In mining, the commodity being mined and its grade are key to potential investment success:
- Alphamin is mining tin, which potentially has both good future demand growth and constrained future supply. These are ideal metrics to support future price strengthening and provide a floor price, below which tin is unlikely to trade.
- Grade is a factor that is immutable in any mining project. Alphamin is mining the highest and second-highest known tin grade deposits globally.
Alphamin represents an attractive investment opportunity:
- Firstly, the high grades of the Bisie complex (blended 3% across both mines) enables the operation to operate at the lowest-cost quartile of the global tin producer complex. This buffers the company against periods of low tin prices but results in healthy EBITDA margins during periods of strong tin prices.
- Alphamin is situated in an extremely rich tin province and management has demonstrated its ability to successfully find, develop and bring into production two of the highest-grade tin mines in the world. With future exploration spending planned, Alphamin could potentially find and develop further tin mines from within its exploration license areas, thereby either extending the life of its existing operations or building a third processing facility.
- Finally, Alphamin has a modest external debt position and is generating strong operating cashflows. The company is thus able to invest in and grow its current operating footprint, while returning excess cashflow to shareholders in the form of dividends.
Blue Sky Exploration Potential
Visit TMX Money for all Investor Relations Information
