RE: REPORT from Rory QuinnVery nice post. Thanks.
I just went through the financials and would like to add following comments:
As mentioned, there were many negative factors in play in Q2 compared to Q1. They actually moved less ounces to the pads even though the total tonnage was increased. Still they managed to make better mine profit from Castillo because mining costs per tonne went sligthly down, Castillo D&A decreased. And in Q1 they sold less than they produced (Q1 would have been better actually)
Total mine profit increased by 0.6 m, only because of El Sastre they sold double the ounces in Q2 than Q1.
Estimate for Q3: Tonnes moved 2.4m, strip ratio 1.45, gold price 920/oz, cost per oz from Castillo $597 based on 1.16/t mining and 1.93/t milling+ transportation & royalties. Just like in Q2. It would go higher because of even larger strip ration and lower grade. However, there are probably efficiencies found that lower cost /oz. Despite of costs, increased tonnage compared to Q2 would produce about one million more mine profit ($3.5m). This assumes that El Sastre goes as in Q2. After G&A etc, net profit could be in order of $1.4 million. (Althought they said M&A costs will go down from now on)
So probably not much happening until 2010.