Newlox Gold (CSE: LUX, PINK: NWLFX, FWB: NGO) is an early-stage junior mining company in Costa Rica. The company is unique; Newlox is already in production! Ryan Jackson (CEO) took the time to sit with First Phase Media to bring more details about the company.

Company Overview

Newlox Gold is an Environmental, Social, and Gold (ESG) producer company involved in Costa Rica. Producing in Costa Rica represents many opportunities) and is under the National Instrument 43-101. Costa Rica is considered the most stable country in the region and has been a democracy since 1948 (ranked #1 in Central America for freedom by the Fraser Institute. The company currently holds two projects, Plant 1 and Plant 2 (Boston Project).

On Plant 1, it is currently in production, and the company targets to ramp it up to 80 tons per day (TPD). On the whole scale, there should be a recovery of 6,500 oz per year, equivalent to $14.7M (oz gold price of August 19: $2,269). Its second project, Plant 2, will be much more extensive and generate more revenue. About data, the project’s CAPEX equals $2M, and its construction is underway. The Boston project should enable the recovery of over 20,000 ounces of gold per year, representing $46,2M (with August 19 gold value).

"We do believe that each of our projects will be successful. With both projects at full scale, we should be producing 26,500 oz of gold per year.”

On its 5-year plan, Newlox Gold plans to reach more than 145,000 ounces per year by commissioning multiple small and midsize plants. All the company’s CAPEX for expansion projects will be internally funded from profits and paid back in less than a year, which provides the company an organic growth and investors some safety against uncontrolled share dilution.

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Who is the CEO and their team?

Ryan Jackson, President & CEO – Holds degrees from McGill University in environmental science, emphasizing human health and political science. He has worked in the mining industry both in the field and in the boardroom and spent three years as the Canadian editor of an international mining industry magazine. Ryan’s experience in the industry includes fieldwork, primarily in Latin America, and business development in North America, Europe, and East Asia.

Ryan is excited to come into the business and get started with junior mining, and build something real that delivers value for shareholders and stakeholders financially and socially. Ryan’s team is divided into the North American-Canada-based part (corporate) of the team and the Central-American one (operational).

Financials

On March 4, 2022, the company shared its financials, and all we can say is they are great. Indeed Newlox reported an astonishing 145% quarterly growth, with revenues improved from $320k to $784k. The company’s balance sheet enormously improved as Newlox reported a slight comprehensive loss for the period of $49.5k compared to $489k during the previous quarter.

“When you consider that operating at around one-quarter of the final full-scale operations was just shy of profitability, you can extrapolate and see that these projects are designed to have solid margins.”

The company reported a clean balance sheet with $4.4M in cash for $6.6M in total assets for no debt. Newlox has 132M shares outstanding, 30M warrants, and 8M options. Insiders currently own approximately 20% of the shares, and about 25% are held by “friendly hands,” which are the company’s founding investors. Newlox doesn’t have much institutional onboard because it doesn’t follow the standard path for a junior mining company. Although it has been challenging for the company to secure financing, Ryan Jackson is confident that the upcoming shift will happen in Newlox soon as the company will become “institutionalized” with revenues coming through, which should lead Newlox to become a medium-sized producer in the medium term.

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“Warrants for us represent a big part of our financing strategy, and it is a mechanism that rewarded the company.”

Share Movement

LUX is traded at $0.145 (August 19) for a meager $19.6M market cap. It is far from its 52-week high of $0.44 and is close to its 52-week low of $0.125. Given the company’s soon to become profitable, its stock price is strongly undervalued. Newlox gold is traded in Canada, the USA, and Germany (CSE: LUX, PINK: NWLFX, FWB: NGO). The stock price is halted as the company didn’t fill its full-year statement on a required day. Besides, management expects the financial statements to be filed this week. The company also states it hasn’t received any points of material concern from the auditors.

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Bottom Line

Newlox Gold (CSE: LUX, PINK: NWLFX, FWB: NGO) is a unique early-stage mining company as the company is already producing. It has a strong balance sheet with $4.4M in cash for no debt and will fund all its new projects internally with profit generated from plants. Another great piece of information is the company has the advantage of being supported by the government as Newlox helps to create sustainable economic growth in artisanal mining districts while providing environmental and social benefits. Newlox is under the radar and well positioned to witness rapid organic growth.

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