Standard Metals Processing Inc (OTCMKTS:SMPR) Takes a Pounding

Standard Metals Processing Inc (OTCMKTS:SMPR) was in a bad way a few months ago. The stock was hovering between $0.70 and $0.80 per share and although it was holding up relatively well, the microscopic volumes meant that it wasn’t about to run higher and give investors a chance for a profit.

To be fair, it didn’t really deserve to go higher. The press releases were next to non-existent and the financial statement was pretty gruesome. When we say “gruesome”, we’re not exaggerating. Here’s a summary of the figures:

• cash: $789
• current assets: $16,250
• current liabilities: $8,750,489
• NO revenue
• quarterly net loss: $41,061,977

The colossal net loss is the result of impairment of SMPR‘s Shea Mining and Milling assets which showed pretty definitively that the prospects for the company weren’t very good at the end of Q2. All in all, there wasn’t a whole lot to entice you into jumping in, but then, a light at the end of the tunnel appeared.

Just days after the company published the dreadful figures you see above, SMPR announced that a person by the name of Bobby Cooper has agreed to take the helm. According to the press releases, he is something of a celebrity in the mining industry and he has been instrumental in the building of some of the leaders in the sector.

Curiously enough, the market didn’t react to Mr. Cooper’s appointment, and it must be said that considering the long history of failures, investors’ reluctance to put their money on the line was understandable. Nevertheless, some other experienced people took leading positions at the company and, probably in an attempt to sever all connections to the past, SMPR also announced an upcoming name change and a slight tweak of the business plan. In a word, it looked like the company was being transformed from an all-but-dormant OTC mineral exploration wannabe into a serious mining entity.

All of a sudden, however, it all fell to pieces. Mr. Cooper along with the rest of the people that were appointed in September decided to terminate their agreements with SMPR and the company was once again left in the hands of the previous management team. Of course, they promised that they’ll look for someone just as experienced and competent as Mr. Cooper to lead SMPR to a brighter future, but it’s quite clear that investors aren’t entirely convinced.

Once again, there was no immediate reaction to Mr. Cooper’s resignation, but the blows eventually came and they were quite heavy. The first one wiped out 60% of the market cap in a matter of a single session last week and the second one came yesterday when a further 76% went down the drain. The ticker finished Monday’s session at a new all-time low of $0.0128 per share.

That’s a pretty horrific drop, you have to agree, but there are people who are still able to find a silver lining among all the thunderous clouds. These people reckon that after such a horrible crash, a bounce is basically inevitable and they might turn out to be right. Even if you decide to play with the stock, however, you mustn’t get too carried away. Some people learned how painful that could be and sadly, they learned it the hard way.