Dear GS Mining Company Investors,
In our last letter, we wrote to describe the findings in the January assay report. As we said then – the results were remarkably positive with samples coming in as high as 6.1 ounces per ton. Since then, we’ve kept digging and kept assaying and the latest results are in. Five samples were tested, and gold was found in every sample. This time the highest reading was 2.66.
Let’s put this in context so you can understand how encouraged we are and why.
As this letter was being prepared, a report appeared in the financial press of a gold discovery in India of 9,000 tons of ore hosting gold. This seemingly “big” news was tempered in the small print by the disclosure that the average gold yield in India is 3 grams per ton – which translates into 0.1 ounces. That’s a grand total of 900 ounces of gold.
But take a look at the expert third party reports attached to our website. According to those reports, the Bates Hunter alone (not including the Clay and Carr mines) contains somewhere between one and three million ounces of gold. So, you can see why we’re so excited, especially with gold over $1600 an ounce.
As promising as these numbers are, you, our investors, may be asking, “What does this all mean for me?” Allow us to provide one possible explanation.
The bottom line for investors is the business’s valuation. Our goal is to generate $200 million gross and $120 million net revenue (with additional expansion thereafter). Publicly traded gold mining companies are priced at an average of twenty times earnings. If that multiple sticks, we could reach a market valuation of $2.4 billion. Token holders would be receiving pro-rata shares of a $200 million pool and equity holders would receive distributions from no less than 80% of net. One would expect that tokens would be publicly traded in a manner analogous to publicly traded stock – as the business prospers the stock price rises. Even now, before a fully developed public market, we are selling tokens at $4 each, a significant increase from our ICO two years ago.
We can’t guarantee the above results. What we can guarantee is that we will do whatever we can to succeed and to reward all of you for your faith in us.
In the last two months we’ve taken 13 samples from the 240-foot level and every sample has found some level of gold. A 1932 study of the Bates Hunter reports that the last person known to have reached the bottom of the main shaft found gold veins as wide as his outstretched arms. We believe there are millions of ounces of gold waiting for us – and we are on the way to making Central City be once again, as declared by National Geographic, “the richest square mile on earth.”.
GS Mining Company
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Robert C. Herdina
EVP of Corporate Finance
CAUTIONARY STATEMENT FOR PURPOSES OF THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This quarterly report may be deemed to contain “forward-looking” statements. We desire to take advantage of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 and we are including this statement for the express purpose of availing ourselves of the protections of such safe harbor with respect to all of such forward-looking statements. Examples of forward-looking statements include, but are not limited to (i) projections of revenues, income or loss, earnings or loss per share, capital expenditures, growth prospects, dividends, capital structure and other financial items, (ii) statements of plans and objectives of ours or our management or Board of Directors, including the introduction of new products or services, or estimates or predictions of actions by customers, suppliers, competitors or regulating authorities, (iii) statements of future economic performance and (iv) statements of assumptions underlying other statements and statements about us or our business.
Our ability to predict projected results or to predict the effect of any legislation or other pending events on our operating results is inherently uncertain. Therefore, we wish to caution each reader of the report to carefully consider specific factors, including competition for products, services and technology; the uncertainty of developing or obtaining rights to new products, services or technologies that will be accepted by the market; the effects of government regulations and other factors discussed herein because such factors in some cases have affected; and in the future (together with other factors) could affect, our ability to achieve our projected results and may cause actual results to differ materially from those expressed herein.