgy were $2.7 million during the year ended December 31, 2015 which is largely related to the construction and operation of the MRT technology pilot plant with IBC Advanced Technologies Inc. Costs associated with the feasibility study totalled approximately $80,000. The remaining $470,000 was spent on non-drilling geology based expenditures."
So, they spent $2.5M acquiring the MRT rights (more to come) and $2.7M on the MRT pilot plant. This starts to give a sense of the floor of the costs for an MRT plant, but is preliminary. They spent $1.2M on the Bokan property and are now ready to apply (!) for permits. In contrast, they spent $2M on salaries and consultants. That looks like a lot on people relative to property, but I think it is OK given the ongoing pivot in their business model.
Stay tuned for more exciting news and buzz around Ucore.
