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Arianne Phosphate: 8 Different Insiders Have Purchased Shares During The Last 30 Days

August 12, 2014 | About:
maarnio

maarnio

2 followers

1. The Company

One mineral exploration company has seen intensive insider buying during the last 30 days. Intensive insider buying can be defined by the following three criteria:

  1. The stock is purchased by three or more insiders within one month.

  2. The stock is sold by no insiders in the month of intensive purchasing.

  3. At least two purchasers increase their holdings by more than 10%.

Arianne Phosphate (DRRSF) primarily focuses on the development of the Lac à Paul phosphate-titanium deposit located in the Saguenay-Lac-Saint-Jean region of Quebec, Canada.

Shares outstanding (May 31, 2014)

87,087,755

Warrants

5,217,500

Options

6,142,909

Share price

$0.92

Market cap

$80.1 million

Enterprise value

$86.1 million

Tickers

DRRSF,TSXV:DAN

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1.1 History

  • The company was founded in 1997 under the name Arianne Resources.
  • Arianne was listed on the Toronto Stock Exchange in 2003.
  • In May 2013, the company changed its name to Arianne Phosphate.

1.2 Business model

The company is focused on developing its Lac à Paul resource into a major mine.

1.3 Assets

Arianne’s main asset, the Lac à Paul project, is located approximately 200 km north of the town of Saguenay in the Saguenay-Lac-St-Jean region of Québec, Canada.

nimetön.png

(Source: Investor presentation)

Arianne announced the feasibility study results for its Lac à Paul phosphate rock project in October 2013 with the following highlights.

nimetön.png

(Source: Investor presentation)

2. Management

The CEO Brian Kenny has over 30 years engineering and large project development experience. Brian Kenny has been CEO since July 2013. Collectively, Arianne’s management team and board have over 240 years of industry experience.

nimetön.png

(Source: Investor presentation)

2.1 Insider ownership

Here is a table of Arianne’s insider activity during the last 30 days.

Name

Title

Trade Date

Shares Purchased

Prospectus

Current Ownership

Increase InShares

Dominique Bouchard

Vice-Chairman

Aug 1

20,000

Yes

36,700 shares

+119.8%

James Cowley

VP

Aug 1

30,000

Yes

103,788 shares

+40.7%

David Debiasio

Director

Aug 1

5,000

Yes

30,000 shares

+20.0%

Pierre Fitzgibbon

Chairman

Aug 1

75,000

Yes

150,555 shares

+99.3%

Marco Gagnon

Director

Aug 1

11,000

Yes

50,000 shares

+28.2%

Brian Ostroff

Director

July 31

10,000

Yes

321,100 shares

+3.2%

Siva Pillay

Director

Aug 1

10,000

Yes

10,000 shares

from 0 to 10,000

Steven Pinney

Director

Aug 1

25,000

Yes

25,000 shares

from 0 to 25,000

There have been 186,000 shares purchased by insiders during the last 30 days. Seven of these eight insiders increased their holdings by more than 10%.

Here is a table of Arianne’s insider activity by calendar month.

 

Insider buying / shares

Insider selling / shares

August 2014

176,000

0

July 2014

10,000

0

June 2014

0

0

May 2014

0

0

April 2014

23,500

0

March 2014

0

0

February 2014

0

0

January 2014

0

0

December 2013

145,366

0

November 2013

0

0

October 2013

20,000

0

September 2013

0

0

August 2013

0

0

July 2013

54,000

0

June 2013

0

0

May 2013

0

0

April 2013

0

0

March 2013

0

0

February 2013

0

0

January 2013

0

0

(Note: The table doesn’t include shares acquired or disposed under a purchase/ownership plan. There have been 21,307 shares acquired pursuant to a purchase/ownership plan since January 2013.)

There have been 428,866 shares purchased, and there have been zero shares sold by insiders since January 2013. The month of August 2014 has seen the most insider buying.

2.2 Compensation

Here is a table of the management’s compensation during the last three years.

nimetön.png

(Source: Management Proxy Circular)

The management’s total compensation was highest in 2011.

3. Financial Summary

3.1 Current situation

Arianne reported the first-quarter financial results on May 29 with the following highlights:

Revenue

$0

Net loss

C1.4 million

Cash

C$5.3 million

Debt

C$11.8 million

On July 31, Arianne closed a C$5.6 million financing.

3.2 Historical Developments

Here is a table of Arianne’s revenue and earnings since 2004.

Year

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Revenue (C$ in millions)

0

0

0

0.05

0.03

0

0

0

0

0

Net loss (C$ in millions)

0.3

0.5

0.3

0.7

1.5

1.3

2.9

3.4

5.4

6.4

EPS (diluted)

-0.12

-0.09

-0.04

-0.05

-0.09

-0.06

-0.10

-0.06

-0.08

-0.08

(Note: Arianne had a 5-for-1 reverse split in July 2009. The EPS numbers have been adjusted accordingly.)

In 2007 and 2008, Arianne’s revenue was only interest income.

4. Shares

Here is a table of Arianne’s number of shares since 2004.

Year

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Number of shares (millions)

2.0

5.2

10.7

15.7

17.0

21.1

29.1

61.3

68.5

78.0

(Note: Arianne had a 5-for-1 reverse split in July 2009. The number of shares have been adjusted accordingly.)

Arianne’s number of shares have grown 3,800% since 2004.

5. Outlook

Arianne’s goal is to move the Lac à Paul project into production by 2018.

nimetön.png

(Source: Investor presentation)

6. Competition

Arianne's production cost is equivalent to $60/t when adjusted for 32% P2O5 concentrate, which puts Arianne around the middle of the cost curve.

nimetön.png

(Source: Investor presentation)

7. Risks

The main risks are no revenues, negative earnings, and the price of phosphate rock. The price of phosphate rock peaked in 2008.

nimetön.png

(Source: Investor presentation)

Arianne is also a penny stock.

8. Conclusion

There have been eight different insiders buying Arianne and there have not been any insiders selling Arianne during the last 30 days. The eight insiders purchased their shares at $0.91 (C$1.00). I believe Arianne could be a good pick below $0.91 based on the intensive insider buying.

nimetön.png

(Source: Investor presentation)

Disclosure: The author has no positions in any stocks mentioned.

About the author:

maarnio
I have 15 years of investing experience. I have traded stocks, commodities and Forex markets.

Rating: 5.0/5 (1 vote)

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