Homerun Resources launches second phase in strategic growth plan
Recently, Homerun Resources (WKN A3CYRW / TSXV HMR) management provided a comprehensive update on the company’s recent performance, outlining its strategic growth plan. Having already implemented phase one of this plan by securing a prolific source of high purity silica sand in Brazil, the second phase of the strategy is now underway.
Homerun Resources aims to become a leader in energy and industrial materials with its three-phase offering of high-purity silica sand (HPQ Silica). The idea behind this is as simple as it is logical: we live in a society whose technology is built on the use of different, crucial materials – and HPQ Silica is one of those materials.
HPQ Silica – Crucial building block of the technology sector
It is used in numerous industrial and commercial products, making it a component of many solutions in the energy and technology sectors. In mobile devices, HPQ Silica is used to manufacture chips and interactive glass, while the high-purity silica sand is the starting material for the production of polysilicon and solar glass in the manufacture of solar systems.
In other words, without HPQ Silica, there would be no solar power generation and no mobile devices. The negative news for the world, but extremely positive news for Homerun Resources and its shareholders, is that global supplies of HPQ silica are being depleted faster than they are being discovered. It is therefore foreseeable that security of supply for the world’s second most widely used raw material after water will soon become a major issue.
Homerun Resources therefore sees itself not just as a resources company that merely mines the raw material, in this case the silicon, but as a materials company because it processes the silicon oxide into industrial solutions. The company thus covers a much broader value chain than normal raw material companies.
Next stage in the three-phase plan gets underway
Phase one of the strategic plan covers the HPQ silica offering. To successfully execute this part of its strategic direction, Homerun Resources recently secured a significant supply of HPQ silica in Brazil. With global demand on the rise, this move cannot be overstated as it is imperative for any company in this sector to secure stable and reliable sources of HPQ silica.
The second phase of the strategic plan covers infrastructure and logistics. Of course, it would be possible to simply sell HPQ Silica in its natural form. However, if a company wants to gain access to many end uses, the raw sand should be processed, i.e., washed, calibrated and refined, before it is used. As part of the second phase of its strategic plan, Homerun Resources is therefore focusing on integrating infrastructure and logistics for mining, transporting, storing and processing HPQ Silica.
And this is where Homerun is now taking the next step by engaging Encos Consultoria E Construcoes Ltd. of Salvador, Bahia, Brazil. Encos is to assess infrastructure requirements and prepare plans for mining, logistics, transportation, storage and processing infrastructure to the company’s quartz sand operations in Bahia.
Homerun CEO Brian Leeners explained, “We are pleased to initiate phase two of our strategic plan by engaging an experienced local civil engineering firm, and our contractor, Eng. Marcos Manoel A de A Souza, has more than 40 years of project management, development and construction experience in Brazil. We’ve spent a lot of time over the last nine months researching and evaluating infrastructure opportunities for our silica sand operations, and now we have the technical guidance to begin putting those plans directly into action.”
Third phase: Turnover
The third phase of the strategic plan focuses on revenue and vertical integration. Like any company, Homerun Resources strives for stable revenues. Initially, these are to come from the supply of sand in its natural form. If these revenues succeed in building the infrastructure and logistics for processed HPQ silica, higher subsequent revenues can be generated.
Conclusion: Homerun Resources is pursuing ambitious plans, wants to become a leading player in the market for energy and industrial materials. There is still a lot of work ahead for the team around CEO Brian Leeners, but so far, the management is rapidly implementing its plans and has already made great progress. We are definitely staying tuned to this exciting, albeit risky, story.
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