GLK didnt YET commission their plant in Ontario (Disclaimer : I...

GLK didnt YET commission their plant in Ontario (Disclaimer : I am a very long term supporter and shareholder of GLK so my opinions are biased, GLK is my third favourite graphite investment after Bass Metals (BSM) and Elcora Advanced Materials (ERA)). What they are doing is innovative, they are playing the middleman/allocator of resources. Sourcing their graphite from abroad, micronizing it in a pilot plant in canada, and selling it to customers ! not even using their leased plant yet (so many possible reasons/theories why the plant is not yet functioning yet, but thats another subject altogether).

GLK is focused on Sales (they got Mike Coscia as VP, an experienced graphite salesman) the idea is that it is not that hard to produce graphite, but it is difficult to find customers and convince them to convert from their old trusted suppliers to a new junior like GLK, so their focus is sampling and working closely with their prospective customers to tailor the production to their needs. GLK is also focused on value added graphite and they dont care if graphite is natural or synthetic, they produce what customers want !

Indeed the direct competitors of GLK are the likes of Asbury carbon. I posted this in another forum (stockhouse) a while back :

IMO there are two main risks for GLK :

1- Are they gonna be able to ramp up sales and find more clients with repeated long term orders ? selling hundreds of tonnes of micronized graphite to 2 or 3 customers is one thing, building a business with thousands of tonnes of sales per year to a set of diversified and long term clients is the biggest challenge and the goal they are aspiring to achieve.

2- Are they gonna be able to make decent profits for a sustainable profitable business ? again, making some dollars per tonne is one thing, but making enough profits (which depends on margins) after General and Administrative costs and taxes have been paid is the biggest challenge.

These risks are simply the same for any new business but wiih variable levels of challenges (some businesses are tougher than others due to difficult entry to market, thats the case of monopolistic/oligopolistic markets). However, the rewards in case of success differs greatly from a business to another. IMO the rewards in case of GLK success (value added graphite) are huge, and the risk/reward opportunity for investors is absolutely worth it. GLK could be simply what the doctor ordrered : a processing graphite company in the right time, right place.