MacPhersons Resources Limited (ASX: MRP), a metal and mining company based in Western Australia, is engaged in the exploration of gold, silver, nickel, and zinc within the Kalgoorlie region. The company currently has 2 projects in its portfolio, the Nimbus Ag-Zn-Pb-Au deposit, and the Boorara Gold Project.
The Boorara Gold Project, with gold mineralization, is divided into three gold deposits, Northern Stockwork (NSW), Southern Stockwork (SSW) and Crown Jewel (CJ).
The Nimbus Project is volcanic-hosted massive sulphide (VHMS) deposit consisting of gold, silver, nickel and zinc minerals. The deposit is a shallow-water and low-temperature deposit with epithermal characteristics.
Today, MRP has come up with the quarterly update and the cash flow statement for the second quarter of FY19 ending 31 December 2018.
During the 1H 2019, MRP completed an intense in-fill RC drill program at the Boorara Gold Project, and now it has suspended any further resource work until the results are received. Free gold ores and sulphide associated gold ores are evident over the area. MRP also received additional inquiries over the Nimbus Project, but the company deferred all the inquiries and focussed over the Boorara Gold Project.
During the quarter, MRP entered into a merger agreement with Intermin Resources Ltd (ASX: IRC) with a new name, Horizon Minerals Limited and a combined mineral resource of around 1.15Moz gold. IRC is an Australian based metal and mining company exploring gold, nickel, copper, and vanadium/molybdenum through its key projects, Richmond oil shale-vanadium-molybdenum project, Menzies gold project, and Nanadie Well prospect.
The merger of MRP and IRC is expected to be implemented in early June 2019. Under the scheme of arrangement, MRP shareholders are entitled to shares of IRC in the ratio of 1.8227:1, i.e., MRP shareholders will get 1 share of IRC for 1.8227 shares of MRP. In the new entity, IRC will have 55% interest, and MRP will hold the remaining 45% interest.
Post the merger; the combined entity plans to become an emerging mid-tier gold production business for which it will commence a Feasibility Study for the integrated development of the existing gold projects.
During the quarter, MRP reported net cash used in operating and investing activities of A$639 K (as compared to the guidance of A$550 K as per 25 October 2018 report) and A$4 K respectively. For the first half of FY19, it reported the same as A$ 1.948 million and A$ 3K respectively. MRP did not have any cash flow from its financing activities during 2Q19 as well as 1H19. It reported a net cash balance of A$1.059 million at the end of the period, i.e., 31 December 2018. For the next quarter, the company estimates a net cash outflow of A$550 K.
Looking at MacPhersons Resources Limited’s stock performance and the return it has posted over the last few months, the stock has generated a positive return of 6.85% during the past three months. It closed the day’s session at A$0.075 with a plunge of 3.846% in the price during the day’s performance. MRP has 351.03 million shares outstanding with a market cap of circa A$27.38 million.
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