The cut off grade for the reserves was calculated on a gold price of $3,750. I don't think this is optimistic at all given the current gold price is closer to $5,200. All other reserves are currently priced using a $3,000 gold price or less so I don't think the company is overcooking anything.
It's actually nice to see them talking up their assets for a change.
Re share price there are many forces at play including institutions who may want to be holding the price of VAU back. There was an interesting discussion recently on money on mine about Rayleigh Finlayson good relationship with institutions. While we can bemoan the poor performance of the board (LT at the end of the day is accountable to them), institutions can move the share price around if they wish with very little transparency due to nominee holdings and the 5% disclosure threshold.
It should be noted a there a number of things holding the share price back and these will gradually disappear in the next 12-18 months which should in theory at least drive the share price higher.
These are
1) rolling off of the hedges 2) high capex (another 18 months worth with the mill upgrade) 3) elimination of tax losses leading to dividends in FY 27 4) restart at Sugar Zone and new mill lifting production 5) increase in margins especially at Santa Fe were stripping will halve and then halve again over the next two years.
So I am still very happy to be optimistic albeit impatient waiting for the share price to rise.
GLTA/IMHO
VAU Price at posting:
45.0¢ Sentiment: Buy Disclosure: Held
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