Hard to see where this is going at the moment. I expected the March quarter to give a fair indication but once again MAT under performed.
January figures were 4000t of ore at $1650 AISC, for what was only 2 weeks of production. The expectation was for a big Feb and March after most of the Dec Qtr and start of January was used for development and allow better access to higher grade gold and double shifts.
Somehow we ended up with only 15800t put through for the quarter and AISC was $2370. Just as well gold had a stellar run otherwise MAT would’ve lost money.
Now April looks fine. 7500t for the month is great, but that’s about what Feb and March also should’ve each been judging by figures of the last 2 weeks of January, so for me the jury is still out and I guess for the market also, judging by the share price response to the figures.
With gold doing so well at the moment, it’s hard to see how this won’t be a profitable quarter, but the tonnage needs to match April for the next 2 months so we can gauge the potential of Red October.
I’m not impressed with 1 good month as that’s sometimes just a tactic of a company’s management to deflect from the real picture. Anyone invested with WPG can attest to that. It was always a case of ‘Yeah it was a poor quarter, but look at how well this quarter new quarter has started’. Ultimately the result was overall poor performance. It was a trait of WPG and CTL, and both went broke. A more recent case is MOY. Always expecting more ounces than they would achieve. Having gold in the ground means nothing if a company can’t extract it at a profit.
$2370 AISC for the quarter needs an explanation as it is so far above expectations, even allowing for the first 2 weeks of January.
The next 2 months will be telling. Put some consecutive good months together and form a pattern that investors can have confidence in. Hasn’t happened here yet. Hopefully it will this quarter.
