Quick Glance on Two Mining Stocks – Alba Mineral Resources & Wishbone Gold

Summary

• Alba Mineral Resources received permission for bulk sampling and drilling programme at Clogau Gold Mine.
• Alba Mineral Resources deferred the start of the drilling programme at Amitsoq to 2021.
• Alba Mineral Resources issued new shares in August 2020.
• Wishbone Gold plans to start drilling programme at Wishbone II gold project in Queensland, Australia.
• Wishbone Gold reported total sales of USD 3.6 million in Q1 FY2020.
• Wishbone Gold issued new shares in June 2020.

Alba Mineral Resources PLC (LON:ALBA) & Wishbone Gold PLC (LON:WSBN) are two basic materials stock. ALBA and WSBN had a market capitalization of close to £4.88 million and £2.32 million, respectively. Based on 1-year performance, shares of ALBA and WSBN were down by about 48.46 percent and 35.17 percent, respectively. Shares of ALBA and WSBN were down by about 5.94 percent and 16.00 percent, respectively from the previous closing price (as on 20 August 2020, before the market close at 4.22 PM GMT+1).

Alba Mineral Resources PLC (LON:ALBA) – Planning trenching programme at Clogau Gold Mine in Q4 2020

Alba Mineral Resources PLC is a UK based company engaged in mining and exploration of minerals. It has an interest in mining projects in Greenland, Wales and Ireland. It has also made investments in UK oil & gas sector. Alba operates mining projects such as Amitsoq graphite, Thule Black Sands, Melville bay iron ore, Inglefield Land polymetallic and Gold mines of Wales. The Company also owns 11.76 percent of Horse Hill oil & gas. The Company is included in the FTSE AIM All-share.

Clogau Gold Mine

On 14 August 2020, the Company received permission for bulk sampling and drilling programme at Clogau Gold Mine from North Wales Minerals and Waste Planning Service. Alba plans to commence work at the mine from 1 September 2020, and it has started mobilizing contractors to site. The Company has planned the trenching programme at the mine in Q4 2020, and the permission for the trenching programme is a separate affair. In the bulk sampling, process extracts would be sampled from the mine development area. Bulk sampling would be performed along with rock chip sampling, channel sampling and drilling programme. The drilling programme would include 5 to 10 holes of the total depth of around 500 metres.

Issue of New Shares

On 3 August 2020, the Company reported the issue of 692,307,692 new shares at 0.065 pence per share. Alba Mineral raised gross proceeds of close to £450,000 from new shares. The warrants are issued for every two new shares that have an exercise price of 0.13 pence per share with an expiration of 24 months from the date of issue. The funds raised would be used to speed up the activities at Clogau Gold Mine.

Share Price Performance Analysis

1-Year Chart as on August-20-2020, before the market close (Source: EODHD/Others, Thomson Reuters)

Alba Mineral Resources PLC's shares were trading at GBX 0.095 and were down by close to 5.94 percent against the previous closing price (as on 20 August 2020, before the market close at 4:22 PM GMT+1). ALBA's 52-week High and Low were GBX 0.22 and GBX 0.04, respectively. ALBA had a market capitalization of around £4.88 million.

Business Outlook

The main priority of the Company would be Clogau Gold Project in 2020, and it has deferred the drilling programme at Amitsoq to 2021. Alba Mineral would complete metallurgical work and refine drill targets before the start of drilling programme next year. The Company's strategy is identifying undervalued assets with different products that have production history in the past.

Wishbone Gold PLC (LON:WSBN) – Balance sheet remains debt-free

Wishbone Gold PLC is a UK based metal company. The Company has four exploration license in North East Queensland, Australia. The subsidiary of the Company, Black Sand FZE is a gold trading company based in Dubai, and Wishbone Gold Pty Ltd is a gold mining and exploration company in Australia.

Start of Gold exploration at high-grade targets in Australia

On 19 August 2020, the Company stated that it plans to start exploration and drilling programme at Wishbone II gold project in Queensland, Australia. The rock-chip samples have recorded 25.2 gramme per tonne gold at Hanging Valley and 7.32 gramme per tonne gold at Oaky Mill prospect. The Company wholly owns Wishbone II, III and IV projects in Australia. Wishbone II is situated between Charters Towers Gold project, and Ravenswood project and both are gold-producing projects. These projects are expected to have close to 10 million (Au) ounces of gold. The rearrangement of the corporate and capital structure of Wishbone is completed. The Company is debt-free and has the cash to perform drilling and exploration.

First Quarter trading update (ended 31 March 2020) as reported on 30 June 2020

The Company reported total sales of USD 3.6 million in Q1 FY20, which was lower than sales of USD 3.85 million achieved in the same period last year. The FY19 total sales were USD 10.74 million. The Covid-19 disrupted the trade of physical trade, and it was difficult to source gold from Africa and South America after the Emirates airline was grounded in Dubai. Moreover, there was a shortage of gold for physical trading.

Issue of New Shares

On 2 June 2020, the Company reported the issue of new shares of close to 63,459,420 at 1.35 pence per share. Out of the total issued shares, nearly 22.2 million were issued to raise gross proceeds of £300,000, close to 13.0 million shares were issued to pay the directors and management fees of £175,689.02. Wishbone issued approximately 28.2 million shares to convert the outstanding loan of Sanderson Capital Partners Limited and Black Swan FZE and payment to other creditors. The new shares issued converted loans of £292,889.61 and payment to creditors of £88,123.55.

Share Price Performance Analysis

1-Year Chart as on August-20-2020, before the market close (Source: EODHD/Others, Thomson Reuters)

Wishbone Gold PLC's shares were trading at GBX 2.35 and were down by close to 6.00 percent against the previous closing price (as on 20 August 2020, before the market close at 2:30 PM GMT+1). WSBN's 52-week High and Low were GBX 3.70 and GBX 1.06, respectively. Wishbone Gold had a market capitalization of around £2.32 million.

Business Outlook

The Company would start the drilling programme at the main prospect, and it wants to take advantage of the high gold prices. The Company has gold trading company in Dubai, and it faced disruption in the gold supply due to grounding of flights due to Covid-19. The flights have resumed operation on a few routes with a lower capacity. The supply over the short term is expected to remain affected. The new equity issued has strengthened the balance sheet, and the balance sheet is debt-free.