Summary and Analysis of Key Points

Overview

• Magellan Minerals was incorporated in 2010 and its principal business is the acquisition and exploration of mineral resources.
• The company has not generated any significant revenue and relies on the sale of securities and borrowings to fund its operations.
• Magellan has made several acquisitions of mineral properties in recent years, including the Center Star Gold Mine in Idaho, various projects from Gold Express Mines, Inc., and the Kris Project in California.
• The company’s primary focus is to advance these mineral projects towards resource definition and eventual development.

Financial Performance

• For the three months ended June 30, 2024, Magellan reported a net loss of $74,137, compared to a net loss of $47,567 in the same period in 2023.
• The increase in net loss was primarily due to higher general and administrative expenses, particularly professional fees and stock-based compensation.
• For the six months ended June 30, 2024, Magellan reported a net loss of $204,402, compared to a net loss of $78,488 in the same period in 2023.
• The larger net loss was again driven by higher general and administrative expenses, as well as increased interest expense and a smaller gain on change in derivative liability.

Liquidity and Capital Resources

• As of June 30, 2024, Magellan had $3,913 in cash and a working capital deficit of $1,937,578.
• The company’s ability to continue as a going concern is dependent on its ability to generate future profits and/or obtain necessary financing.
• Magellan anticipates that future funding will come in the form of additional loans from officers, directors or shareholders, or equity financing from the sale of common stock.
• Cash used in operating activities during the first six months of 2024 was $110,186, compared to $54,247 in the same period in 2023, reflecting the higher net losses.
• Cash used in investing activities in 2023 was $100,000 for the acquisition of mineral properties, while there were no investing activities in 2024.
• Financing activities provided $114,000 in cash in the first six months of 2024, compared to $156,299 in the same period in 2023, primarily from proceeds of notes payable.

Strengths and Weaknesses Strengths:

• Magellan has acquired several promising mineral projects, including the high-grade Center Star Gold Mine, that have the potential for resource development and future production.
• The company has been able to raise capital through the sale of securities and borrowings to fund its exploration and acquisition activities.

Weaknesses:

• Magellan has not yet generated any significant revenue from its mineral properties and continues to rely on external financing to fund its operations.
• The company has accumulated significant losses over its history and its ability to continue as a going concern is uncertain.
• Magellan’s exploration and development efforts will require substantial additional capital, which may be difficult to obtain.

Outlook

• Magellan’s primary focus will be on advancing its Center Star Gold, Kris, and copper projects towards resource definition and potential development.
• The company will need to secure additional financing, likely through equity sales or borrowings, to fund its ongoing exploration, permitting, and development activities.
• Magellan’s ability to successfully develop its mineral properties and achieve profitability remains uncertain and will depend on its access to capital and the results of its exploration and development programs.