Filing summary
Entity and period: The supplied filing is Jupiter Gold Corporation’s annual Form 20-F for the fiscal year ended December 31, 2020—not an Atlas Critical Minerals filing or a standalone 2020 Q4 report. The filing does not provide separate fourth-quarter results. Financial statements are consolidated and prepared under U.S. GAAP.
Business context
Jupiter Gold is a Marshall Islands-incorporated mineral exploration and development company focused on gold properties in Brazil. It reported multiple wholly owned mineral projects and a modular gold recovery plant, but no SEC-defined mineral reserves. Management’s stated aim is to begin profitable operations, including through mining or partnering on projects.
Financial results and liquidity
| Metric | FY2020 | FY2019 |
|---|---|---|
| Revenue | $0 | $0 |
| Operating expenses | $412,529 | $287,984 |
| Net loss | $430,453 | $312,328 |
| Net loss per share | $0.08 | $0.07 |
| Cash used in operating activities | $285,667 | $159,250 |
| Cash from (used in) investing activities | $(205,216) | $66,478 |
| Cash from financing activities | $500,000 | $150,000 |
At year-end 2020, cash was $67,552; current assets were $258,133, including $190,581 due from related party Brazil Minerals; current liabilities and total liabilities were $10,732; and working capital was $247,401. The reported current ratio was 24.1:1. The company reported no long-term liabilities at year-end. The filing’s cash-flow statement records $225,000 of convertible-note proceeds and separately reports conversion of $225,000 of note principal into common stock.
No revenue was recorded in either 2020 or 2019, so operating margins are not meaningful. The 2020 loss was 37.8% higher than 2019, while operating expenses rose 43.2%. Cash used in operations increased, and investing activities shifted from cash provided to cash used. Cash at year-end increased by $9,054 from 2019.
Material changes and outlook
- Financing included $275,000 of common-stock proceeds and $225,000 of note proceeds during 2020; the filing also reports issuing shares to convert $225,000 of related-party note principal.
- Common shares issued and outstanding increased from 4,890,424 at December 31, 2019 to 5,780,165 at December 31, 2020. Stock-based compensation was $74,357 in 2020.
- Management expected to fund operations through equity sales and future mineral sales, including from areas it expected to become operational in 2021. It gave no quantified revenue, production, or earnings guidance and offered no assurance of success.
- The auditor issued an unqualified opinion but highlighted substantial doubt about the company’s ability to continue as a going concern, citing significant operating losses. Management likewise identified going-concern uncertainty; the statements include no adjustments for a possible failure to continue.
- COVID-19 had reportedly caused some delays to exploration travel, while the company said its three primary projects continued with minimal disruption. Management reported $50,000 of gross proceeds from warrant exercises and securities issuance in 2021 as of April 30.
Risks, contingencies, and unusual items
- Continued operations depend on raising capital and/or generating operating cash; further equity financing could dilute shareholders. The company has no established revenue stream.
- Brazilian mining permits, environmental regulation, political and economic conditions, taxation, and real-to-dollar exchange-rate volatility may affect project costs and timing.
- The company disclosed no material legal proceedings and no off-balance-sheet arrangements. It reported $10,732 of third-party payables due on demand.
- Brazil Minerals, a significant shareholder and related party, owed Jupiter Gold $190,581 at year-end. The filing also describes a $1,250 monthly service arrangement with Brazil Minerals.
- CEO Marc Fogassa holds the sole Series A preferred share, which carries 51% of total voting power while outstanding. The filing also identifies potential conflicts arising from his leadership roles at both Jupiter Gold and Brazil Minerals.
- The company disclosed no SEC-defined mineral reserves, though it states that Alpha has reserves under Brazilian mining-department guidelines. It reports an Alpha estimate of 84,000 ounces of gold mineralization at a 0.8 g/t cutoff; this is not presented as an SEC reserve estimate.
- Management concluded disclosure controls and internal control over financial reporting were effective and reported no material weaknesses. The board acts as the audit committee and had no independent audit committee financial expert.
Important facts for investors to verify
- Confirm the issuer: the filing identifies Jupiter Gold Corporation, while the request metadata names ATLAS CRITICAL MINERALS Corp.
- Reconcile share-count disclosures: the filing gives different April 23, 2021 outstanding-share figures in different sections, and the year-end balance sheet reports a separate December 31, 2020 count.
- Review the collectability, repayment terms, and any subsequent settlement of the $190,581 related-party receivable from Brazil Minerals.
- Check the status and terms of 2020 note financing and conversion, and any subsequent capital raises, dilution, or warrant exercises.
- Verify the technical basis, independent review, permitting status, and development costs for project estimates and management’s 2021 operational plans. The filing’s project-area figures are not consistent across sections, including for Alpha.
- Confirm the current trading venue and liquidity: the filing describes OTCQB trading in one section, refers to the Pink Open Market elsewhere, and also says the stock is not listed or traded on an exchange or other market.