RRS.V - And beyond.


Rogue Resources (RRS.V) entails three divisions. Rogue Stone-selling quarried limestone for landscape applications; Rogue Quartz- focused on advancing its silica/quartz business with the Snow White Project in Ontario and the Silicon Ridge Project in Québec; and Rogue Timmins with the gold potential at Radio Hill and an ownership position in the private company EV Nickel, exploring in the Shaw Dome.


Coverage: June 2017, August 2017, October 2017, May 2018, October 2018, April 2019. January 2020 and September 2020.


News Releases


Oct. 7 - Commercial Production, More Than $1M in Sales of Landscape Stone to Date, Update Call Next Wednesday: Ramp-up continued at the Bobcaygeon and Orillia quarries, with a strong summer continuing into fall; May-June-July sold 5,409 tons realizing $82/ton with direct expenses of $42/ton; August sales were 2,422 tons, averaging $85/ton and September sales were 2,668 tons, averaging $80/ton; Total sales for June-July-August allow Rogue Stone to declare Commercial Production as of September 1st; Corporate Update conference call will be held Oct. 14 at 12:00pm EDT.


Dec. 15 - AGM Results, Sales Growth Continues in Landscape Stone, Update Call in January: Rogue Stone's ramp-up continued at the Bobcaygeon and Orillia quarries, with strong fall sales: August-September-October sold 7,993 tons realizing $80/ton with direct expenses of $39/ton. Rogue declared Commercial Production on September 1st and filed a two-month Income Statement. Update conference call on Tuesday, January 12th, 2021 at 12:00pm EST.


Jan. 11 - Strong Stone Sales to finish 2020, Creating a Nickel Subsidiary, Amended Snow White Terms, Update Call:

Rogue Stone’s ramp-up continued with good sales through the first 2 months of its Q2-2021; In November-December Rogue Stone sold 4,815 tons realizing an average price of $72/ton; To date, Rogue Stone has sold more than 20,000 tons, realizing more than $1.5M in sales.


Rogue Timmins: transferring the Langmuir Project into a new, wholly owned Nickel subsidiary;


Rogue Quartz: Partnered again with Option Holders to improve payment terms on the Snow White Project: Rogue amended a December 2020 payment of $120,000 to become a payment of $10,000 and 200,000 shares. In addition, the annual $80,000 cash payments due each December in each of the following two years have been amended to become annual deliveries of shares of the Company with a worth of $16,000. Finally, the New Amendments adjusted the production royalty from $1 per tonne on the first 500K tonnes of production to $3/tonne of the first 100K tonnes of production and $1/ tonne of the next 200K tonnes. All other terms of the Agreement remain unchanged


A Corporate Update conference call will be held with investors on Tuesday, January 12th, 2021 at 12:00pm EST


Mar. 5 - Selling Langmuir Project: Further to its news release dated January 11, 2020, the Company intends to transfer its ownership and rights in the Langmuir project located southeast of Timmins, Ontario (the "Langmuir Project") to EV Nickel Inc. ("EVNi"), a private company incorporated under the laws of Ontario.


EVNi is a recently created private Ontario company established to advance the exploration of Langmuir. Pursuant to the terms of the Agreement, Rogue will hold at least 20% of the shares of EVNi at closing of the Concurrent Financing and after the subsequent transfer of the Langmuir Project. The initial board of directors of EVNi will constitute five members and include two Rogue representatives.


Mar. 26 - Rogue Update: Langmuir Project Sold to EV Nickel Inc: a) EVNi closed the first tranche of its previously announced non-brokered private placement for proceeds of more than $1,500,000; b) Rogue has been granted shares for >20% in EVNi and been paid $150,000 in cash; c)Rogue has transferred the Langmuir Project claims to EVNi.


In addition to the consideration paid at closing, a future payment will be received by the Company based on the size of an updated new mineral resource estimate, expected to be completed by EVNi in early 2022. This payment will be up to a maximum of $5,000,000 paid in cash, EVNi shares, or a combination thereof to be determined by EVNi.


Mar. 31 - Update: Strong Stone Sales continue, first Positive EBITDA: a) In Q3-2021, from November-January, Rogue Stone sold 6,914 tons realizing $70/ton with COGS of $37/ton; b) To date, Rogue Stone has sold more than 25,000 tons, realizing close to $2M in sales; c) Rogue realized $72,193 in EBITDA this quarter (first positive quarter ever, circa 1985).


Apr. 1 - Quebec Refuses Silicon Ridge Application: Received a formal refusal from Québec's Ministère des Forêts, de la Faune et des Parcs ("MFFP") regarding the permit application for the Company's Silicon Ridge Project. After 6 years of investment, based on the continued perceived support and explicit signoffs along the way, the Company will now pivot to seek fair compensation of its investment, the project value, and other damages.


Apr. 12 - Appoints new CFO, Landscape Stone Sales continue through February and March: 1) Experienced public company CFO joins Rogue management team 2) In February-March Rogue Stone sold 3,313 tons realizing an average price of $74/ton 3) Average value of limestone sold rises as expected with increased demand for higher value products.


Summary

Despite a limited sustained increase in valuation, Rogue has made significant progress in the last eight months.


Rogue Stone

Both Bobcaygeon and Orillia quarries have been in production and continue generate revenues.


MD&A: The Company reached commercial production with an effective date of September 1, 2020. Total sales of June July-August were 6,987 tons (>6,600 tons) allowing Rogue Stone to reach Commercial Production. As a result, the prior quarter’s Consolidated Interim Statements of Operations and Comprehensive Loss includes Income and Cost of Goods Sold, for only the months of September and October. The current quarter has three full months of commercial production.


Hence, Rogue's Consolidated Interim Statements of Operations and Comprehensive Loss for Q3 2021 and YTD 2021:






Rogue Quartz

RRS.V recently received a rejection for the Silicon Ridge Application from the Québec's Ministère des Forêts, de la Faune et des Parcs (MFFP). RRS.V will seek fair compensation of its investment, the project value, and other damages.


As for Snow White, Rogue negotiated better terms by amending the December 2020 payment of $120,000 to become a payment of $10,000 and 200,000 shares. In addition, the annual $80,000 cash payments due each December in each of the following two years have been amended to become annual deliveries of shares of the Company with a worth of $16,000. Finally, the New Amendments adjusted the production royalty from $1 per tonne on the first 500K tonnes of production to $3/tonne of the first 100K tonnes of production and $1/ tonne of the next 200K tonnes.


Rogue Timmins

The Langmuir Project was sold to EV Nickel Inc. ("EVNi"). The term were a combination of ownership in EVNi (20%), upfront cash ($ 150,000) and up to $5M (cash and/or additional shares) depending of the size of an updated new mineral resource estimate, expected to be completed by EVNi in early 2022.


In Short

The latest earning report was very encouraging. Rogue Stone may very well finish FY 2021 with revenues close to $1.5M. This is significant given the difficulties RRS.V encountered in the past few years in building a tangible business.


The rejection of Silicon Ridge Application is unfortunate but it enables Rogue to move towards seeking compensation. In addition, the sales of the Langmuir assets positions Rogue as a part owner with a decent exposure to exploration.


Furthermore, the situation with Silicon Ridge and Langmuir enables RRS.V to focus on growing the Stone Business. The recent addition of a CFO is positive as it will assist with financing and the evaluation of potential acquisition.


As a reminder, both of the Orillia and Bobcaygeon Quarries have are licensed to produce 20,000 tons a year.


Per MD&A: As of January 31, 2021, Bobcaygeon had completed 14 months of operations and sales but remained in a pre-Commercial Production state until the end of August 2020 (mid Q2-2021). Orillia completed 10 months of operations and sales but also remained in a pre-Commercial Production state until the end of August 2020 (mid Q2-2021).

Hence, RRS.V appears to have additional capacity (i.e. 40,000 tons/year or 10,000/per quarter).


While RRS.V mentioned being interested in acquiring more Quarries, the question now is how many and how quickly? For investors to better appreciate the revenue potential of the business, Rogue will need to provided more details.


At issue, what are the revenue ambitions of the company for FY 2022 and beyond.



DISCLAIMER: The work included in this article is based on current events, technical charts, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decision based solely on what you read here. This publication contains forward-looking statements, including but not limited to comments regarding predictions and projections. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. The content of rally is provided for informational and entertainment purposes only and is not a recommendation to buy or sell any security. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions - rally cannot take responsibility for your investment decisions.

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