Update: TriMetals Mining Reports Q2 Earnings

Aug.18.14 | About: TriMetals Mining (TMIAF)


TriMetals Mining continues to focus on exploration and metallurgy at its Gold Springs Project.

Management has reduced G&A Costs over the quarter which means the company is preserving capital.

My bullish thesis remains intact as the market cannot get over the loss of the Malku Khota Project.

TriMetals Mining (OTCQX:TMIAF) just reported its second quarter earnings results. For an exploration-stage mining company these reports tell us what the company has been up to and whether it is using shareholder capital wisely. We learned that the company continues to explore its Gold Springs Project on the border of Nevada and Utah. This project is now the company's top priority as it lost its mining rights at the enormous Malku Khota Project in Bolivia. During the quarter the company revised its exploration budget upwards from $5.2 million to $5.7 million, with the upward revision a result of a decision to explore more aggressively at Gold Springs.

The company also announced that its G&A expenses have come down from $2.8 million to $1.6 million as the company shut down its Vancouver office and reduced executive salaries.

As I argued in early July the company was - and still is - undervalued as investors simply do not want to touch this stock after its Malku Khota Project was confiscated by the Bolivian Government. While this was a devastating blow this is in the past and the company has two compelling assets - Gold Springs and Escalones (in Chile). The company has made several changes in order to turn the company around such as spinning out most of the claim to any settlement monies from Malku Khota into a new company - TriMetals Mining B (OTCQX:TMIBF). The cost savings and the more aggressive drilling at Gold Springs are also significant measures, although they have yet to sway investor sentiment as shares remain undervalued, although they seem to have found a bottom.

Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.

Editor's Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.