Ann: Record monthly gold production at King of the Hills, page-24

This quarter is the last quarter that you can buy this company cheaply. Here is why:

Production
April - 18,633
May - 16,500 (est) - assuming they process from stockpile at 1.2g/t grade
June - 18,091 (using mid point of March and April).

Total quarter production = 53,224 Oz.

25,565 Oz to be delivered into hedge at $2,309 and balance of 27,659oz into the spot market of say $2900/Oz.

Total revenue = 135.229m

Total production cost $81.5m (march qtr numbers). Add 4m in corporate overheads, 3.5m in financing cost and you have total expenses of $89m.

So profit of $46m.

From that, assume $15m of growth Capex and exploration which leaves net profit of 31m. Or an annualised profit of $120m. With a market cap of only 620m, this is a PE of 5! Can't see how this is justified. Imagine how quickly they can repay the debt if they keep churning out the results! Net debt free by Q3 or Q4 of FY24

So why is the share price so low? I offer the following:
- markets haven't cotton on to how the current gold price adds so much free cash flow to the gold sector;
- capital raising overhang
- markets don't believe that red can produce the results.

I think this will be revealed in the next quarterly. So this quarter may be your last chance.