DNG - Modelling - Gold Price/Ore Margin Kiniki I agree with you. "DNG's low risk business model is a safe place to be invested during gold price fluctuations".
After the 2012 financial statements were published I also did a little modelling and plugged in different gold prices and ore margins. Results are below. It shows that DNG would have been profitable at a $1000 gold price. Can you image a $7,000 gold price which is coming as per Jim Willie interview (Must Watch):
https://www.youtube.com/watch?v=LSjpbWdZzYQ
DNG - Modelling - Based on Actual 2012 Financial Statement
|
2012 Parameters Changed: Gold Price $1636.37; Ore Margin 68.75%
|
|
|
|
|
|
|
|
|
|
|
|
|
2012
|
Oz Gold Eq
|
Ave Gold Pr
|
Paid To Miner
|
% To Miner
|
|
Gold Sales
|
|
100,267,180
|
61274
|
1,636.37
|
1,124.95
|
68.75%
|
|
Silver Sales
|
|
4,726,982
|
2,888.69
|
1,636.37
|
Retained DNG
|
% To DNG
|
|
Total Sales
|
|
104,994,162
|
64,162.69
|
1,636.37
|
511.43
|
31.3%
|
|
|
|
|
|
|
|
|
Cost of Sales Detail:
|
|
% of Sales
|
% of Margin
|
% Cost of Sales
|
Assume Costs
|
|
Ore
|
|
72,179,511
|
68.75%
|
14.1%
|
82.8%
|
Variable
|
|
Production Supplies
|
5,423,871
|
5.2%
|
1.1%
|
6.2%
|
Variable
|
|
Salaries,Benefits and Other Employee Expenses
|
3,331,859
|
3.2%
|
0.6%
|
3.8%
|
Variable
|
|
Transportation
|
|
4,157,332
|
4.0%
|
0.8%
|
4.8%
|
Variable
|
|
Other Production Costs
|
1,776,478
|
1.7%
|
0.3%
|
2.0%
|
Variable
|
|
Peruvian profit sharing expenses
|
959,728
|
0.9%
|
0.2%
|
1.1%
|
Variable
|
|
Depriciation of property, plant & Equipment
|
1,290,749
|
1.2%
|
0.3%
|
1.5%
|
Variable
|
|
Variation of Finished Goods Inventory
|
(1,614,735)
|
-1.5%
|
-0.3%
|
-1.9%
|
Variable
|
|
Variation of Gold in Process Inventory
|
(356,346)
|
-0.3%
|
-0.1%
|
-0.4%
|
Variable
|
|
|
|
|
|
|
|
|
Cost of Sales
|
|
87,148,447
|
83.0%
|
17.0%
|
100.0%
|
|
|
|
|
|
|
|
|
|
Gross Margin
|
|
17,845,715
|
17.0%
|
|
|
|
|
Other Income/Expenses
|
5,421,936
|
|
|
|
|
|
Income Before Taxes
|
12,423,779
|
|
|
|
|
|
Taxes (37.89%)
|
|
4,707,882
|
|
|
|
|
|
Net Income
|
|
7,715,897
|
|
|
|
|
|
2012 Actual -Net Income
|
7,715,897
|
|
|
|
|
|
Difference:
|
|
-
|
|
|
|
|
|
Shares: 37,458,023
|
37,458,023
|
|
|
|
|
|
Earning Per Share:
|
0.21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DNG - Gold Price Change Modelling - Ore Margin Constant: 68.75%:
|
|
|
|
|
2012
|
% Gold Price
|
DNG
|
Change from
|
$ Gold Price
|
$ Gold Price
|
|
|
Gold Price
|
Paid Miner (Ore)
|
Net Income
|
2012 DNG Income
|
Paid Miner (Ore)
|
Retained DNG
|
|
|
975.00
|
68.75%
|
-
|
(7,715,897)
|
670.28
|
304.72
|
|
|
1,000.00
|
68.75%
|
32,293
|
(7,683,604)
|
687.46
|
312.54
|
|
|
1,100.00
|
68.75%
|
1,248,579
|
(6,467,318)
|
756.21
|
343.79
|
|
|
1,200.00
|
68.75%
|
2,462,741
|
(5,253,156)
|
824.95
|
375.05
|
|
|
1,300.00
|
68.75%
|
3,673,961
|
(4,041,936)
|
893.70
|
406.30
|
|
|
1,400.00
|
68.75%
|
4,881,424
|
(2,834,473)
|
962.45
|
437.55
|
|
|
1,500.00
|
68.75%
|
6,084,314
|
(1,631,583)
|
1,031.19
|
468.81
|
|
|
1,636.37
|
68.75%
|
7,715,897
|
-
|
1,124.95
|
511.43
|
|
|
1,700.00
|
68.75%
|
8,498,122
|
782,225
|
1,168.69
|
531.31
|
|
|
1,800.00
|
68.75%
|
9,729,497
|
2,013,600
|
1,237.43
|
562.57
|
|
|
1,900.00
|
68.75%
|
10,963,274
|
3,247,377
|
1,306.18
|
593.82
|
|
|
2,000.00
|
68.75%
|
12,199,452
|
4,483,555
|
1,374.92
|
625.08
|
|
|
2,500.00
|
68.75%
|
18,416,357
|
10,700,460
|
1,718.66
|
781.34
|
|
|
3,000.00
|
68.75%
|
24,693,291
|
16,977,394
|
2,062.39
|
937.61
|
|
|
|
|
|
|
|
|
|
DNG - Ore Margin Change Modelling - Gold Price Constant: $1636.37
|
|
|
|
|
2012
|
% Gold Price
|
DNG
|
Change from 2012
|
Gross
|
$ Gold Price
|
$ Gold Price
|
|
Gold Price
|
Paid Miner (Ore)
|
Net Income
|
DNG Income
|
Margin
|
Paid Miner (Ore)
|
Retained DNG
|
|
1,636.37
|
68.75%
|
7,715,897
|
-
|
17.0%
|
1,124.95
|
511.43
|
|
1,636.37
|
68.25%
|
8,039,466
|
323,569
|
17.5%
|
1,116.83
|
519.55
|
|
1,636.37
|
67.75%
|
8,365,504
|
649,607
|
18.0%
|
1,108.64
|
527.73
|
|
1,636.37
|
67.25%
|
8,691,541
|
975,644
|
18.5%
|
1,100.46
|
535.91
|
|
1,636.37
|
66.75%
|
9,017,579
|
1,301,682
|
19.0%
|
1,092.28
|
544.09
|
|
1,636.37
|
66.25%
|
9,343,617
|
1,627,720
|
19.5%
|
1,084.10
|
552.28
|
|
1,636.37
|
65.75%
|
9,669,654
|
1,953,757
|
20.0%
|
1,075.92
|
560.46
|
|
1,636.37
|
65.25%
|
9,995,692
|
2,279,795
|
20.5%
|
1,067.73
|
568.64
|