The Labours of Hercules

Hercules Silver put out a press release reporting the assay results of a single hole at its silver/copper project in Western Idaho. The hole included 100 meters of .76% copper within a longer 461 meters averaging .4% copper.

As with the last BIG news, the retail market greeted the release with a rush to the exits at the open. BIG sold off $0.10 from $0.76 to $0.66 in the first hour of trading. But, in the last half hour of the day it came back, hard. Finished the day up $0.02 at $0.79.

What happened? I, of course, don’t actually know what happened. But, at a guess, the nature of press releases and market reaction was in play. Itchy-fingered retail and traders saw the headline, “Hercules Silver Drills 100 Meters of 0.76% Cu, 113 ppm Mo, Within 461 Meters of 0.4% Cu, 74 ppm Mo”, looked at the grade, saw it was not over 1% and hit “SELL”.

Then, over the course of the day, people actually read the release and realized that the “grade” was not actually the story. It was fine and there was a lot of it, but hole HER-23-26 did something far, far more important.

Assay results have now been received for HER-23-26 and confirm that grade increases west from drill holes HER-23-11 to HER-23-21 to HER-23-26, and from HER-23-08 to HER-23-05.

Now you had to read all the way to the second paragraph to get this point. However, it sets up this weirdly placed bullet point:

• New assay data and deep penetrating 3D IP suggest the potential early porphyry center may underlie the entire mapped exposure of Hercules Rhyolite.

(Why people put bullet points in the middle of press releases beats me.)

The general geological theory of the Izee terrane is that the silver bearing rhyodite is the froth on a deeper copper porphyry. HER-23-26 is one more data point in support of this theory. Which is why the headline numbers needed context before their actual significance could be understood.

Looking at the trading and the volumes, it appears that the penny dropped with ten minutes left in the trading day and over 500,000 shares traded on the TSX-V with the price popping from $0.70 to close at $0.79.

Algos? “Smart money”? FOMO? I have no idea. Maybe my pal Peter Bell, who actually understands trading, will share insight in the comments. What I do know is that this was a terribly laid out news release which managed to, as we in the media biz put it, bury the lede.

Basic rule of press releases, put the most important point first.

The most important point here was that this hole confirmed the continuity of the copper porphyry. Only after you hammer home that point should you get into the details as to grades and intervals.

If the headline had read, “Hole HR-23-26 further confirms the copper porphyry at Hercules” with the current headline being a sub-head and the bullet points moved to the top of the release where they belong, the market would have been alerted early to the actual BIG story.

One other point. CEO Chris Paul’s remarks, while they certainly need a rewrite to focus on the real significance of hole HR-23-26, need to be much further up the page instead of buried below a graphic and an intercept table. CEO remarks are a very powerful explanatory tool for those of us who are not geos. This line, alone, would have steered readers in the right direction,

The first phase of blind drilling has now tested the copper porphyry system over a 500m x 450m area, with grades increasing to the north and west.

Especially if it had been the second paragraph of the release.

Despite being down about 30%, I am very pleased with the progress BIG has made and I am looking forward to this year’s drilling. But, honestly, Hercules, bring in a writer to do the final version of your press releases. Writers are not expensive, think three meters of drilling for this sort of rewrite, and the good ones can turn something like this around in a couple of hours.

[Disclosure: I hold a starter position in Hercules Silver (BIG.V) This is not investment advice. Do your own due diligence. ]