Caught this page in the original Codex: Ultramarines, and it got me wondering - what if all the characters on charge of the company were terminators? Apothecary, company champion, smash captain, ancient (personal banner bearer of the Iron Father - in his dreadnought), a tech marine, and a librarian. I play Iron Hands and go by the old 3rd Edition lore, so no chaplains, and terminator suits are rare, and I’d interpret as used only by the top officers in a company. They were all great fun to kitbash. I know most don’t have rules, but they can proxy as their lighter, power armoured brethren, or as something else (judiciar for the company chap I think!) in the friendly games I play.

5 Scary Ways Employee Internet Monitoring Technology Is Watching You At Work!

Did you know your employer might have read every email or private message you sent on your work computer? Scary thought, isn't it? Why would they do that? Employee internet monitoring—that's the watchful system tracking your online work habits. Ever clicked on a website and then realized hours have slipped by? Employers are keen to cut down on that. Reading this, you'll learn why monitoring is in place, how it benefits you, and what you can do to bypass the 5 most common methods of employee internet monitoring.
https://spacehawkgps.com
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Learn more about GPS car tracking here: https://spacehawkgps.com
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Top 5 Ways How Employers Monitor Internet Activity

Web Content Filtering

Web content filtering functions by employing software or hardware solutions that evaluate and control the websites or content categories an individual can access. For instance, a company might use this tool to block access to social media websites during work hours to ensure employees stay focused and prevent potential security risks associated with these platforms. This approach helps employers enhance employee productivity, maintain network security, and ensure compliance with company policies regarding internet usage.
How to bypass web content filtering. Employees may attempt to bypass web content filtering by using a VPN or accessing blocked content through a proxy server. However, it's crucial to note that these methods may violate company policies and could have consequences.

Firewall & IDS Logs

In your workplace, there are likely tools like firewalls and Intrusion Detection Systems (IDS) that generate logs tracking what happens on the company's network. These logs note things like the data going in and out, IP addresses, and connections. Your employer uses these logs to keep an eye out for unauthorized access, malware, or anything unusual happening online. For example, if you accidentally download something suspicious while at work, these logs record it. This helps your company respond quickly and look into anything that seems out of the ordinary, making sure everything stays secure and compliant with company policies.
How to bypass firewalls & IDS logs. Employees usually cannot directly bypass firewall and IDS logs, as they are backend security measures. However, if employees engage in activities that trigger security alerts, employers may investigate their actions based on the log data.

Keystroke Loggers

Keystroke loggers are surveillance software that track every key you press on your computer. Companies install them to monitor employee activity, ensuring work-related use and securing sensitive data. Imagine typing confidential client information; keystroke loggers record this to prevent data breaches. They also help enforce company policies by flagging non-work-related activities during office hours.
How to bypass keystroke loggers. Use on-screen keyboards or text-to-speech tools as they don't involve physical keystrokes. Additionally, encrypted communication apps can obscure the content of your messages, though this may not prevent loggers from detecting that you've sent a message. Always be aware that attempting to bypass company monitoring tools can violate company policy and have serious repercussions.

Employee Monitoring Software

Employee monitoring software is a tool your company might use to oversee your computer activities during work. Popular brands of employee monitoring software include Time Doctor, VeriClock, and InterGuard. And why might a company use these products? One example is to flag when you send an email containing sensitive company information, ensuring data security and policy compliance.
How to bypass employee monitoring. You could use personal devices during breaks for private communications. However, circumventing these systems can lead to disciplinary action or job loss, so always consider the consequences and adhere to your workplace's guidelines.

Network Traffic Analysis Tools

Network traffic analysis tools examine your internet use, identifying what sites and services you access while on the company network. Companies deploy these tools to spot unusual activity, like accessing high-risk websites, which could introduce security threats. Picture clicking on a streaming service during work hours; these tools alert IT that non-work-related traffic is occurring.
How to bypass network scrutiny. Consider using a virtual private network (VPN), although this may contravene company policies. Alternatively, use your own data plan on personal devices for non-work browsing to stay under the radar.
Related Content: How Companies Track Vehicle Fleets
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7 Ways How To Tell If My Boss Is Spying On My Computer

1. Be aware of alerts and notifications from time tracking and productivity measuring software on your company computer.
2. Surf for common social media applications and see if they are blocked.
3. Check the task manager on your computer to look out for any activity monitoring software that you may not be aware of.
4. Compare the bandwidth allocation and application restrictions on your computer with a colleague’s. If your company computer has more restrictions, chances are you are being monitored by your boss.
5. Indirectly ask the IT department of your office. This is because not all monitoring software leaves a presence in the task Manager. Some employee monitoring software is more advanced, they run in a stealth-mode and cannot simply be opened.
6. Open your computer’s webcam to assess if it's operational without your approval.
7. Read your job contract or your company’s employee handbook. If a clause for employee monitoring is present then surely your boss is keeping a check on your internet usage.

Legal Compliance Tips: Responsible Employee Monitoring for Business Owners

If you're a business owner, you're legally allowed to monitor your employees, provided there's a legitimate business interest. Striking the right balance between managing work processes and respecting employees' privacy is essential. Additionally, employees should be notified before any monitoring takes place. Consent requirements may vary depending on your location.
With the rise of remote work, employee internet usage monitoring software and user activity tracking tools are increasingly popular. These systems help improve productivity and protect against insider threats. While it's true that monitoring can boost network security and prevent data loss, it's important to recognize the potential privacy invasion that comes with it. To maintain trust, encourage employees to keep social media usage limited to personal devices and non-work hours. Here are some things you should consider before monitoring an employees' computer activities:

• Understand local regulations: Research and familiarize yourself with employee monitoring laws in your region to ensure compliance.
• Establish a clear policy: Create a comprehensive, written policy outlining the extent and purpose of monitoring and share it with employees.
• Obtain consent: Obtain employee consent, if required by local laws, before implementing monitoring practices.
• Focus on work-related activities: Limit monitoring to work-related internet usage and activities to minimize privacy invasion.
• Be transparent: Clearly communicate the monitoring practices, tools, and objectives to your employees.
• Avoid excessive surveillance: Steer clear of overly invasive methods, such as keystroke logging or unauthorized webcam access.
• Regularly review your policy: Periodically review and update your monitoring policy to ensure it remains compliant with evolving legal requirements and best practices.
• Respect personal boundaries: Refrain from monitoring employees during non-work hours or on personal devices.
• Prioritize employee trust: Create a supportive work environment that respects privacy while maintaining productivity and security.

Frequently Asked Questions

Is Employee Internet Monitoring legal and necessary for my business?

Yes, Employee Internet Monitoring is generally legal, but laws vary by region, so it's crucial to understand local regulations (ACLU). Monitoring software can help track employees' web activity, bandwidth usage, and application usage, offering insights to improve productivity and maintain platform security. However, it's essential to strike a balance between monitoring and respecting employees' privacy.

How can I effectively monitor employee internet usage without invading privacy?

To monitor employee internet usage responsibly, establish a clear policy and communicate it with your staff. Focus on monitoring work-related online activities and use web filtering or data loss prevention tools to prevent access to inappropriate content or unauthorized file transfers. Be transparent about monitoring practices to maintain trust and avoid overly invasive methods like keystroke logging.

What are some of the best employee monitoring software options?

Popular employee monitoring software includes Time Doctor, ActivTrak, and Teramind. These tools provide a range of features like tracking time spent on tasks, monitoring app usage, and offering workforce management solutions. By comparing features, you can choose a tool that best aligns with your business needs and goals for increased productivity.

Can monitoring software help remote workers stay productive and engaged?

Absolutely! Monitoring remote employees' online activities can help you identify areas for improvement and provide tailored support. Tools like terminal servers or remote desktop solutions facilitate remote workforces, while features such as video recordings and behavior analytics help optimize remote employees' performance. Remember, it's essential to communicate expectations and foster a culture of trust.

How can I use the data from employee monitoring tools to improve my business?

Monitoring tools give insights into employees' time management, app usage, and web browsing habits. Use this data to identify trends, detect insider threats, and allocate resources more efficiently. Implement training programs, set performance benchmarks, and consider offering incentives for increased productivity. Ensure you use the data ethically and transparently to maintain a positive work environment.

Can My Employer See My Internet Activity?

Yes, your employer can use various workplace surveillance software and hardware to record everything you do online. Employee monitoring solutions use sophisticated tracking technologies, like geolocation, keystroke logging, and screenshots, video recording. All this data can be stored via cloud computing and can be run through complex algorithms to anticipate insider threats, measure individual and team productivity, as well as retrace various steps leading to any problems or data leaks.
Related Content: Are Employers Allowed To Track Employee Vehicles?

(The information on the three gold companies in this report is not definitive. Instead, this information will drive you to do more due diligence and make an investment decision.)
A different way to invest in gold is to look for great properties. If you bundle the three companies/properties in this piece, you could own three great properties collectively for under CDN2.00 a share.
​
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GOLDEN RAPTURE MINING (GLDR: CSE) is a collection of premier Ontario mining properties in the Rainy River region that have done enough work to unveil potential, below but left a significant amount of gold with great g/t numbers. As of this morning, some numbers will indeed up its profile. Considering the stock has been listed for about two weeks, these results are excellent. Forgive the length of the table, but given the quality of the results, investors must get the whole picture.
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First, the newest, being listed in the last month, is Golden Rapture Gold. The Company intends to reactivate past mines in the Rainy River area of Ontario. The property is so new that management has only walked about 5% of it, but the numbers are already impressive over its two projects. The Company holds a 100% interest in the high-grade Phillips Township Gold Property, Rainy River District, NW Ontario. The land package totals 225 claim cells for approximately ten thousand acres located close to 4 mineral deposits. These assets include the New Gold Rainy River Mine (+8 million Oz.), the Cameron Lake Deposit (1.8 million Oz.), the Agnico Eagle-Hammond Reef deposit (3.3 million Oz.), the Tartisan Nickel, Copper, and Cobalt Deposit, and many others. Mature local infrastructure, workforce, heavy-duty equipment, hospitals, major highway systems, and local services are nearby.
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Mr. Richard Rivet, CEO of Golden Rapture, commented: “I am incredibly pleased that we have just made some essential and rapid steps toward identifying additional high-grade drill-ready targets. We were pleasantly surprised to discover many high-grade quartz veins on the surface, with the majority of them carrying gold. Unlike many exploration companies, we are not just chasing the typical geophysical anomaly but also many vast high-grade gold structures identified on the surface that can be drilled at any time.
​
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The Company holds a 100% interest in the high-grade Phillips Township Gold Property, Rainy River District, NW Ontario. The land package totals 225 claim cells for approximately ten thousand acres located close to 4 mineral deposits.
These assets include the New Gold Rainy River Mine (+8 million Oz.), the Cameron Lake Deposit (1.8 million Oz.), the Agnico Eagle-Hammond Reef deposit (3.3 million Oz.), the Tartisan Nickel, Copper, and Cobalt Deposit, and many others. Mature local infrastructure, workforce, heavy-duty equipment, hospitals, major highway systems, and local services are nearby.
Ryan Yanch CIM, a director of GLDR, states***, ‘One extremely important fact is that GLDR’s drilling cost is an industry-leading CDN140 a meter. It is not unusual for other gold comp[anbies to spend CDN200-400 or more a meter. One major contributor to this is that one significant cost is the location of the drilling company. 17 km away from the properties significantly lowers the capital cost and allows a more robust drilling program”.***
Given the uniqueness and exceptional quality of GLDR’s properties, there could be excellent investor support. Gold is rallying, and the prospect of further rises may portend in the shadow of interest rate cuts.
Previous work on the properties quickly removes the ubiquitous ‘drill’ on the property or other tropes. These are serious businessmen and women with decades of mining and entrepreneurial experience.
In the world of junior mining IPOs, there is a feeling that the stars must align to profit. Au contraire***. The keys to investing success are the right properties, management, and, in this case, a rallying gold price.***
Numero Deux
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Element79 Gold Corp (the “Company”) (CSE: ELEM) (OTC: ELMGF) is a fascinating gold company and the second in our gold triumvirate located primarily in Peru through its flagship Lucero, Peru, property.
(Full Disclosure: James Tworek, CEO of Element79, is an adviser to the GLDR Board. Your humble scribe owns a small position in each Company.)
The past-producing Lucero Mine (“Lucero”) is one of the highest-grade underground mines in Peru’s history, with grades averaging 19.0g/t Au Equivalent (“Au Eq”) (14.0 g/t gold and 373 g/t silver).
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In its past 5 years of production, ending in 2005, it produced an average of 40,000oz+/yr.
Assays from March 2023 yielded 21-ore-grade and high-yield up to 11.7 ounces per ton of gold and 247 ounces per ton of silver from underground workings, further validating the potential for a significant high-grade future operation.
Consolidating its focus in this region and its impressive geology, ELEM acquired the Roxana Vein and surrounding 1200ha property, Lucero del Sur 28, via auction held on May 17, 2023. The property is located strategically just east of the high-grade Lucero gold-silver project.
Instead of going into much history, let’s look at the Press release ELEM put out on April 23. New assays were released, and CEO James Tworek stated, “The data obtained is not just promising; it’s the cornerstone upon which our future endeavours will be built,” said James Tworek, CEO of Element 79. “These recent results, coupled with historical data, represent the bedrock upon which we are advancing our Lucero project.”
Corporate Presentation.
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From the PR: A total of 97 samples were sent for assays, 56 of which returned greater than 0.1 g/t gold (up to 8.55 g/t gold and 523 g/t silver. Several samples also were rich in base metals (up to 23.7% lead and 9.9% zinc), all of which underscores the richness of our project, further supporting the Company’s belief a robust resource base can be delineated. (Actual assay numbers are shown in the PR)
James C Tworek further states, “Element79 Gold has transformed from an asset amalgamator and seller to a near-term production story, responding to Peru’s government push for formalizing artisanal mining operations. We at Element79 Gold are thrilled to share our unwavering dedication to bringing our Lucero gold project in Peru into production. This past-producing, high-grade gold and silver mine holds immense potential to revitalize our Company and foster economic growth and prosperity in the region. “
The other ELEM property brings us back to North America. Nevada, to be precise. Reason to pay attention?
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Maverick Springs is adjacent to the Carlin Trend. For the uninitiated, the area contains several of the largest gold mines on Earth. The area includes a number of the largest gold mines on Earth. Maverick Springs is a blind deposit comprising a 30-120 metre thick, flat-lying zone centred on an anticlinal structure with oxidation pervasive to 120 metres and intermittent to 270 metres. (5)
West Whistler property is in the same area as Maverick, closer to the Battle Mountain Trend, alongside Carlin: Near several gold deposits, including the Cortez Mine, North America’s third largest gold mine with 2021 gold production of 828,000 ounces.
Finally, the Clover Property, 16 km west of the massive Hecla Mine in the Northern Nevada Rift. The property sits at the top and centre of the Carlin and Battle Mountain Trends.
Nevada Gold’s active Turquoise Ridge Mine, the third largest gold mine in the United States with 537,000 ounces of gold production reported in 2020, as well as the Twin Creeks open pit mines and the dormant Pinson and Getchell mines.
Element 79 has drilling programs announced for the 2023/24 years and a more vigorous program for 2024/25.
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As (GoldSilver.com) an aside, the gold price—and silver—have softened after particularly gold had a decent run. The first two in our group have slid a bit but seem to be holding in nicely.
If one follows gold forecasts, the pundits call for USD 2500-3000 over the next few years. The strategy is simple: A move to USD 3,000 represents a 50% appreciation. However, that also comes with physical and liquidity issues should you want to sell.
And the Gold price?
On December 30, 2022, gold closed the year at $1,819.70 per ounce. Flash forward to one year later, and gold closed 2023 at $2,062.40. That’s a gain of 13.3% in a single year.
With gold pushing to new record highs, it’s a fascinating time for gold investors.
Predicting the future of gold prices is never easy, but to offer some insights into what 2024 might hold, we’ve (compiled an array of gold price forecasts, outlooks, and predictions from renowned banks, industry experts, and financial analysts.
Let’s take a look.
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Numero Three
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Off we go to South America. This time, Columbia with SOMA Gold. (TSXV: SOMA) (WKN: A2P4DU) (OTC: SMAGF) (the “Company” or “Soma“) recently announced that gold production for Q1 2024 was 7,335 AuEq ounces, an increase of 8% over the same period in 2023.
Let’s not get ahead of ourselves.
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The Company owns two adjacent mining properties in Antioquia, Colombia, with a combined milling capacity of 675 tpd. (Permitted for 1,400 tpd). The El Bagre Mill is currently operating and producing. Internally generated funds are being used to finance a regional exploration program.
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Soma is further ahead than our previous companies, which doesn’t make it better; it is just a different stage of development.
Corporate Presentation, 2023 results, Tech Report.
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Properties
Cardero Mine

• The 84 thousand tonnes (kt) production rate in 2022 will ramp up to a peak mining production rate of 248 kt (680 tpd) in 2024. Achieving the planned peak production rate of 248 kt per annum would allow the Company to restart its previously operating El Limon Mill, with feed from Cordero in late 2023.
• El Bagre Gold Mining Complex is located approximately 167 km northeast of Medellín in the Department of Antioquia, Colombia. Soma produced 23,115 ounces of gold at its El Bagre Mill in 2022, an increase of 30% from the previous year. Soma’s production forecast for 2023 is for a further 50% increase to 35,500 ounces of gold produced.
• In addition to its operating El Bagre Mill, Soma owns the 225 tpd Limon Mill, which is located 47 km south of the El Bagre Mill. The Limon Mill has been on care and maintenance since 2020 but will be restarted when production from the Cordero Mine exceeds the capacity of the El Bagre Mill.
• The Limon Mill operates similarly to the El Bagre Mill with two-stage crushing, ball milling, gravity concentration, flotation, cyanidation, Merrill Crowe precipitation, and smelting to produce doré. The mill was upgraded in 2017 to a capacity of 225 tpd and is permitted for up to 400 tpd.

As mentioned, these three companies are similar in that they have what appear to be skookum properties. They are also all great gold proxies, and they all trade for under CDN1.00. Cheekily, I may have said that investors can own all three companies for under CDN 2.00 a share.
While I like the companies, I would buy them for their land positions. All have land that isn’t some dust pit but has either historical or proven assays. And most are near large producers. Element79; Nevada.Carlin Trend? Seriously?

(The information on the three gold companies in this report is not definitive. Instead, this information will drive you to do more due diligence and make an investment decision.)
A different way to invest in gold is to look for great properties. If you bundle the three companies/properties in this piece, you could own three great properties collectively for under CDN2.00 a share.
​
https://preview.redd.it/cgt5klglve0d1.jpg?width=1500&format=pjpg&auto=webp&s=52842f9f467b7322933cbadfb409131fa5280c92
GOLDEN RAPTURE MINING (GLDR: CSE) is a collection of premier Ontario mining properties in the Rainy River region that have done enough work to unveil potential, below but left a significant amount of gold with great g/t numbers. As of this morning, some numbers will indeed up its profile. Considering the stock has been listed for about two weeks, these results are excellent. Forgive the length of the table, but given the quality of the results, investors must get the whole picture.
​
https://preview.redd.it/8pqqojpmve0d1.png?width=833&format=png&auto=webp&s=a0907cc108e697b01f756eb25732f54275970919
First, the newest, being listed in the last month, is Golden Rapture Gold. The Company intends to reactivate past mines in the Rainy River area of Ontario. The property is so new that management has only walked about 5% of it, but the numbers are already impressive over its two projects. The Company holds a 100% interest in the high-grade Phillips Township Gold Property, Rainy River District, NW Ontario. The land package totals 225 claim cells for approximately ten thousand acres located close to 4 mineral deposits. These assets include the New Gold Rainy River Mine (+8 million Oz.), the Cameron Lake Deposit (1.8 million Oz.), the Agnico Eagle-Hammond Reef deposit (3.3 million Oz.), the Tartisan Nickel, Copper, and Cobalt Deposit, and many others. Mature local infrastructure, workforce, heavy-duty equipment, hospitals, major highway systems, and local services are nearby.
​
https://preview.redd.it/pj497rxnve0d1.png?width=1135&format=png&auto=webp&s=4c5373242bd3d538dc35fef24afa3b12c327dbf3
Mr. Richard Rivet, CEO of Golden Rapture, commented: “I am incredibly pleased that we have just made some essential and rapid steps toward identifying additional high-grade drill-ready targets. We were pleasantly surprised to discover many high-grade quartz veins on the surface, with the majority of them carrying gold. Unlike many exploration companies, we are not just chasing the typical geophysical anomaly but also many vast high-grade gold structures identified on the surface that can be drilled at any time.
​
https://preview.redd.it/ygqol0dcze0d1.jpg?width=1804&format=pjpg&auto=webp&s=f800bcec5fa27d58b9cdbb2dd3a0025bad5181fd
https://preview.redd.it/ofra51dcze0d1.jpg?width=1732&format=pjpg&auto=webp&s=e7c11706fa08a152cec2cc63e66e898beb504878
The Company holds a 100% interest in the high-grade Phillips Township Gold Property, Rainy River District, NW Ontario. The land package totals 225 claim cells for approximately ten thousand acres located close to 4 mineral deposits.
These assets include the New Gold Rainy River Mine (+8 million Oz.), the Cameron Lake Deposit (1.8 million Oz.), the Agnico Eagle-Hammond Reef deposit (3.3 million Oz.), the Tartisan Nickel, Copper, and Cobalt Deposit, and many others. Mature local infrastructure, workforce, heavy-duty equipment, hospitals, major highway systems, and local services are nearby.
Ryan Yanch CIM, a director of GLDR, states***, ‘One extremely important fact is that GLDR’s drilling cost is an industry-leading CDN140 a meter. It is not unusual for other gold comp[anbies to spend CDN200-400 or more a meter. One major contributor to this is that one significant cost is the location of the drilling company. 17 km away from the properties significantly lowers the capital cost and allows a more robust drilling program”.***
Given the uniqueness and exceptional quality of GLDR’s properties, there could be excellent investor support. Gold is rallying, and the prospect of further rises may portend in the shadow of interest rate cuts.
Previous work on the properties quickly removes the ubiquitous ‘drill’ on the property or other tropes. These are serious businessmen and women with decades of mining and entrepreneurial experience.
In the world of junior mining IPOs, there is a feeling that the stars must align to profit. Au contraire***. The keys to investing success are the right properties, management, and, in this case, a rallying gold price.***
Numero Deux
​
https://preview.redd.it/z6dnzpqgze0d1.png?width=461&format=png&auto=webp&s=bc2c2ded02e54a1233e353aecd3093261f5f0f32
Element79 Gold Corp (the “Company”) (CSE: ELEM) (OTC: ELMGF) is a fascinating gold company and the second in our gold triumvirate located primarily in Peru through its flagship Lucero, Peru, property.
(Full Disclosure: James Tworek, CEO of Element79, is an adviser to the GLDR Board. Your humble scribe owns a small position in each Company.)
The past-producing Lucero Mine (“Lucero”) is one of the highest-grade underground mines in Peru’s history, with grades averaging 19.0g/t Au Equivalent (“Au Eq”) (14.0 g/t gold and 373 g/t silver).
​
https://preview.redd.it/wb41yivjze0d1.png?width=557&format=png&auto=webp&s=2d73bfada69e683e421ee2c9ca3157a1dd449dea
In its past 5 years of production, ending in 2005, it produced an average of 40,000oz+/yr.
Assays from March 2023 yielded 21-ore-grade and high-yield up to 11.7 ounces per ton of gold and 247 ounces per ton of silver from underground workings, further validating the potential for a significant high-grade future operation.
Consolidating its focus in this region and its impressive geology, ELEM acquired the Roxana Vein and surrounding 1200ha property, Lucero del Sur 28, via auction held on May 17, 2023. The property is located strategically just east of the high-grade Lucero gold-silver project.
Instead of going into much history, let’s look at the Press release ELEM put out on April 23. New assays were released, and CEO James Tworek stated, “The data obtained is not just promising; it’s the cornerstone upon which our future endeavours will be built,” said James Tworek, CEO of Element 79. “These recent results, coupled with historical data, represent the bedrock upon which we are advancing our Lucero project.”
Corporate Presentation.
​
https://preview.redd.it/1fie5r3lze0d1.jpg?width=800&format=pjpg&auto=webp&s=d4d9d6866fa8604a4c9a7f5222b9f9cf78a8477a
From the PR: A total of 97 samples were sent for assays, 56 of which returned greater than 0.1 g/t gold (up to 8.55 g/t gold and 523 g/t silver. Several samples also were rich in base metals (up to 23.7% lead and 9.9% zinc), all of which underscores the richness of our project, further supporting the Company’s belief a robust resource base can be delineated. (Actual assay numbers are shown in the PR)
James C Tworek further states, “Element79 Gold has transformed from an asset amalgamator and seller to a near-term production story, responding to Peru’s government push for formalizing artisanal mining operations. We at Element79 Gold are thrilled to share our unwavering dedication to bringing our Lucero gold project in Peru into production. This past-producing, high-grade gold and silver mine holds immense potential to revitalize our Company and foster economic growth and prosperity in the region. “
The other ELEM property brings us back to North America. Nevada, to be precise. Reason to pay attention?
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Maverick Springs is adjacent to the Carlin Trend. For the uninitiated, the area contains several of the largest gold mines on Earth. The area includes a number of the largest gold mines on Earth. Maverick Springs is a blind deposit comprising a 30-120 metre thick, flat-lying zone centred on an anticlinal structure with oxidation pervasive to 120 metres and intermittent to 270 metres. (5)
West Whistler property is in the same area as Maverick, closer to the Battle Mountain Trend, alongside Carlin: Near several gold deposits, including the Cortez Mine, North America’s third largest gold mine with 2021 gold production of 828,000 ounces.
Finally, the Clover Property, 16 km west of the massive Hecla Mine in the Northern Nevada Rift. The property sits at the top and centre of the Carlin and Battle Mountain Trends.
Nevada Gold’s active Turquoise Ridge Mine, the third largest gold mine in the United States with 537,000 ounces of gold production reported in 2020, as well as the Twin Creeks open pit mines and the dormant Pinson and Getchell mines.
Element 79 has drilling programs announced for the 2023/24 years and a more vigorous program for 2024/25.
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As (GoldSilver.com) an aside, the gold price—and silver—have softened after particularly gold had a decent run. The first two in our group have slid a bit but seem to be holding in nicely.
If one follows gold forecasts, the pundits call for USD 2500-3000 over the next few years. The strategy is simple: A move to USD 3,000 represents a 50% appreciation. However, that also comes with physical and liquidity issues should you want to sell.
And the Gold price?
On December 30, 2022, gold closed the year at $1,819.70 per ounce. Flash forward to one year later, and gold closed 2023 at $2,062.40. That’s a gain of 13.3% in a single year.
With gold pushing to new record highs, it’s a fascinating time for gold investors.
Predicting the future of gold prices is never easy, but to offer some insights into what 2024 might hold, we’ve (compiled an array of gold price forecasts, outlooks, and predictions from renowned banks, industry experts, and financial analysts.
Let’s take a look.
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Numero Three
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Off we go to South America. This time, Columbia with SOMA Gold. (TSXV: SOMA) (WKN: A2P4DU) (OTC: SMAGF) (the “Company” or “Soma“) recently announced that gold production for Q1 2024 was 7,335 AuEq ounces, an increase of 8% over the same period in 2023.
Let’s not get ahead of ourselves.
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The Company owns two adjacent mining properties in Antioquia, Colombia, with a combined milling capacity of 675 tpd. (Permitted for 1,400 tpd). The El Bagre Mill is currently operating and producing. Internally generated funds are being used to finance a regional exploration program.
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Soma is further ahead than our previous companies, which doesn’t make it better; it is just a different stage of development.
Corporate Presentation, 2023 results, Tech Report.
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https://preview.redd.it/9kd65uwsze0d1.png?width=729&format=png&auto=webp&s=d148888b24ecb81b6032443eead0d78f569daced
Properties
Cardero Mine

• The 84 thousand tonnes (kt) production rate in 2022 will ramp up to a peak mining production rate of 248 kt (680 tpd) in 2024. Achieving the planned peak production rate of 248 kt per annum would allow the Company to restart its previously operating El Limon Mill, with feed from Cordero in late 2023.
• El Bagre Gold Mining Complex is located approximately 167 km northeast of Medellín in the Department of Antioquia, Colombia. Soma produced 23,115 ounces of gold at its El Bagre Mill in 2022, an increase of 30% from the previous year. Soma’s production forecast for 2023 is for a further 50% increase to 35,500 ounces of gold produced.
• In addition to its operating El Bagre Mill, Soma owns the 225 tpd Limon Mill, which is located 47 km south of the El Bagre Mill. The Limon Mill has been on care and maintenance since 2020 but will be restarted when production from the Cordero Mine exceeds the capacity of the El Bagre Mill.
• The Limon Mill operates similarly to the El Bagre Mill with two-stage crushing, ball milling, gravity concentration, flotation, cyanidation, Merrill Crowe precipitation, and smelting to produce doré. The mill was upgraded in 2017 to a capacity of 225 tpd and is permitted for up to 400 tpd.

As mentioned, these three companies are similar in that they have what appear to be skookum properties. They are also all great gold proxies, and they all trade for under CDN1.00. Cheekily, I may have said that investors can own all three companies for under CDN 2.00 a share.
While I like the companies, I would buy them for their land positions. All have land that isn’t some dust pit but has either historical or proven assays. And most are near large producers. Element79; Nevada.Carlin Trend? Seriously?

(The information on the three gold companies in this report is not definitive. Instead, this information will drive you to do more due diligence and make an investment decision.)
A different way to invest in gold is to look for great properties. If you bundle the three companies/properties in this piece, you could own three great properties collectively for under CDN2.00 a share.
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GOLDEN RAPTURE MINING (GLDR: CSE) is a collection of premier Ontario mining properties in the Rainy River region that have done enough work to unveil potential, below but left a significant amount of gold with great g/t numbers. As of this morning, some numbers will indeed up its profile. Considering the stock has been listed for about two weeks, these results are excellent. Forgive the length of the table, but given the quality of the results, investors must get the whole picture.
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First, the newest, being listed in the last month, is Golden Rapture Gold. The Company intends to reactivate past mines in the Rainy River area of Ontario. The property is so new that management has only walked about 5% of it, but the numbers are already impressive over its two projects. The Company holds a 100% interest in the high-grade Phillips Township Gold Property, Rainy River District, NW Ontario. The land package totals 225 claim cells for approximately ten thousand acres located close to 4 mineral deposits. These assets include the New Gold Rainy River Mine (+8 million Oz.), the Cameron Lake Deposit (1.8 million Oz.), the Agnico Eagle-Hammond Reef deposit (3.3 million Oz.), the Tartisan Nickel, Copper, and Cobalt Deposit, and many others. Mature local infrastructure, workforce, heavy-duty equipment, hospitals, major highway systems, and local services are nearby.
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Mr. Richard Rivet, CEO of Golden Rapture, commented: “I am incredibly pleased that we have just made some essential and rapid steps toward identifying additional high-grade drill-ready targets. We were pleasantly surprised to discover many high-grade quartz veins on the surface, with the majority of them carrying gold. Unlike many exploration companies, we are not just chasing the typical geophysical anomaly but also many vast high-grade gold structures identified on the surface that can be drilled at any time.
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The Company holds a 100% interest in the high-grade Phillips Township Gold Property, Rainy River District, NW Ontario. The land package totals 225 claim cells for approximately ten thousand acres located close to 4 mineral deposits.
These assets include the New Gold Rainy River Mine (+8 million Oz.), the Cameron Lake Deposit (1.8 million Oz.), the Agnico Eagle-Hammond Reef deposit (3.3 million Oz.), the Tartisan Nickel, Copper, and Cobalt Deposit, and many others. Mature local infrastructure, workforce, heavy-duty equipment, hospitals, major highway systems, and local services are nearby.
Ryan Yanch CIM, a director of GLDR, states***, ‘One extremely important fact is that GLDR’s drilling cost is an industry-leading CDN140 a meter. It is not unusual for other gold comp[anbies to spend CDN200-400 or more a meter. One major contributor to this is that one significant cost is the location of the drilling company. 17 km away from the properties significantly lowers the capital cost and allows a more robust drilling program”.***
Given the uniqueness and exceptional quality of GLDR’s properties, there could be excellent investor support. Gold is rallying, and the prospect of further rises may portend in the shadow of interest rate cuts.
Previous work on the properties quickly removes the ubiquitous ‘drill’ on the property or other tropes. These are serious businessmen and women with decades of mining and entrepreneurial experience.
In the world of junior mining IPOs, there is a feeling that the stars must align to profit. Au contraire***. The keys to investing success are the right properties, management, and, in this case, a rallying gold price.***
Numero Deux
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Element79 Gold Corp (the “Company”) (CSE: ELEM) (OTC: ELMGF) is a fascinating gold company and the second in our gold triumvirate located primarily in Peru through its flagship Lucero, Peru, property.
(Full Disclosure: James Tworek, CEO of Element79, is an adviser to the GLDR Board. Your humble scribe owns a small position in each Company.)
The past-producing Lucero Mine (“Lucero”) is one of the highest-grade underground mines in Peru’s history, with grades averaging 19.0g/t Au Equivalent (“Au Eq”) (14.0 g/t gold and 373 g/t silver).
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In its past 5 years of production, ending in 2005, it produced an average of 40,000oz+/yr.
Assays from March 2023 yielded 21-ore-grade and high-yield up to 11.7 ounces per ton of gold and 247 ounces per ton of silver from underground workings, further validating the potential for a significant high-grade future operation.
Consolidating its focus in this region and its impressive geology, ELEM acquired the Roxana Vein and surrounding 1200ha property, Lucero del Sur 28, via auction held on May 17, 2023. The property is located strategically just east of the high-grade Lucero gold-silver project.
Instead of going into much history, let’s look at the Press release ELEM put out on April 23. New assays were released, and CEO James Tworek stated, “The data obtained is not just promising; it’s the cornerstone upon which our future endeavours will be built,” said James Tworek, CEO of Element 79. “These recent results, coupled with historical data, represent the bedrock upon which we are advancing our Lucero project.”
Corporate Presentation.
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From the PR: A total of 97 samples were sent for assays, 56 of which returned greater than 0.1 g/t gold (up to 8.55 g/t gold and 523 g/t silver. Several samples also were rich in base metals (up to 23.7% lead and 9.9% zinc), all of which underscores the richness of our project, further supporting the Company’s belief a robust resource base can be delineated. (Actual assay numbers are shown in the PR)
James C Tworek further states, “Element79 Gold has transformed from an asset amalgamator and seller to a near-term production story, responding to Peru’s government push for formalizing artisanal mining operations. We at Element79 Gold are thrilled to share our unwavering dedication to bringing our Lucero gold project in Peru into production. This past-producing, high-grade gold and silver mine holds immense potential to revitalize our Company and foster economic growth and prosperity in the region. “
The other ELEM property brings us back to North America. Nevada, to be precise. Reason to pay attention?
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Maverick Springs is adjacent to the Carlin Trend. For the uninitiated, the area contains several of the largest gold mines on Earth. The area includes a number of the largest gold mines on Earth. Maverick Springs is a blind deposit comprising a 30-120 metre thick, flat-lying zone centred on an anticlinal structure with oxidation pervasive to 120 metres and intermittent to 270 metres. (5)
West Whistler property is in the same area as Maverick, closer to the Battle Mountain Trend, alongside Carlin: Near several gold deposits, including the Cortez Mine, North America’s third largest gold mine with 2021 gold production of 828,000 ounces.
Finally, the Clover Property, 16 km west of the massive Hecla Mine in the Northern Nevada Rift. The property sits at the top and centre of the Carlin and Battle Mountain Trends.
Nevada Gold’s active Turquoise Ridge Mine, the third largest gold mine in the United States with 537,000 ounces of gold production reported in 2020, as well as the Twin Creeks open pit mines and the dormant Pinson and Getchell mines.
Element 79 has drilling programs announced for the 2023/24 years and a more vigorous program for 2024/25.
​
https://preview.redd.it/c30916h6ve0d1.png?width=943&format=png&auto=webp&s=06c02fc942928e97ddaa5a38c0725175e5573ac7
As (GoldSilver.com) an aside, the gold price—and silver—have softened after particularly gold had a decent run. The first two in our group have slid a bit but seem to be holding in nicely.
If one follows gold forecasts, the pundits call for USD 2500-3000 over the next few years. The strategy is simple: A move to USD 3,000 represents a 50% appreciation. However, that also comes with physical and liquidity issues should you want to sell.
And the Gold price?
On December 30, 2022, gold closed the year at $1,819.70 per ounce. Flash forward to one year later, and gold closed 2023 at $2,062.40. That’s a gain of 13.3% in a single year.
With gold pushing to new record highs, it’s a fascinating time for gold investors.
Predicting the future of gold prices is never easy, but to offer some insights into what 2024 might hold, we’ve (compiled an array of gold price forecasts, outlooks, and predictions from renowned banks, industry experts, and financial analysts.
Let’s take a look.
​
https://preview.redd.it/2o1f4i67ve0d1.png?width=1385&format=png&auto=webp&s=973e0778e971a7ab93672aa3ac10c4b11ea6a7b3
Numero Three
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Off we go to South America. This time, Columbia with SOMA Gold. (TSXV: SOMA) (WKN: A2P4DU) (OTC: SMAGF) (the “Company” or “Soma“) recently announced that gold production for Q1 2024 was 7,335 AuEq ounces, an increase of 8% over the same period in 2023.
Let’s not get ahead of ourselves.
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https://preview.redd.it/9soyq36fve0d1.png?width=625&format=png&auto=webp&s=00d351e23310ea8e9d2b607b5a012c302687f038
The Company owns two adjacent mining properties in Antioquia, Colombia, with a combined milling capacity of 675 tpd. (Permitted for 1,400 tpd). The El Bagre Mill is currently operating and producing. Internally generated funds are being used to finance a regional exploration program.
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https://preview.redd.it/55x97d2gve0d1.png?width=872&format=png&auto=webp&s=fa38819b9e52fd10910434894d64e823f2447798
Soma is further ahead than our previous companies, which doesn’t make it better; it is just a different stage of development.
Corporate Presentation, 2023 results, Tech Report.
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Properties
Cardero Mine

• The 84 thousand tonnes (kt) production rate in 2022 will ramp up to a peak mining production rate of 248 kt (680 tpd) in 2024. Achieving the planned peak production rate of 248 kt per annum would allow the Company to restart its previously operating El Limon Mill, with feed from Cordero in late 2023.
• El Bagre Gold Mining Complex is located approximately 167 km northeast of Medellín in the Department of Antioquia, Colombia. Soma produced 23,115 ounces of gold at its El Bagre Mill in 2022, an increase of 30% from the previous year. Soma’s production forecast for 2023 is for a further 50% increase to 35,500 ounces of gold produced.
• In addition to its operating El Bagre Mill, Soma owns the 225 tpd Limon Mill, which is located 47 km south of the El Bagre Mill. The Limon Mill has been on care and maintenance since 2020 but will be restarted when production from the Cordero Mine exceeds the capacity of the El Bagre Mill.
• The Limon Mill operates similarly to the El Bagre Mill with two-stage crushing, ball milling, gravity concentration, flotation, cyanidation, Merrill Crowe precipitation, and smelting to produce doré. The mill was upgraded in 2017 to a capacity of 225 tpd and is permitted for up to 400 tpd.

As mentioned, these three companies are similar in that they have what appear to be skookum properties. They are also all great gold proxies, and they all trade for under CDN1.00. Cheekily, I may have said that investors can own all three companies for under CDN 2.00 a share.
While I like the companies, I would buy them for their land positions. All have land that isn’t some dust pit but has either historical or proven assays. And most are near large producers. Element79; Nevada.Carlin Trend? Seriously?

Top: Mononoke, Casshern sins, Arakawa Under the bridge Middle: Ergo proxy, Kill la kill, Wolf’s rain Bottom: House of five leaves, Fate stay night heaven’s feel, Chainsaw man

The kitchen is on fire. Welcome to the final part of the Vapiano story where the tables are turning. In the first two episodes we followed Mark Korzilius' journey from setbacks to founding Vapiano, a groundbreaking restaurant concept, highlighting its fresh ingredients, dynamic atmosphere, and data-driven operations that drove rapid success. While achieving initial profitability and garnering attention from industry giants like McDonald's, Vapiano's global expansion has led to stellar revenue growth. However, it has also resulted in the emergence of numerous side projects (or distractions), operational challenges, increased costs, significant investments, and a notable accumulation of debt. This underscores the prioritization of top-line growth over profitable growth. We will continue on this thread and see how the story ends, but I would encourage you to read part one and two for better context. Vapiano P1: Italian Food Made in Germany (substack.com). Let's dig in.
Before Going Public
We are now in 2015 and the year is a disaster for Vapiano's PR department. Employee time stamps are being manipulated, endless overtime for employees and high turnover in managerial roles are reported; mice in the kitchen and even rotten food allegedly found.
The company is confronted with allegations of exceeding working hours among trainees in an article published by Welt am Sonntag, while the same outlet accuses Vapiano of manipulating punch times. The auditing firm PwC is commissioned to investigate the allegations and finds that there is no systematic approach but rather misconduct by individual employees, a mistake that’s being corrected. Internal however, investigations into stamp times are carried out regularly now and beyond its obvious reputational impact, this sucks up valuable management time and attention.
In the summer of 2015 CEO, co-founder and investor Gregor Gerlach, who has been running the group since 2011 is stepping down and Jochen Halfmann is taking over. A new Vapiano People Program with an App is being developed with the aim to better interact with customers that will incorporate innovate features such as mobile pay. The German website sees a launch of new magazine to further promote the brand and there is now a full inhouse blogger and Instagram team being installed. In October the company buys seven restaurants from original co-founder, former co-investor and ex-president previously responsible for internation expansion Kent Hahne (2x Bonn, 3x Cologne, 1x Koblenz and one in Cologne that’s under construction). This package of Vapiano restaurants is very successful and generates net sales of more than 20 million euros in 2014. Hahne opened his first Vapiano restaurant in Cologne in August 2006 and in 2015 with his company apeiron AG, Hahne operates six L'Osteria franchise restaurants, a direct Vapiano competitor, and two self-owned restaurants GinYuu.
Then in November of 2015, the next public relations bomb goes off with allegations regarding the company's quality standards. The company immediately investigates the issue through internal and external specialists but finds no evidence of any quality issues. Nevertheless, knowing that the group is now being closely watched, the company’s already in place hygiene standards are being reinforced. Additional audits and inspections are performed nationally. Further, all Vapianos worldwide are being audited twice by the partners SGS Institut Fresenius and SAI Global. Auditing software is purchased to simplify the implementation of the audits and the resulting measures. Apart from the external examinations, there is a food sampling plan in place being performed continuously. Again, all of this sucks up costs, management time and attention. With all these tumultuous developments the company’s growth engine is undeterred. Revenue grows by a whopping 50 million euros to 202 million euros, an increase of 33%. Impressive. While average spent per customer increases in all countries, the number of customers per day in Germany decreases by 3.3% partially due to the negative press towards the end of the year. Five own, four JV and 19 new franchise restaurants are added that year to the group, the total number of own managed restaurants grows to 51, there are 31 JVs and 84 franchises which bringing the total to 166 Vapiano restaurants. Global restaurant sales are now above 400 million euros.
But while revenue grows by an astronomical 50 million euros, operating profits, alarmingly, shrink again. Gross margins are staying perfectly healthy above 75% but operating costs keep growing disproportionately fast. The Company’s outstanding debt jumps by almost 30 million, close to 85 million euros by the end of the year. With operating profits at 9.5 million euros, alarm bells should be going off right now.
In Q4 of 2015, new CEO Jochen Halfmann introduces Strategy 2020. The new strategy includes five essential points. One, profitable growth in the newly defined core markets of Germany and Austria as well as in the UK, Netherlands, France and USA. Two, operational excellence through strict “best practice” management. Three, further development and digitalization of the concept considering guest feedback. Four, greater focus on long-term employee retention and five, building a modern and sustainable IT landscape. Sound’s good on paper but let’s see how things pan out.
Vapiano's investments (capital expenditures) that year are primarily directed towards new restaurant openings, renovations of existing establishments, and share acquisitions in other Vapiano restaurants from franchisees or JV partners. A significant portion of funds is allocated to the digitalization of the guest experience, including the development of a new app scheduled for market release in 2016 and the implementation of a time recording system across all group restaurants. The world's first standalone Vapiano restaurant with a delivery service that year is built in Fürth, Germany. The company keeps expanding its presence in both inner-city locations and international markets, such as Shanghai, China.
To finance all of this, the group has its own operating cash flow which comes in at 18 million while capital expenditures are 26 million euros plus 14 million for acquisitions. The funding gab is filled with 26 million euros of new debt and a seven-million-euro equity raise. At that end of the year and after the equity raise Gregor Gerlach (through his AP Leipzig GmbH & Co. KG entity) holds 30.1%, Hans-Joachim and Gisa Sander through their Exchange Bio GmbH hold 25.5% and the Tchibo heirs, Herz through their Mayfair Beteiligungsfonds II GmbH & Co. KG hold 44,4%.
But for the first time the restaurant’s concept that was so successful to date is being questioned. Some customers are starting to mislike the operational flow of the concept itself. If you want pasta, you must queue for pasta. If you want pizza you stand in a different queue. A small side salad, yet another queue. "You spend more time carrying trays than an actress in Berlin-Mitte. The audience in the pasta limbo can only consist of people who have worked for an insurance company for a long time and, like Stockholm syndrome, they can no longer get away from the industrial canteen feeling," writes TV host Beisenherz provocatively. While overly harsh in his assessment he's not entirely wrong judging by customers venting their frustrations in forums and social media channels. It isn’t uncommon for those who ordered pizza to have already finished eating while there is little movement in the pasta queue. Long term that doesn't go down well, QSRs competitors like L’Osteria are handling this process differently, with much success.
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Tipping Point

Where are now in the year 2016 and things start to deteriorate visibility. Perhaps not for the leman’s eye but any business minded observer can see that there are problems under the hood. Yes, revenue grows yet another whopping 50 million to almost 250 million euros but half of that growth, comes from acquisitions of restaurants that the group didn’t already own 100%, which is now being fully consolidated within the group’s accounts. Here is a concrete example. In the past, Vapiano SE, the group’s top holding company held an indirect 50% stake in a French subgroup via the subsidiary VAP Restaurants SA, based in Luxembourg, and included this as an associated company in the Vapiano SE consolidated financial statements using the equity method. Due to the acquisition of additional shares in September of 2016, Vapiano SE's indirect share in the French subgroup increased to 75%. This means that Vapiano SE takes control of the French subgroup, which is therefore included in the group’s financial statements as part of the full consolidation. The revenue from the acquired subsidiary now recorded in the consolidated income statement amounts to 12.8 million euros. While that’s great for the top line, the loss of the fully consolidated entity equates to 0.2 million euros. Yes, you are buying revenue, but there are losses attached to them, not profits. A similar case is the Swedish entity that runs eight restaurants with revenue of 11.5 million euros but has losses of 235 thousand euros. So much for Strategy 2020 and “profitable” growth.
That year the group’s operating profits are absolutely tanking, halving to 3.5 million euros. Operating profits are now a mere 1,4% of revenue. Remember original founder Mark Korzilius who talked about operating margins of 25% to 28% at the restaurant level? Yes, there are overhead costs for the organization that sits above the chain of restaurants, but operating margins that low indicates a course correction is needed. What’s telling is that in the annual report, in the management discussion section, the company starts talking about EBITDA as a proxy measure of profitability, rather than operating profit or net income. This wasn’t the case in the years before. Is this window dressing for an upcoming IPO? EBITDA is short for earnings before interest, tax, depreciation, and amortization. How can you measure profitability of a restaurant chain that absolutely and unequivocally needs capital investment to maintain its restaurant operations, the very source of cash generation, by simply excluding this maintenance charge (depreciation in the income statement)? Vapiano’s own annual report talks about the fact that existing restaurants must be rejuvenated from time to time and that new interior designs have to be implemented every few years. These things wear and tear, they go out of style, kitchen equipment breaks and needs replacement. This business absolutely needs maintenance capital expenditure, why anyone talks of profits before these maintenance costs is beyond me. Fun fact: in the previous annual report EBITDA is mentioned seven times, mostly around restaurant acquisitions and financing, not however as a profit indication for the group. In the new annual report, EBITDA is mentioned 28 times. Maybe it’s just me but belated Charlie Munger liked to call EBITDA: bullsh*t earnings. When in doubt I stick with Charlie. Interestingly, EBITDA for Vapiano keeps growing while operating and net profits keep falling.
Operating cashflow for the group that year is about 21 million euros, but capital expenditure is 30 million and acquisitions for subsidiaries another 20 million. To finance these expenditures another 28 million euros of debt and 16 million of equity is raised. Net debt rises above 130 million euro. The operating cashflow of the group before any capital expenditures is 21 million euros. I am not sure free cash flow would be significantly positive after maintenance capex is paid out; it’s not broken out so we can’t be sure. Granted, I am not on the ground during this time, and I am not in the board room, I am simply reading what’s in front of me, but to me this is starting to look like a distressed situation. Regardless, the following year the company goes public.

IPO

Where are now in the year 2017 and its Vapiano’s first year as public company. The company’s annual report reads the following “Sales revenue, like-for-like growth (LfL) and the earnings figures EBITDA and adjusted EBITDA are used as the most important financial performance indicators for controlling operational business activities.” The very same report however also says: “The majority of the group's investments regularly go towards opening new restaurant locations and modernizing existing restaurants. The latter are differentiated into regular replacement investments that occur during ongoing operations (Maintenance CAPEX) and fundamental investments in the renovation of a restaurant (Remodeling CAPEX). On average, a restaurant remodeling takes place nine years after opening.” It says it right there in their own report; every nine years a remodeling is taking place. Remodeling and updating is not cost free, so why exclude depreciation charges which reflect capital expenditures? I understand that perhaps you would want to strip out one-off opening costs, that’s fine and fair, but don’t go overboard.
The number of restaurants increases by 26 (previous year: 13) to a total of 205. The increase consists of 27 new openings and one closure. Group revenue grows to an astonishing 325 million euros but here comes the shocker, operating profits turn negative to 25 million. Fine, strip out foreign exchange losses of 3 million, IPO costs of 5.8 million and new opening costs of 6.1 million and you still have 10 million euros of operational losses. All the while the debt load of almost 130 million hasn’t materially changed, so those operating losses are before a six-million-euro interest payment. 184 million euros are raised through the IPO of which 85 million go to the company. This money is earmarked for further expansion as the group has ambitions to almost double the footprint to 330 restaurants by the end of 2020. The company is currently not profitable on an operating basis, and still wants to expand aggressively? I don’t get it. The remaining 100 million euros of the IPO money raised is distributed to co-founder Gregor Gerlach and Wella heirs Hans-Joachim and Gisa Sander. The family office of the former Tchibo owners Günter and Daniela Herz with a 44% stake, don’t sell a single share. After the IPO, 32% of all the company’s shares are now in free float.
One year later, in 2018, things get even worse. Revenue grows to 371 million, but operating losses mount to 85 million euros, that’s before interest expenses of 9 million. Even the beloved EBITDA figure turns negative, meaning the operating business before any expansionary or even maintenance capital expenditures is loss making. All regions are experiencing significant deterioration in their earnings profiles. Like for like sales are down 1% across the board. That’s revenue, not profitability. The question naturally arises: is the Group approaching its natural saturation point here or this operational by nature? The operating cash flow is now 9 million while financing cost are close to 7 million. That leaves 2 million for maintenance capital for 74 own restaurants and 76 joint ventures ones. Describing this as financially tight, would be an understatement.
Things are not looking good at this point. Yet the company still grows restaurants by 26 new sites. 64 million euros are spent on acquisitions, new openings, and maintenance costs, financed through a 20 million-euro equity raise and 72 million of new debt. The Company now has net debt outstanding of over 160 million euros. After the equity raise and by the end of the year 2018, Mayfair owns 47.4%, VAP Leipzig, Gregor Gerlach’s entity owns 18.9% and the Sander couple own 15.5% of the company. Yes, the Sanders and Gerlach may have taken 100 million euros off the table, but they still have substantial skin in the game. Plus, Mayfair hasn’t sold a single share and instead injects more money into the company through the equity round. The stock has now fallen from its IPO price of 23 euros per share to under 6 euros by the end of 2018. Something must be done here. And indeed, there is pivot in strategy and a hard push for change. At last, the management team abandons its aggressive growth plan and curtails new openings significantly. Additionally, the team wants to run a thorough analysis of weak locations to then either discontinue or sell sites. In Europe, the operating focus will be put on corporate restaurants and joint ventures in major cities to ensure the ideal size and location to match the respective demographic target group. Outside of Europe, the franchising business is being expanded and at the same time a consolidation of the existing corporate and joint venture markets is being sought. All future investments will be reviewed to achieve higher rates of returns on new openings. Investments are also being made in the renovation of older restaurants. The goal in the future is to also open smaller formats, like Mini-Vapianos (less than 400 square meters) or Freestander at prominent transportation hubs outside city centers (currently in Fürth and Toulouse) to cater to individual location requirements, and to enter new partnerships. I am not sure why management hasn’t stopped all expansion altogether, bringing the ship in order first, getting profitable, clean up, all hands-on deck before considering any further expansions whatsoever. But again, it’s easy to comment from the sidelines; maybe they saw white spaces that would be covered by competing concepts if they weren’t moving fast and aggressively enough. Although pushing internationally means competing with local players such as Jamie's Italian, Prezzo, Pizza Express, Wagamama, Nando's and many more which brings in its own dynamic.
Management also aims to enhance guest satisfaction. This involves refining operational processes, reorganizing the support center, and refocusing on the core offering: providing fresh and high-quality Italian food at affordable prices for a broad audience. The group also aims to reduce waiting times, especially during lunch, while also improving the evening atmosphere. There is even what I would call an evolution, away from Vapiano’s original concept, reorientating the customer journey. The ordering flow is being changed, offering guests synchronized preparations of all dishes while eliminating wait times at the cooking stations. The open show kitchen remains, staying true to original mantra of freshness and transparency but now guests can choose their preferred method of ordering through a mobile app, using a digital order point (kiosk), or by personally placing an order with a waiter. Guests can still freely choose their table and are then informed about the complete preparation of their order through a pager or their smartphone. This is a substantial deviation from the original concept, but a needed one. The group is also exploring and implementing the expansion of take-away and home delivery services but only at suitable locations, not universally across new openings. I am not sure why home delivery is even a priority here; it adds operational complexity. It’s better to clean up shop first and get back to the basics before adding new complexities. To be fair management does try to simplify. There are 49 different permanent dishes on the menu and additional 10 seasonal ones. Customers can choose from eleven different types of pasta. There is simply too much choice, and it makes orders complicated. The company announced to slim the menu down to its most popular and typical Vapiano dishes. There’s no need for an Asian salad at an Italian restaurant. "We have to go back to the roots, i.e. classic, honest Italian cuisine" says COO Everke. Regardless, in November of 2018, the supervisory board pulls the plug on CEO Jochen Halfmann and replaces him with Cornelius Everke. Everke himself has just become COO five months ago. Since 2017 he was responsible for international expansion. From 2011 to 2017 that role was filled by Mario Bauer – put a pin in that name, he’ll play a key role in the groups fate later. Then nine months later, in the middle of 2019, Cornelius Everke quits. He essentially concludes that his skillset and experience in the areas of internation expansion is no longer needed in the foreseeable future. To put it differently: Vapiano has moved from a growth story and has become a restructuring case, and other skills are required for that job. In June of 2019 Everke says the following “(we’ve) made a bit of a mistake when it came to foreign expansion”. No sh#t. Vapiano postpones the presentation of the 2018 annual financial statements three times in the spring of 2019, citing negotiations over an urgently needed loan of 30 million euros. It’s not until the end of May that a binding loan commitment comes through from the financing banks and major shareholders.
We are now in August of 2019 and the corona pandemic is just around the corner. Supervisory board chief Vanessa Hall takes over as interim-CEO and things are unravelling. Visitor numbers are declining; originally, it was planned to sell the US business but halfway through the year the buyer cannot come up with the money. But not all restaurants are performing poorly. The group's poor figures contrast starkly as an example with the experiences of the Swiss-German franchisee, who runs six restaurants. The Sodano family in Switzerland pays Vapiano a royalty of 6% of sales for the use of the brand. Enrico Sodano explains in an interview that they operate largely autonomously from the licensor. If an “accident” were to occur, he could immediately replace the Vapiano sign with Sodano, he says. The family concluded the rents and contracts with employees and suppliers independently. The Sodano family have six locations in Bern, Basel and Zurich, around one million guests every year and 350 employees. Things are going well on the ground. The delivery service they’ve built is offering them a second income stream. Expansion into Winterthur, St. Gallen and Lucerne are being planned; small locations with 150 to 250 square meters and an attached delivery service. Originally, Vapiano restaurants used to be huge but for such a large restaurant to be profitable, 800 to 1,000 guests per day are needed. That’s possible in medium-sized cities, but not in smaller towns which is why the Vapiano group now also supports smaller formats. Back to our corporate drama. The 2019 annual report would be the last report the group files. By the end 2019 the outstanding debt of the company is at an astronomical 450 million euros. Revenue has grown by another 7%, produced by four net new openings through two JVs and two franchise restaurants but operating losses come in at 317 million euros. That sound like an absolute shocker at first but depreciation and amortization charges are 345 million, so that operating cash flow is actually positive but unfortunately capital expenditures and interest payments are so large that they are eating up all of the company’s operating cash flow. Then in the beginning of 2020 Corona hits with full force and the world shuts down. As a result of the measures to prevent further spreading of the virus, the group is forced to cease all global business operations (except in Sweden). While all these shutdowns are happening, the group is the middle of negotiating with its lending banks and main shareholders. There are additional financing needs for restructuring measures, even without a pandemic happening in the background. The situation is so dire that the company starts pleading to the German government to roll out the package of financial help more quickly. Unfortunately, it’s to no end. The rapid closure of restaurants and the resulting lack of operating cash inflows in conjunction with the additional financing requirements, lead to the company’s final knockout punch. In April of 2020, the Vapiano group officially files for insolvency proceedings. The end of an era.

New Beginnings

Because of the pandemic, the majority of the group's subsidiaries in Austria, the Netherlands, Denmark, the United States, Sweden, and China also file for insolvency or seek liquidation. The US business never gets sold in the end and is wound down. In the summer of 2020, significant group divestments occur, including the sale of 75% shares in the group's French subsidiaries, shares in franchisor companies, Australian subsidiaries, German subsidiaries, associated companies, self-managed restaurants in Germany, and insolvency-related sales in the Netherlands, Great Britain, and Sweden. The buyer of the Vapiano brand and one of these bundles of Vapiano restaurants is company named Love & Food Restaurant Holding, a consortium led by Mario C. Bauer – a name I told you to remember. Bauer was a former Vapiano board member and led the national and international expansion, opening 200 sites in 33 countries from 2011 to 2017 until he was succeeded by Cornelius Everke. Bauer didn’t feel comfortable with the IPO at the time but clearly has a lot of managerial and entrepreneurial talent.
The buyer consortium is an absolute A-Team comprised of European QSR top league hitters, including the founder of the Pret A Manger chain Sinclair Beecham; Henry McGovern, the founder and Ex-CEO of the giant international restaurant and foodservice operator AmRest; the Van der Valk Family that runs hotels and Vapiano restaurants in the Netherlands, and co-founder and ex-CEO Gregor Gerlach. The acquisition value is 15 million euros and entails 30 Vapiano restaurants in Germany, albeit that’s just the purchase price which comes on top of any capital investment needed to refresh and return the sites to its former glory. Nevertheless, just as a thought experiment, if you can get each site to 2 million euros of revenue and 400,000 euros in operating profit on average, which wouldn’t be an overly aggressively assumption given the company’s history, you’ve got yourself a package that can deliver restaurant-level operating profits of 12 million euros or more. It’s not disclosed how much capex was needed to refresh the operations, just that fact that the overall investment plus purchase price was a middle double-digit million-euro figure. Stil, it probably was a decent purchase. The same consortium buys Vapiano’s French business for 25 million euros just two weeks prior. After the transaction concludes, the master franchise is given to Delf Neumann and his Gastro & Soul GmbH. Neumann is an experienced operator, and he is ambitious to revitalise the brand with new services and products. For example, instead of pizza, the restaurants will be serving pinsa - a flatbread made from sourdough, wheat and rice flour, topped similarly to a pizza. It targets a more health-oriented customer base looking for a less calory heavy option. The menu overall is expanded by including a variety of vegan and vegetarian dishes.
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Today Neumann’s Gastro & Soul GmbH operates 18 Vapianos on its own account and has 29 franchise sites, amongst other brands. By the year 2021, Vapiano operates 191 restaurants in 34 countries. This is around 50 fewer sites than before the bankruptcy. The number of branches is particularly thinned out in Germany – from 80 to 55. Nevertheless, Vapiano's home country remains by far the largest market, followed by France with 35 restaurants and Austria with 15 locations. “We have shrunk ourselves to health,” says Bauer in the aftermath and there is no further shrinking planned. Quite the opposite, the smell of expansion is in the air again – pun intended. Not as aggressively as before and with a new menu and ordering process.
Overall, the team around Bauer is filled with industry experts with knowledge and networks gained over decades who have a great track record, a long-term view, and the staying power to let Vapiano breath and finds its way back to success. The pressure of being a public company with all the associated quarterly, half-year and yearly disincentives have been removed. The menu is changed and extended with new types of pasta and sauces with significantly more vegetarian and vegan dishes available. Guests can order with restaurant staff, at terminals or on their phones and there are barcodes attached to the tables identify the respective seat. The food is brought to your table, all at the same time if you are in a group, no more annoyances with waiting in line. There is a plan for smaller, 350 square meter locations, with half the number of guests and significantly fewer staff and less set-up costs required to make the economics work. Locations that capitalize on remote work and increased demand for local lunch options, higher population density with shorter delivery routes and therefore cost-effective in house delivery services are targeted. And Bauer is testing the concept of ghost kitchens, which operate without a dining room or service staff, focusing solely on preparing food for delivery services, which for obvious reasons have a very different operational set up and footprint. Original founder Mark Korzilius however is not entirely convinced. He is not a fan of the pinsa for instance and he considers Vapiano's pizza as its cash cow, flagship product and believes that the core Vapiano proposition of Pizza, Pasta, Bar that has given the company its original success is being diluted. He instead admires the competitor L'Osteria, saying they’ve done a better job by focusing on Italian classics, especially the impressively large pizzas that sticks out beyond the plate is leaving every customer in awe. The guys who run L’Osteria are the same guys who have built Vapiano with him in the first place. Bauer on the other hand, like a true business leader, remains undeterred, stating that he is frequently asked whether Vapiano's restart was bold or foolish. He believes in entrepreneurship, franchising, in his experienced fellow partners and importantly the Vapiano concept. By the year 2024 you can find over 140 Vapiano branded restaurant in 27 countries across the globe, including locations far away from its birthplace like Australia, USA, Columbia, Chile, Bahrain, and Saudi Arabia. And why not? Italian food is, and will remain to be, incredibly popular. Vapiano offers fresh and tasty food at affordable prices in a good atmosphere. This combination of attributes should attract a lot of customers. It certainly has in the past.
For more stories: WIP Thomas Weitzendoerfer Substack