Midtier Gold Producer Reports Q2 Results and Updates Guidance

Source: Streetwise Reports 08/16/2018 The figures provided incorporate the three Brazilian mines the company acquired earlier this year. Leagold Mining Corp. (LMC:TSX.V; LMCNF:OTCQX) announced Q2/18 financial and operating results for its four producing mines: Los Filos in Mexico and Riacho dos Machados (RDM), Fazenda Brasileiro and Pilar de Goias, all in Brazil. The numbers represent a full quarter of operations for Los Filos but only 38 days of operations (May 24 to June 30, 2018) for the trio of Brazilian assets. Leagold’s Q2/18 revenue was $86.9 million, and $10.1 million of it came from mine operations. As of June 30, 2018, the company had $69.4 million in cash and cash equivalents. Consolidated gold production during Q2/18 was 64,517 ounces at an all-in sustaining cost (AISC) of $950 per ounce of gold sold; Leagold sold 66,982 oz during Q2/18. Specifically, at Los Filos, Q2/18 gold production was 43,541 oz, 15% less than that in Q1/18, at an AISC of $967/oz. The decrease was due to fewer gold ounces being placed on the heap-leach pads in Q1/18 and the time lag in leaching recovery, along with underground grades being lower than expected, by 2–2.5 grams per ton. However, gold production at Los Filos, and therefore cash flow, in H2/18 should improve because more gold was placed on the heap-leach pads in Q2/18 than in Q1/18. Also, Leagold has commissioned an agglomerator, and high-grade material is being processed separately. “The Los Filos processing plan now schedules a significant increase in the uncrushed, nonagglomerated … Continue reading

Q2/18 Results Infer High Quality of Gold Producer's BC Mine

Source: Streetwise Reports 08/16/2018 A ROTH Capital Partners report interpreted this company’s quarterly results. In a research note dated Aug. 12, analyst Joe Reagor with ROTH Capital Partners reported that Pretium Resources Inc.’s (PVG:TSX; PVG:NYSE) Q2/18 financials were “in line with expectations” and highlighted the quality of the company’s Brucejack mine. Pretium’s Q2/18 revenue of $146.5 million ($146.5M) and earnings per share of $0.17 were higher than ROTH’s estimates of $141.2M and $0.16, respectively. “The slight beat,” Reagor noted, “can be attributed to gold sales exceeding production slightly, in our view.” Reagor pointed out that the day after the mining firm reported its Q2/18 results, on Aug. 10, its share price “increased significantly.” This was due to the market acknowledging the company “is putting its startup issues in the rear view” and showcasing the high caliber of Brucejack. During the quarter, the mine generated $72M in cash, and its all-in sustaining cost was $648 per ounce. “We note that some investors have continued to question the company’s ability to generate enough cash to buy out its gold stream by year-end; we believe this quarter’s financial results have gone a long way to answer that question,” wrote Reagor. ROTH has a Buy rating and a US$19 per share price target on Pretium; the stock is currently trading at around US$8.81 per share. “We continue to believe the company trades at a significant discount to its discounted cash flow value due to historic resource questions, and we believe that continued strong performance … Continue reading

Streaming Company Posts $318 Million of Net Earnings in Q2

Source: Streetwise Reports 08/16/2018 This precious metals firm highlighted that Q2/18 revenue and operating cash flow were up year over year. Wheaton Precious Metals Corp. (WPM:TSX; WPM:NYSE) announced its Q2/18 financial and operating results along with its most recent dividend. The company reported Q2/18 net earnings of $318 million, which included a $246 million gain from disposal of the San Dimas silver stream. Q2/18 revenue was $212 million, up 6% year over year (YOY). Sales volume was 6 million ounces (6 Moz) of silver and 81,100 ounces (81.1 Koz) of gold. Average cash costs in Q2/18 were $4.54 per ounce of silver sold and $407/oz of gold sold, higher than those in Q2/17, which were $4.51/oz and $393/oz, respectively. Adjusted net earnings in Q2/18 were $73 million, up 9% YOY. Cash flow from operations was $135 million, up 8% YOY. Reflecting on H1/18, President and CEO Randy Smallwood said in a news release, “Wheaton’s high-quality portfolio and strong margins generated over $260 million of operating cash flow” during that period. As of June 30, 2018, Wheaton had about $93M million of cash on hand and $957 million outstanding through its $2 billion revolving term loan. Along with reporting Q2/18 financial results, the streamer declared its third quarterly cash dividend for 2018. It was $0.09 per common share, up 29% from the dividend of the same period in 2017. Wheaton also provided recent noteworthy transaction updates, which included completion of two acquisitions. One was the cobalt stream from Vale’s Voisey’s Bay … Continue reading

Serendipity in Life and in Markets

Source: Michael J. Ballanger for Streetwise Reports 08/15/2018 Precious metals expert Michael Ballanger draws parallels between serendipity in life and in the gold and silver markets. I am back in the literary engine room after a two-week boating excursion into northern Georgian Bay complete with forest fires, travel restrictions and mechanical malfunctions—all part and parcel of navigating the ever-steepening learning curve of boating. As an individual trained in finance, nothing is more terrifying than turning on your marine generator only to see blue smoke pour out of the exhaust pipe. Being without battery power four hours from the closest marina is analogous to being up “Effluent Creek” without the proverbial paddle. However, the reason I used word “serendipity” as the title of today’s missive is because of a series of events that occurred last week while we were moored in the Massassauga Park, a boater’s paradise located near the Moon River as it empties into the bay. Friends of ours awoke one morning to find that the generator/inverter on their big Chris Craft was acting up and after a series of attempts to rectify the problem, it was apparent that this was a non-fixable issue and they were forced to head into the closest marina to access shore power so the batteries would not die (which is a big no-no with $8,000 as a replacement cost). Now, if you have ever been into the engine room of a big boat, you know that they are designed for tiny people with … Continue reading

Gold Miner Drills a New Copper-Gold Discovery

Source: Streetwise Reports 08/15/2018 A minerals explorer announces a new alkalic copper-gold porphyry discovery in British Columbia’s Golden Triangle. Golden Ridge Resources Ltd. (GLDN:TSX.V) recently announced a new alkalic copper-gold porphyry discovery at its Williams Zone prospect, located on its Hank project in British Columbia’s Golden Triangle. According to the company, hole HNK-18-001 intersected a broad interval of vein and disseminated Cu-Au-Ag mineralization. The steeply dipping tabular monzonite intrusion has now been intersected in all four holes drilled in the Williams Zone, indicating a strike of at least 200 meters. “The size and grade of the Williams Zone discovery are remarkable. Broad intervals of intense potassic alteration with bornite and digenite indicate the presence of a large alkalic Cu-Au porphyry system at surface. Indications are that only the top of the system has been intersected, including the presence of widespread phyllic (aka quartz-sericite-pyrite) alteration at surface, which typically overlies porphyry Cu-Au systems, and exists both above and lateral to the potassic altered monzonite at Williams. Copper mineralization also extends for a considerable distance into the surrounding volcanic rocks, while the mineralized monzonite shows good continuity along strike and at depth,” said Chris Paul, vice president of exploration for Golden Ridge. The latest hole completed in the Williams Zone, HNK-18-007, ended in mineralized monzonite at 603.50 meters depth, and the company reported mineralization appears to increase at depth. The system remains open along strike in both directions and at depth. Assay results will be released as they are received. [NLINSERT] Disclosure: … Continue reading

Prospect Generator Got Away, But Now Returns

Source: Adrian Day for Streetwise Reports 08/15/2018 Fund manager Adrian Day discusses a mineral exploration company that has added value through the drill bit. In recommending Evrim Resources Corp. (EVM:TSX.V, CA$1.06), at the beginning of the year, there seemed no rush to buy. But coincidentally, another newsletter writer, well respected, recommended the stock on the same say, calling it his pick of the year. The stock shot up and we missed buying at our limit. His recommendation took the stock from 25 cents to 30 cents the same day. We decided not to chase it, but the stock never looked back. Following that, some strong drill results and a subsequent initial resource estimate were released on its Ermitaño property, optioned to First Majestic, and on which Evrim retains a 2% royalty. These items of news took the stock first to 40 cents, and then to 50 cents. Immediately thereafter, trench results from an untested, 100% owned project, Cuale, were released, including an astonishing 1.28 grams per tonne over 351 meters (of which a more astonishing 2 grams plus per tonne over 193 meters). The stock shot up to 90 cents. Further results the following week, including 106 meters grading 13.6 g/t, took the stock to a high over $1.50. Yes, we missed it alright. This is one case where a strict buy limit worked to our disadvantage. Of course, in January we did not know that Cuale had this kind of potential; it was just one more property, untested, in … Continue reading

Gold Explorer's Projects Offer 'Significant Room for Value Creation'

Source: Streetwise Reports 08/14/2018 A ROTH Capital Partners report relayed the key points from the company’s quarterly update. In an Aug. 12 research note, Joe Reagor, analyst with ROTH Capital Partners, reported that near-term upside exists in two of Seabridge Gold Inc.’s (SEA:TSX; SA:NYSE.MKT) projects and that the company’s Q2/18 results were “slightly better than expected but generally uneventful.” Reagor noted the market responded favorably to comments by Seabridge’s management about the exploration potential at its Kerr Sulphurets Mitchell (KSM) and Courageous Lake projects, where “we continue to believe there is significant room for value creation.” Drill results from KSM’s Iron Cap are expected to be catalysts, later in 2018. Also, drill results from recent Courageous Lake findings “could lead to significantly improved project economics.” The analyst highlighted that ROTH views the market’s reaction as warranted. “We base this belief on the company’s potential for resource growth through exploration and a lack of a response to prior announcements regarding discoveries at Courageous Lake,” he added. As for Seabridge’s Q2/18 financial result, it was a $0.04 per share loss, which compares to ROTH’s estimate of a $0.06 loss. “We do not view this as a meaningful beat as the company remains a pre-revenue company,” Reagor qualified. He reiterated ROTH’s Buy rating and US$17 per share price target on Seabridge, which is trading currently at around US$12.90 per share. Read what other experts are saying about: Seabridge Gold Inc. [NLINSERT] Disclosure: 1) Doresa Banning compiled this article for Streetwise Reports LLC and … Continue reading

Explorer Hits Big Gold at Forrest Kerr in the Golden Triangle

Source: Rick Mills for Streetwise Reports 08/13/2018 Rick Mills of Ahead of the Herd discusses the recently released drill results from the first hole of the summer season, which he terms “spectacular.” Aben Resources Ltd. (ABN:TSX.V; ABNAF:OTCQB) whacked it out of the park on Thursday with the release of assays from the first hole of the summer drill program at Forrest Kerr, its property in the highly prospective Golden Triangle area play of northwestern British Columbia. Multiple high-grade zones ABN’s 2018 drilling in the North Boundary, a new mineralized zone discovered at the end of 2017’s drilling season, has intersected multiple high-grade zones and precious metal values, near surface. Hole FK-10, the first of eight holes drilled during the first batch of the current 4,000m program, features four separate high-grade zones all within 190 meters downhole. The hole was drilled 35 meters northwest of discovery holes FK17-04, 05 and 06 from last summer. It significantly increases the North Boundary Zone of precious and base metal mineralization, according to ABN’s press release. The highest-grade zone assayed at a whopping 331 grams per tonne (g/t), or 9.65 ounces per tonne, over 1.0m, within a broader zone of 38.7 g/t over 10m. The results from other high-grade zones in the discovery hole included 22.0 g/t gold and 22.4 g/t silver over 4.0m, 4.0 g/t silver over 13.0m, and 8.2 g/t gold with 1.4 g/t silver over 6.0m. The hole was drilled 230m north of a high-grade historical hole drilled by Noranda in 1991, … Continue reading

Jack Chan's Question: Is This an Exhaustion Gap or a Breakaway Gap?

Source: Streetwise Reports 08/13/2018 In his weekly precious metals market update, technical analyst Jack Chan charts the latest moves in the gold and silver markets. Our proprietary cycle indicator is down. The gold sector is on a long-term buy signal. Long-term signals can last for months and years and are more suitable for investors holding for long term. The gold sector is on a short-term sell signal. Short-term signals can last for days and weeks, and are more suitable for traders. Our ratio between gold and gold stocks is on short-term sell signal. Speculation on gold is at a multiyear low. Silver is on a long-term buy signal. SLV is on a short-term buy signal, and short-term signals can last for days to weeks, more suitable for traders. COT data is at levels of previous bottoms. UUP, ETF for USD, gapped up on Friday. The question is, is this an exhaustion gap or breakaway gap? Over the years, my observation on such a gap after an extended rally is often an exhaustion gap. FXE, ETF for the Euro, may help shed some light. Friday’s gap had the lightest volume relative to the two previous gaps, a sign of selling exhaustion. SummaryThe precious metals sector is on a long-term buy signal. Short-term is on mixed signals. The cycle is down. From a contrarian point of view, the current extreme bearish sentiment is an excellent buying opportunity for long-term investors. We are holding gold-related ETFs for long-term gain. Jack Chan is the … Continue reading

Turning Dimes to Dollars in British Columbia

Source: John Newell for Streetwise Reports 08/13/2018 John Newell, technical analyst and portfolio manager with Fieldhouse Capital Management, profiles a prospect generator exploring in and around British Columbia’s Golden Triangle. Goliath Resources Ltd. (GOT:TSX.V) is a precious metals project generator focused in the prolific Golden Triangle and surrounding area of northwestern British Columbia. Why the Golden Triangle? Much has been written about British Columbia’s Golden Triangle, as it is one the richest reservoirs of metal in the world. The Golden “Triangle,” “rectangle” or more aptly, a “Golden Corridor,” as we like to call it, is one of the most richly mineralized areas in the world. This Golden “Corridor” is a small part of a much larger geological feature of the Pacific “Ring of Fire.” It is associated with some of the largest and richest mineral deposits in the world, from Indonesia through Japan, Alaska, the Yukon, down through Nevada, to the metal-rich Mexico, Colombia, Peru, and the massive copper deposits of Chile. The Golden Triangle is at a much earlier stage of exploration than other mineral-rich areas like Nevada and Chile. However, with the recent snowpack and glacial abatement in the area, new exciting targets are now being exposed at surface and being seen for the first time in +12,000 years. Also, the success of Pretium Resources Inc. (PVG:TSX; PVG:NYSE) that began production last year and Seabridge Gold Inc.’s (SEA:TSX; SA:NYSE.MKT) massive, ever-expanding KSM and Valley of the Kings deposits have encouraged new infrastructure buildout, such as new roads, rail … Continue reading