IGold Q4-07 vs Q3-07Well Q4-07 is over and soon the Q4 operational and financial nr's will be coming in. I'm quite excited regarding gold and the gold stocks. In CAD dollars, the POG avg in Q4-07 was ~C$775/oz versus ~C$725/oz avg during Q3, and therefore the IGold JV will have received $50/oz more in Q4 than in their last reported Q3. On top of this, the IGold JV should report more production (assuming the scoop downtime didn't bite too hard) and significantly higher gold ore grades during Q4 vs Q3.
Recall that in Q3-07, the IGold JV sold 7.2K oz of gold at ~C$710/oz and received revenues of C$5.1M.
The news release issued late Nov 2007 forecasted total FY07 IGold prod at "over 32K oz"..... which would translate to JV Q4 prod ~9.0K oz gold and gross revenue of ~C$6.8M and profit ~C$3.4M; approx $1.0M of this Q4 net will go to Pat (Q4 being the first Q of commercial production and cashflow for Pat).
Looking forward to Q1-08 increases the excitement quotient, for me at least. Yes there will be volatility so fasten your seatbelts. But if for Q1-08 we plug in C$800/oz gold and ~11.0K oz JV IGold prod and keep expenses consistent with 2007, then my Q1-08 calculations yield a profit of ~$4.7M to the JV of which ~$1.4M will go to Pat. The price of gold in $CAD is really important in all of this; today it's at approx $C880/oz.
Besides PAT, I own several larger gold stocks including a longterm hold in Red Back (RBI), some recent Yamana (YRI), a bit of Western Goldfields (WGI) and some XGD ishares too, all of which are participating in this latest gold rally over the past month. In the past 2 months I sold the last of my smallish junior explorers Miranda (MAD) and Everton (EVR) because they weren't participating. Similarly, I have been watching explorer Niogold (NOX) since poster Reccos recommended it here on the Pat board at $0.59; today it remains stuck at $0.26; so this small gold explorer is not participating either.
Similarly, we all know that our small PAT has not participated in this latest gold run. But I'm not worried and am confident that the PAT shareprice will soon respond (my guess, sometime in 2008) to its increasing underlying asset value. Remember that unlike the junior gold explorers, Pat now has money flowing into its coffers. The (hopefully) strong $pog and the jump to 45% JV share late in 2008 only enhance the profits. Yes, I'm excited.
If the PAT shareprice doesn't move up by late 2008 and if Pat hasn't been taken out, then I'll re-assess. By that time, (assuming the IGold JV mine remains in production and/or the $pog doesn't collapse) Pat will be able to make the following decisions.... 1) buy back its shares, 2) begin paying a dividend, 3) buy new properties. My vote would be for the first two. Yes, I'm quite optimistic about my PAT shares. I own a good chunk (for me) of PAT and so my money and my mouth are in the same place.
Anyhow, that's how I see things unfolding for Pat in the next 12 months. Feel free to argue any of my above points. Cheers.