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NWI
:
TSX
Nuinsco Resources Limited
Building …on a Proven Track Record
Directors
Robert Wardell
,
Chairman
René Galipeau
,
Vice-Chairman
George Archibald
Dr. J.M. Franklin
Ed Guimaraes
Marvin Singer
Officers
René Galipeau
,
CEO
Paul Jones
,
President
Alison Sutcliffe
,
VP Finance
and Chief Financial Officer
Sean Stokes
,
Corporate
Secretary and VP Corporate
Affairs
Dr. David Mchaina
,
VP Environment and Sustainable
Development
Anne Lam
,
Controller
Auditors
BDO Canada LLP
,
Chartered Accountants,
Licensed Public Accountants,
Toronto, Ontario
Legal Counsel
Norton Rose Canada LLP
Toronto, Ontario
Corporate Information
Transfer Agent
&
Registrar
Computershare Trust
Company of Canada,
Toronto, Ontario
Corporate Office
Nuinsco Resources Limited
80
Richmond St. W.,
18
th Floor
Toronto, Ontario
M5H 2A4
Tel: 416.626.0470
Fax: 416.626.0890
Email:
admin@nuinsco.ca
www.nuinsco.ca
Investor Relations
CHF Investor Relations
Tel: 416.868.1079
Fax: 416.868.6198
cathy@chfir.com
Annual General Meeting
The annual meeting
of shareholders will be
held at The Toronto Board
of Trade, 1 First Canadian
Place, Toronto, Ontario,
Friday, June 28th, 2013
at 4:00 p.m. (local time).
Forward-looking Information:
This document contains forward-looking information. All statements, other than statements of historical fact, that address ac-
tivities, events or developments that the Company believes, expects or anticipates will or may occur in the future constitute forward-looking information. This
forward-looking information reflects the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking
information is subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the
forward-looking information, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected
consequences to, or effects on the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other
things: the possibility that actual circumstances will differ from estimates and assumptions; uncertainties relating to the availability and costs of financing needed
in the future; failure to establish estimated mineral resources; fluctuations in commodity prices and currency exchange rates; inflation; recoveries being less than
those indicated by the testwork carried out to date (there can be no assurance that recoveries in small scale laboratory tests will be duplicated in large tests under
on-site conditions or during production); changes in equity markets; operating performance of facilities; environmental and safety risks; delays in obtaining or
failure to obtain necessary permits and approvals from government authorities; unavailability of plant, equipment or labour; inability to retain key management
and personnel; changes to regulations or policies affecting the Company’s activities; the uncertainties involved in interpreting geological data; and the other risks
disclosed under the heading “Risk Factors” and elsewhere in the Company’s annual information form dated March 28, 2013 filed on SEDAR at
www.sedar.com.
Forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims
any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise. Although the
Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future
performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein. All exploration work is supervised by
Paul Jones, President, who acts as QP under National Instrument 43-101.
LETTER TO SHAREHOLDERS
continued from page 1
My view? Exchange Traded Funds (ETFs)
have drained much needed mining investment
out of the market. Cash which would have
traditionally been directed to the mining and
exploration companies that actually produce
value, create employment and provide the basic
materials society needs on a daily basis is now
being parked in gold and silver ETFs, all ETFs
for that matter. This sounds too simple.
It is. So let’s blame the aging population,
of which I am one. What is of first and foremost
importance to those of retirement age? Security.
Not all are fortunate enough to receive the
attractive pensions and benefits available to
some sectors of society. So the speculators
of the past are no longer in the market. They
are not willing to take speculative positions as
they were in the past. They don’t have the time
or desire to wait for that next successful drill
hole. They would rather earn their one percent
interest than take a risk which could return
hundreds of times their investment. Some
even consider lottery tickets a safer investment.
Can you blame them?
Okay. Let’s point our finger at the young
people, a generation of children which has gone
through the most prolific and booming period
in at least my memory. A generation that has
seen the fastest evolution of high-tech products
in history. They have been so fortunate and in
many cases supported by the affluence of their
parents (who likely created at least some of their
wealth from natural resources) that they haven’t
even had time to look at the resource sector,
without which they would not have their high-
tech toys. They understand social networking
but don’t even know that a resource industry
exists or that Canada actually has a resource-
based economy.
Are these the only reasons? Of course not. They
may not even be part of the reasons.
What is certain is that valuations for assets
have deteriorated to the point where assets have
actually become liabilities in the mining sector.
Equity values are so far below the underlying
asset values that it boggles the imagination.
Don’t have assets or you will be penalized. Don’t
have cash because it is not worth very much
unless it is in someone else’s bank account.
What I am getting to is that the low market
valuations of shares and the underlying assets,
especially in junior resource companies, have
made it impossible to finance some of the most
attractive projects in recent history. You know
this, so I am not telling you anything new.
So what do we do? Do we go on vacation
until we see a return of investors to the resource
sector? Do we stop all activity to conserve cash?
Why not? Good news just seems to fall on
deaf ears these days.
I hope you noticed that I have more
questions than answers.
Nuinsco has a team that is keen to
succeed and can’t just lie down. So we look for
alternatives to funding our activities through
today’s virtually non-existent equity markets.
One recent such alternative was the sale
of the Cameron Lake royalty that Nuinsco
retained when the project was sold. This
has strengthened the Company’s balance
sheet sufficiently to allow it to pursue other
alternatives, making it the envy of many of
its cash-starved peers.
Another is the recent transaction whereby
Nuinsco agreed to loan Victory Nickel Inc.
(
TSX:NI) funds to allow the construction of a
frac sand plant in Medicine Hat, Alberta. For
those who don’t appreciate the value of frac
sand, I would suggest you review the results
of three recent IPOs in the frac sand industry
-
US Silica Holdings Inc. (NYSE: SLCA), which
recently instituted a US$0.125 per share
quarterly cash dividend; Hi Crush Partners
LP (NYSE: HCLP), which just declared a cash
distribution for the first quarter of 2013 of
US$0.475 per unit, or US$1.90 on an annualized
basis; and Emerge Energy Services LP that,
in early May, priced its IPO.
This loan agreement with Victory Nickel
could generate up to $10 million of cash in
the very near term for Nuinsco which would
support our exploration activities for some time.
The Company is not changing direction. For over
40
years Nuinsco has been one of the world’s
premier exploration companies and we intend
this to continue. Management and the Board
have merely found an attractive alternative
to the equity markets to fund its exploration
activities that doesn’t dilute shareholders.
Nuinsco is fortunate to have several
highly attractive projects which, with a little
funding, could result in significant share value
appreciation for its patient shareholders even
in this difficult market.
Nuinsco has a strong asset base and
resources, but so do other companies. And the
market is not giving them value either. Nuinsco
has been extraordinarily successful in raising
cash while its peers are struggling. This is due
to the quality of your assets. This doesn’t
represent a change in direction or strategy.
Nuinsco is still an exceptional exploration
company. However, in today’s market, investors
don’t care about exploration. Good news is seen
as a liquidity event. Consequently, capital is not
available at reasonable cost. Therefore, Nuinsco
is being opportunistic in order to create value for
its shareholders. The ultimate goal is to provide
funding to be able to explore existing properties
and look at new ones.
As a reminder, Nuinsco has Diabase, an
advanced uranium project in the Athabasca
Basin of Saskatchewan where recent discoveries
have had significant impact on the share prices
of the companies involved; Prairie Lake, a
significant mineral resource in northwestern
Ontario containing phosphate, niobium, tantalum
and rare metals, not to mention a superb
location close to infrastructure; Berta, one of
the largest porphyry copper/gold projects in
Turkey; and a 50% interest in numerous assets
in Chibougamau, Quebec, one of Canada’s most
prolific mining camps with assets including
eight past producers, a 3,000 ton-per-day
concentrator with tailings facility and a partially-
developed high-grade copper deposit. In
addition, this camp was recently expanded
with the acquisition of two copper projects,
Devlin and Perch River, both of which have
near-term production potential. What is
missing? Investor interest.
In closing, I’d like to thank our directors,
employees, suppliers and partners for their
loyalty and support. Most of all, I give a big vote
of thanks to our shareholders who have believed
in us and continue to be with us during difficult
times. There are better days ahead.
René R. Galipeau
Vice-Chairman and Chief Executive Officer
May 14, 2013
…
capital is not available at
reasonable cost. Therefore,
Nuinsco is being opportunistic
in order to create value for
its shareholders.
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