RE:new mine
Management confirmed that the bullion was sold as at the time of the last conf. call. Should have produced ITRO $40m of cash at that time.
As at the end of Q1, the hedges showed as an over $60m LIABILITY on the balance sheet. That liablility will have reduced at current gold prices, strengthening the balance sheet considerably.
Superficially, the $200m of long-term debt is a worry, were gold prices to stay low for an extended period. With such low prices, however, I'm sure management will put the company into "survival mode". I.E. maximise cash generation and minimise expenditure. If that were done, I have little doubt that costs could be lowered substantially, keeping the balance sheet strong, at the expense of future production.
Other miners will doubtless do likewise (the ones that survive, anyway!), which will lead to falling mine supply into the market. Seems likely to me that eventually a recovery in the PoG will occur, once ETF selling finishes and mine supplies are constrained.
Could mean a lower share price to come, esp. if the co. has to take writedowns on past acquistions. I stand ready to add if the mood darkens considerably further. Got plenty more cash on the sidelines, if necessary.
Cheers,
Mark