Im out
i sold out of all of my klondex today because of the forward sales, most of it is in Q2 and Q3 so they may actually be right and this works out fabulously for them, i may get back in, in september. here is excerpt from the conference call.....
The one thing I really want to touch on real quickly is the forward sales. Since I joined Klondex in 2012 we’ve always said, we maintain that we will run Klondex as a business. And in looking at our forward sales, we once now for two quarters actually have some predictability. We’re very bullish on gold. I want to comment on that. In fact, some of our forward sales are just under $1,300 an ounce, they’re above $1,292.
But our forward sales, the average are approximately $160 an ounce higher than our budget on gold and approximately $3 an ounce higher than our budget on silver. For every $50 in movement in gold price it’s approximately $7.5 million in revenue and every $1 in silver it’s approximately $1.5 million in revenue.
We looked at several variable things before we did our forward sales, one of which was consensus pricing. When we looked at the crystal-ball from the major banks, their consensus pricing for 2016 was between $1,200 and $1,300 an ounce. It’s not that far back in my memory that gold was $1,050 an ounce.
This forward sales is wide open Q4, which coincides with the best grades we have for 2016. And just to repeat that, our grades for the areas we’re going to mine are better in the second-half and Q4 are the best grades. So Q4 remains wide-open, and we’re looking forward to take advantage of that higher metal price.