NetworkNewsWire Editorial Coverage: In volatile economic conditions, smart money seeks stability and moves to safe havens. Historically, one of the safest places and most stable spaces during economic uncertainty is gold, a highly liquid asset that preserves and even increases in value over time and carries no credit risk. The precious metal benefits from multiple levers of demand such as gold jewelry, tech/industrial use and a reserve asset as well as a strategic investment. History has shown that gold’s variable demand pressures enhance a portfolio by improving diversification, providing liquidity and delivering long-term returns. Reacting to uncertainties, many gold mining companies, including GEMXX Corp. (OTC: GEMZ) (Profile), have enjoyed significant growth during the recent volatility. Exploding past startup phase and achieving global growth in mere months, GEMXX is fast approaching a holy grail that differentiates GEMXX from all others in the gold space – a vertically integrated mining company – a unique mine-to-market enterprise that specializes in gold and gemstone mining as well as jewelry creation, production and global sales. GEMXX owns and controls every aspect of the process from gold mining and gemstone finishing to jewelry manufacturing and global distribution. Other larger mining companies may not have the unique vertical integration of GEMXX but are still seeing success in the precious metal sector including Agnico Eagle Mines Ltd. (NYSE: AEM), which recently reported record second-quarter numbers; Barrick Gold (NYSE: GOLD), which anticipates a second half of the year performance that surpasses its first; Newmont Mining (NYSE: NEM), which has received required approvals on a key acquisition announced earlier this year; and Franco-Nevada Corp. (NYSE: FNV), which has established a business model that provides investors with gold price and exploration optionality while limiting exposure to cost inflation.
- Gold has long proven to offer “a robust value that stays relatively consistent over time in terms of its purchasing power.”
- In addition to Snow Creek and Rosella Creek Gold deposits, the pending acquisition of the Yukon Gold Project would significantly increase GEMXX’s gold asset portfolio.
- GEMXX stands out as a leading producer of high-quality finished ammolite jewelry and is the only publicly traded ammolite company in the world.
- GEMXX has achieved significant milestones by establishing a management team with decades of experience and aligning with strategic partners to become profitable sooner than other start-ups.
“Gold has proved, over hundreds and even thousands of years, to be a reliable store of value,” stated a recent “U.S. News & World Report” article, which further observed that “whatever events happen, gold has a robust value that stays relatively consistent over time in terms of its purchasing power.” The article notes that gold can compete against other relatively safe investments such as the U.S. dollar and treasuries, but “because the Fed’s efforts to combat inflation appear to be working, gold looks increasingly attractive compared to assets like [treasuries].”
With that backdrop, the eye-popping progress made by GEMXX Corp. (OTC: GEMZ) in the past several months may prove to be particularly promising. The company reported a whopping 170% increase in revenues year over year in 2022, has no long-term debt, and is on a tear adding owned assets to the balance sheet.
“Our plan to de-risk revenues through production of the world’s most sought-after commodity is happening fast,” said GEMXX CEO Jay Maull. “[By adding] up to four million ounces of gold to the company’s assets, GEMXX will increase shareholder value and provide a long-term, stable and profitable investment for years to come. We will not only enjoy a significant reduction in the cost of goods for our entire gold jewelry line, but this acquisition will bring the company closer to our goal of becoming vertically integrated.”
GEMXX began this year with more than 1,400 acres already in its resource portfolio, including the Snow Creek Mine site, consisting of 498 acres with 80% mineable, and the Rosella Creek mine site, consisting of 240 acres with 90% mineable. In September, GEMXX signed a binding letter of intent (“LOI”) to acquire an initial 50% stake in the Yukon Gold project, which consists of 145 full Yukon quartz claims and is located in Canada’s Yukon Province; the acquisition is pending full approvals and due diligence.
“In addition to our Snow Creek and Rosella Creek Gold deposits, the acquisition of the Yukon Gold Project will significantly increase the company’s gold asset portfolio,” observed Maull.
An Ammolite Specialty
The vertical integration of GEMXX includes planned market dominance of ammolite, a rare, iridescent, gem-quality material cut from the fossilized shells of extinct sea creatures. Found only in the Bearpaw Formation on the eastern slopes of the Canadian Rockies, this organic gemstone has a dazzling range of colors and patterns and is highly desired for artisanal decor pieces and fine jewelry. The only publicly traded ammolite company in the world, GEMXX has more than $600 million in ammolite reserves, including its 360-acre Northern Block, a proven resource, and its 217-acre Southern Blocks, both in southern Alberta.
Leading independent market research companies such as Data Monitor and GIA estimate the worldwide market for luxury or premium lifestyle products, which include gems and jewelry, at more than $90 billion annually and growing. Ammolite sales around the world have seen unprecedented growth over the past 20 years. Worldwide retail sales are now estimated to top $100 million for this boutique gemstone, and with colored gems sparking a new trend in the jewelry space, that number appears certain to increase.
“While gemstone jewelry isn’t a new trend, it certainly is the most sustainable one,” a recent Fashionisto article reported. “People have preferred colored jewels since antiquity for protection, fortune, good health and love. You can expect the similar favoritism in the future too. The market has significantly grown in the past ten years and expected to go even higher in the next decades.”
Experience and Expertise
The success of any company is often determined by its management team — and GEMXX excels in both experience and expertise. GEMXX executives bring more than 160 years in gold, gemstone and jewelry production expertise along with global operations and sales experience. Team members possess extensive backgrounds in every facet of the gold and gemstone business.
During the challenges created during the pandemic, the company proved what seasoned management can do. While many competitors had to ultimately scale down or restructure, GEMXX double its production volume to meet demand while continuing to grow operations and remain cash flow positive. This often-overlooked asset — a team rich with expertise — allows GEMXX to excel in product development, maintain rigorous quality control measures, and maximize profitability. GEMXX leverages its collective wisdom to drive innovation, deliver exceptional products and optimize business strategies to achieve both short-term and long-term objectives.
Short-term, the company is involved in a fully qualified Reg-A offering, with the goal of raising $6 million in investment funding. These funds will allow the company to break ground on a new, large-scale ammolite mine and expand current gold mine operations as it commits to meeting the ever-increasing global demand for its products. In addition, the company plans to complete SK-1300 resource reports on already owned gold-producing assets as well as recently acquired gemstone resources. These reports are expected to increase the company’s resource base to $976 million and resource book value from $14.7 million to $97.6 million, or 6.6 times its current value.
Finally, GEMXX is completing financial audits and intends to trade on the OTCQX, with an eye on ultimately uplisting to the New York Stock Exchange or NASDAQ. Such a move could create more opportunities for growth and provide even better shareholder value.
In addition, GEMXX is committed to the long-term sustainable and environmentally responsible development of its resources. Mining companies operating in Canada earn a stronger ESG score than all other mineral-rich countries because of the country’s stringent environmental regulations, strong governance, and commitment to safety and community.
Clearly, GEMXX has achieved significant milestones, and it’s worth noting that the company’s run has likely just begun. “We are tremendously pleased with the development of the company over the past several months, and we are extremely excited for the anticipated growth,” said Maull. “We look forward to updating shareholders as we move into full gold and gemstone production. We intend to do everything necessary to drive shareholder value.”
Hard to argue with Maull’s projections about growth and shareholder value. GEMXX is the world’s only publicly traded ammolite company and is uniquely positioned to quickly become vertically integrated, controlling each stage of gold mining and gemstone production all the way through jewelry creation, manufacture and global distribution.
The Only Thing Certain Is Uncertainty
Other mining companies are also in the quest for mining success.
Agnico Eagle Mines Ltd. (NYSE: AEM) is a senior Canadian gold mining company, producing precious metals from operations in Canada, Australia, Finland and Mexico. The company has built a portfolio of high-quality exploration and development projects in these countries as well as in the United States. Agnico Eagle recently announced record quarterly gold production and solid cost performance. Agnico Eagle is a partner of choice within the mining industry, recognized globally for its leading environmental, social and governance practices.
Barrick Gold (NYSE: GOLD) is a senior gold mining company that continues to advance major projects that will drive value delivery in the long-term through organic growth. Barrick president and CEO Mark Bristow recently reported that improved performances from its Carlin complex in Nevada, Kibali gold mine in the Democratic Republic of Congo and Lumwana copper mine in Zambia have laid a sound foundation for production in the second half of the year which, as guided, is expected to surpass the first.
Newmont Mining (NYSE: NEM) is the world’s leading gold company and a producer of copper, silver, zinc and lead. The company boasts the industry’s strongest balance sheet and a global portfolio with the size and scale to make decisions that deliver on its strategy. Earlier this year, Newmont announced plans to acquire Newcrest Mining Limited, and most recently the company announced that the Securities Commission of Papua New Guinea (“SCPNG”) has granted the necessary exemptions and other requested confirmations to allow the company to move forward.
Franco-Nevada Corp. (NYSE: FNV) is the leading gold-focused royalty and streaming company. The company has built a large, diversified portfolio of cash-flow producing assets and is committed to a business model that provides investors with gold price and exploration optionality while limiting exposure to cost inflation. The company is working to become the “go to” gold stock for the generalist investor, with its emphasis on minimizing risk, paying dividends and maintaining a strong balance sheet combined with high environmental, social and governance standards.
The time has never been better to consider investing in mining, whether gold or rare gemstones — or both. With the one thing certain about the economy in the near future being its uncertainty, a space known for historically offering safety and security may be the best place to land.
For more information about GEMXX, please visit GEMXX.
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