GREY:GRFJF - Post by User
Post by
SkyeCairnson May 07, 2008 9:40pm
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Post# 15049591
It's Getting Better
It's Getting BetterI admit it's getting better
A little better all the time
It can't get no worse
Yes I admit it's getting better
As the company was conservative on its costs it forecast 1st quarter costs "exceeding 1,000 per oz" back in early March so lets assume its forecasts are not too far off the mark for the 2nd quarter or at least it has NOT overestimated the net profit. Based on the spot price so far this quarter (2nd), cost of goods sold of 456-435 ,oz sold of 41,000-45,000 and lets assume no P&L impact on the MTM of the gold forward contracts I come up with the following eps for the 2nd quarter:
Best Case : 0.12 eps
Worst Case: 0.10 eps
The hedges don't come into play until 3rd quarter and I have assumed the cost/production is the same in each of the remaining quarters. The closing spot for March 31, 2008 from Kitco.com was 933 per oz so it the price as at June 30, 2008 is less than 933 which it probabably will be then these eps' are undervalued as a POG of less than 933 will have a positive impact on the P&L relating to the revaluation of the gold contracts.
If the actual eps is anything close to the above then I see "hot fun in the summertime"
GLTA