Dynacor Gold Mines (DNG.TO) has announced a financial update last week, stating the company is now debt-free after paying off the last debenture for $1.2M. As the company now has a working capital of approximately $16M and a market capitalization of just over$45M, Dynacor might be an attractive investment possibility. Dynacor is currently trading at 5X the net profit over the past four quarters.
There’s one issue we’d like to highlight again. The company was struggling with a possible fine of $44.3M issued by the Peruvian tax authorities for the fiscal years 2003-2009. But in December 2012 Dynacor Gold sold Minera Dynacor for a symbolic dollar to a non-related third party, and is thus no longer liable for this potential tax problem.
Now this overhang has been solved, the company can now focus on constructing its new 300tpd mill in the Chala district, as well as exploring their Tumipampa Project.
> Click here to read the press release
Disclosure: The author currently holds no position in Dynacor Gold. Please see our disclaimer for current positions.
