OGC, EDV, WM, ODV
OceanaGold aka OGC released its Q3 results, and they were excellent. Production was up sharply to 134,900 oz Au and 2400t Cu with the cash cost reduced all the way down to $987/oz Au. All of their mines in the US, the Philippines, and New Zealand markedly increased production, especially the Halle mine in North Carolina.
As a consequence, the financial numbers were also excellent, with OGC generating a Q3 net profit of $61M and increasing FCF to $66M. In spite of repurchasing $7.8M shares, they were able to increase their cash stash to $158.6M.
And they are forecasting an even stronger Q4. I hope all this success doesn't kibosh my plans. I recently sold some of my OGC shares with the idea of repurchasing for a dollar less as the correction in gold and gold stocks gets underway, but with these kinds of results, will the share price drop to my target? And with so much cash on hand plus operational excellence, OGC is certainly a buyout target unless they spend the money to buy someone else first.
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West African gold miner Endeavour Mining aka EDV also released its Q3 results, best described as mixed.
Although production was up to 270k oz Au this quarter, with cash costs reduced to $1128/oz Au. thanks to the new mines performing well, production was below expectations due to various factors, and although EDV now expects to meet the bottom end of 2024 guidance in terms of production, they also expect to miss guidance in terms of costs.
EDV was able to generate Adjusted Net Earnings of 30 cents a share and FCF of $97M. Because they spent $100M on dividends and $8.8M on share buybacks, as well as repaying $160M on their credit facility, EDV's cash stash was down to $252M at the end of Q3, but with a strong Q4 forecast, this is expected to grow substantially by the end of the year.
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FWIW, in response Scotia released a new analyst report calling the impact Negative, though they kept EDV at Sector Outperform with a target of $40. As well, BMO issued a new analyst report calling the impact Mixed but kept EDV at Outperform with a target of $45. Both analysts are keeping a close eye on operation performance in Q4.
Earlier this year Wallbridge Mining aka WM released the results of the Phase 1 drilling programme on the Bug Lake Zone, located about 500m from the existing Resource on its Martiniere gold project in Quebec. Following geological reinterpretation, they carried out a just completed Phase 2 drilling, and it was a success. With assays like 5.78 g/t Au over 3.9m, 15.63 g/t Au over 11.0m, and 27.60 g/t Au over 2.3m across three targets, Bug Lake could make a substantial contribution to the updated Resource Estimate for Martiniere which will be released in Q1 prior to more drilling planned for next summer. This in turn will feed into a combined PEA for WM's proximal Martiniere and Fenelon projects.
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Osisko Development aka ODV released an update on their Cariboo gold project under development in BC. The good news is that, though the language used is hard to parse, they expect to receive permits before the end of the year. However, they also tell us that they have been unable to come to an agreement with one of the local First Nations, though they do not say what effect this will have.
As usual with this crew, some of the information necessary to evaluate the information contained in the PR is missing.....
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Saville tells us that the PoG dipping below support at 2700 signifies that a multi-month top is in place.As well, he expects it to become clear shortly that a multi-month correction is underway in gold stocks.I hope you have like me built up your cash stash for the coming bargains. |
