Claude Res Inc CLGRF

RE: 2005 results

[oddykog]

Yes, they clearly did not want to put them out without letting people reflect. The cost side has clearly gone out of control at the gold production levels that Claude has historically had. Luckily they have been spending heavily at Seabee to get production up to the 100 000 ounce level and seem to be on track to get there in 2007. 2006 will be an intermediate year with some improvement in gold production and some higher pricing in C$ terms. Gold in C$ today is listed at $641.76 versus a 2005 average price of $549. Those extra $90/ounce would have made the difference to a profitable year if that had been the price, even at the high C$. Also, though they have sold some of their equity investments, they still have about $6 million of unrealized appreciation in their portfolio. Personally, I was disappointed that the oil and gas hedge had not offset the higher costs more effectively. I suspect the rising costs for labor, energy and consumables will be a fcator in many company's reports this year