Titan Mining (TSX: TI, OTC: TIMCF) is a high-grade zinc-focused company that 100% owns the Empire State Mine. Strong from its 100+ years of experience in mining, the ESM produced 44M tons at an average mill head grade of 9.4% zinc. As Titan Mining says, the company is “built for growth, focused on value, and committed to excellence.” The stock witnesses an insane increase in its trading volume. On February 17, it was 1907% up compared to its trading average. Is something cooking? 

Company Overview

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Titan Mining is a mining company showing many strengths. The company focuses on its flagship project, the Empire State Mine, located in Northern New York state, USA. The mine is 100%-owned and delivers high-grade zinc. The area is well known for returning zinc. The district produced 46M+ tons at an average grade of 9.3%  zinc from 7 different mines within only a 30-mile radius. 

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In 2022, Titan Mining had an outstanding year. It produced a record 52.5M payable pounds of zinc, an 18% production increase compared to 2021. Most of the resources are extracted at the #4 mine. The company continues to target large high-grade deposits thanks to new ideas and a modern approach to exploring and discovering. Titan Mining already has its targets for 2023. The production guidance is estimated to be between 54M to 58M pounds of payable zinc.

The estimated C1 cash cost* for 2023 ranges from $1.08 to $1.12 per payable pound, while the estimated AISC varies from $1.14 to $1.18 per payable pound. Until the end of H1 2023, when treatment charges will be known with certainty, both C1 Cash Cost and AISC will be significantly impacted. Spending on exploration will be concentrated on district targets where the company has private mineral rights to more than 80,000 acres. Positive exploration outcomes will determine the timing and scope of the exploration program. If necessary, the company may allocate additional funds above the budget. Titan Mining also set a fixed zinc pricing arrangement for approximately 30% of its forecasted zinc production during an 11-month period at $1.55 per pound of zinc. 

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“Fiscal Year 2022 was a record year for production at Titan’s Empire State Mine. With the recently announced production forecast of 54-58 million pounds of payable zinc for the fiscal year 2023, the adoption of a quarterly cash dividend, and our plans to develop the Sphaleros project, it was prudent to lock in a portion of Titan’s cashflow while maintaining significant exposure to upside movements in the zinc price.  The forward sales will help ensure that we can deliver on our financial objectives for the year and reduce risk."

Don Taylor, President, and CEO

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The Sphaleros mine project is a fully-permitted area with shallow zones of the near-mine remnant of mineralization freshly discovered in November 2019. The ongoing definition drilling continues to expand the known mineral resource, and ore extraction of the pumphouse pit is expected in 2023. The company believes there is a real potential to add low-cost production and feed over 3,000 tpd of excess capacity to increase production and dramatically lower costs.

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Share Structure / Financials

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Titan Mining holds a solid balance sheet. As of September 30, 2022, the company had $13.5M in cash and cash equivalents for a total of $79.1M in total assets. With a deposit valued around 1.5bn this company trades at only 4% of its deposit value. The company doesn’t have significant liabilities. For 2022, the company’s operations generated $10.36M cash flow from operations, including a net income of $3.14M for a total revenue of $48.12M, and have projections for 80m in 2023 (+60% YoY). A solid piece of information you want to hear is the company generates quarterly dividends. For each share you own, the company will give you $0.01, a great way to invest while receiving a passive income! 

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On June 7, 2022, Titan Mining closed a $40M credit facility from the National Bank of Canada. The credit facility bears interest a SOFR plus 2.25% or National Bank’s base rate plus 1.25%, a standby fee of 0.5625%, and has an 18-month maturity with an annual extension option. 

About the share structure, the company stated 139M shares issued and outstanding and 166M shares fully diluted. On February 18, the stock price closed at $0.64. The 52-week range varied from $0.41 to $0.76, but the most exciting part was the volume. The data is unusually high because the volume was up +1500% for the last trading days compared to the average volume of 33.5k. 

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Past Successes

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Titan Mining is also part of the Augusta Group of companies, which currently holds 3 companies right now: TSX:SLS (750m mkt cap), TSX:G (150m mkt cap), TSX:TI (70m mkt cap). Augusta’s past 4 companies got bought out for a combined total of $5.9 Billion and bringing an average of a 5,900% return. It is no secret this group knows how to operate a mining company to success. Titan is in good hands and is positioned among some of the best success stories in the industry. 

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Bottom Line

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Titan Mining (TSX: TI, OTC: TIMCF) gathers several strengths. The company heavily produces zinc with a 2023 production guidance upper than the previous year, holds a solid balance sheet, and even pays quarterly dividends. The volume significantly increased, showing investors have a strong interest in the company. If you don’t want to invest in the company yet, put at least the ticker in your watchlist to follow its story. 

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*C1 cash costs are defined as the cash cost incurred at each processing stage, from mining through to recoverable nickel delivered to the market, net of by-product credits.

**All-in Sustaining Costs include adjusted operating costs and sustaining capital expenditure, corporate general and administrative expenses, and exploration expenses, reflecting the full cost of gold production from current operations.

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