The Chrysos Process uses high-powered X-rays to bombard rock samples and activate atoms of gold and other metals. A detector can determine their concentrations in minutes. The large test units are about the size of three sea containers placed side by side.
Large samples of up to 500 grams can be graded using the technology without being destroyed as is the case with the traditional process, where samples are sent to a laboratory and heated to 1200 degrees to determine how much gold the samples contain contain. This traditional process takes more than 24 hours.
Chrysos states in the prospectus that as of February 2022 the company had a total contract value of $448 million under its 33 existing contracts for the machines, of which 25 are still in the pipeline.
Chrysos chairman Robert Adamson said there was a solid order book.
“The funds raised by Chrysos in the Offering will be used to support capital expenditures that underpin the Company’s growth ambitions, including the manufacture of additional PhotonAssay units to meet the Company’s sales pipeline, which includes commitments through 2024,” he said.
The company said the strength in gold prices has led to higher demand from gold miners.
“The price of gold has traded higher in recent years. This has resulted in higher margins and has helped expand production in the gold mining sector, supporting demand for analytical services.”
However, the company warns of “various risks related to its supply chain” as it relies heavily on suppliers in China to manufacture its machines. Authorities in China have enforced lockdowns in Shanghai to control the recent wave of COVID-19.
Chrysos will not pay dividends to shareholders upon listing, signaling that it will invest in growth.
The company forecasts revenue of $13.6 million in 2021-22 rising to $26.6 million in 2022-23. It forecast bottom-line losses for both years, with an expected loss of $2.94 million in 2021-22 and $4.74 million in the following year.
Chrysos completed a $50 million fundraiser in early September, valuing the company at about $450 million at the time.
Chrysos does not sell its PhotonAssay units directly to customers, but leases them in a one-stop-shop arrangement for five years with a five-year option that also includes regular service and maintenance. This provides a regular stream of income and ensures that the units are kept in pristine condition.
The company’s name is derived from the Greek word for gold.
Comments are closed.