(Dallas, TX. – October 4, 2011) StockGuru Shines its Spotlight on Dacha Strategic Metals Inc. (TSX-V: DSM) (OTCQX: DCHAF). The Company announced yesterday that the estimated market value of its Rare Earth metals inventory. As of September 30, 2011, the estimated value of its metals inventory was US$121.0 million, a decrease of US$14.2 million, or 10.5%, from the estimated value of US$135.2 million at August 31, 2011, as reported in the Company’s September 2, 2011 press release. The Company closed on Monday, October 3, 2011, down 6.96 percent at $0.5562, trading in a fifty-two week range of $1.246 – 0.35.
Assets include metal inventory, cash and marketable securities. At September 30, 2011, in addition to its metal inventory, which had an estimated fair market value of US$121.0 million, the Company’s equity investments had an estimated fair market value of approximately US$1.9 million and cash of approximately US$3.3 million for a total of US$126.2 million, or US$1.62 per share, based on 78.1 million shares outstanding, or, US$1.37 per share on a fully diluted basis of 98.7 million shares outstanding.
Company Update
Dacha continues to execute under its Normal Course Issuer Bid and has purchased 1.4 million shares for cancellation since its AGM on September 15th, 2011. As of September 30, 2011, the Company has purchased and cancelled a total of 3,450,000 shares of Dacha at an average price of $0.91 as part of its on-going Normal Course Issuer Bid.
Dacha notes that the market has reacted strongly to the recent pullback in rare earth prices, with Dacha’s share price dropping approximately 30% while its inventory value fell only 10% over the same period from the Company’s last net asset value update on August 30th 2011. Dacha believes the severe curtailment of heavy rare earth mining and separation combined with speculators exiting the market will have a significant positive influence on heavy rare earth prices in the next 90 days. Moreover, while Asian buyers have been relatively inactive in the market since August, the Company has seen a rise in inquiries in the last two weeks. Dacha maintains its inventory in two London Metal Exchange warehouses in Korea owned and operated by Pacorini Metals, a Glencore company. The Company’s inventory is physically audited at the end of each quarter and its auditors were on site on September 30th.
As at September 30, 2011, Dacha’s physical inventory portfolio consisted as follows:
| Metals Inventory 9/30/2011 |
Grades* | Quantity (Kg) |
Spot Price/kg (US$) |
Market Value (US$millions) |
| Busan, South Korea | ||||
| Dysprosium Oxide | 3N+ | 15,000 | $2,295 | $34.4 |
| Dysprosium Fe | Santoku | 12,000 | $2,450 | $29.4 |
| Gadolinium Oxide | 4N5+ | 9,950 | $265 | $2.6 |
| Lutetium Oxide | 4N+ | 2,900 | $1,150 | $3.3 |
| Neodymium Oxide | 4N+ | 18,000 | $276 | $5.0 |
| Terbium Oxide | 4N+ | 14,000 | $3,153 | $44.1 |
| Yttrium Oxide | 5N | 14,000 | $153 | $2.1 |
| Total: | 85,850 | $121.0 |
| *Grades: |
| 4N = 99.99% |
| 4N+ = 99.99+% |
| 5N = 99.999% |
| 4N5+ = 99.99%/99.999+% |
Dacha’s inventory, including market value, is updated weekly every Monday morning and posted to the “Inventory” tab of its website at www.dachametals.com. Dacha encourages its shareholders and all other interested parties to visit its website regularly and to monitor the ongoing appreciation of its physical inventory of Rare Earth Elements.
About Dacha
Dacha Strategic Metals Inc is an investment company focused on the acquisition, storage and trading of strategic metals with a primary focus on Rare Earth Elements. Dacha is in the unique position of holding a commercial stockpile of Physical Rare Earth Elements. Its shares are listed on the TSX Venture Exchange under the symbol “DSM” and on the OTCQX exchange under the symbol “DCHAF”.
Except for statements of historical fact relating to the Company, certain information contained herein constitutes “forward-looking information” under Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to the Company’s expectations and observations of the industry and trends, the Company’s ability to trade in rare earth elements, the realization value of Dacha’s physical inventory portfolio, proposed investment strategy of the Company, and general investment and market trends. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. Forward- looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Dacha to be materially different from those expressed or implied by such forward-looking information. Although management of Dacha has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. Dacha does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
The market value of the Company’s physical inventory is estimated using price quotes published by two of the largest independent news sources for the metals industry, namely, Asian Metal (www.asianmetal.com) and Metal-Pages (www.metal-pages.com). In cases where these websites do not provide a price quote on the type or quality of metal held in the Company’s physical inventory, the Company relies on a price quote provided by independent third-party industry participants.
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