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Golconda Gold Ltd V.GG

Alternate Symbol(s):  GGGOF

Golconda Gold Ltd. is a Canada-based un-hedged gold producer and explorer with mining operations and exploration tenements in South Africa and New Mexico. The Company operates through its wholly owned subsidiary, Galane Gold Mines Ltd., two assets: a producing gold mine which also has the rights to certain mineral exploration tenements (the mine and mineral exploration tenements collectively, the Galaxy Property) located in the Republic of South Africa (South Africa) through subsidiaries located in South Africa, and a gold and silver mine and processing infrastructure located in the United States of America (the Summit Property) that is in care and maintenance. The Galaxy gold is situated approximately eight kilometers (km) west of the town of Barberton and 45 km west of the provincial capital of Nelspruit in the Mpumalanga Province of South Africa. The property covers approximately 58.6 square kilometers (km2) is part of the prolific Barberton Greenstone Belt.


TSXV:GG - Post by User

Comment by Tadon Nov 05, 2020 11:22am
156 Views
Post# 31842143

RE:RE:Q3 Financial results

RE:RE:Q3 Financial results onetimer,

why do you say Nov18th, any source. Last quarter was released aug 7th , should be Monday if they follow pattern. 

im stocking up on Friday



I sent an email to the company on Monday, asking when the estimated date for Q3 financials was planned, and received a prompt response from Chairman Ravi Sood on Tuesday ..... November 18 is the date he stated.

Last year, the company issued Q3 2019 financials on Nov 25, 2019, so they're coming out a week earlier than the previous year.


Based on other companies' financial statements for Q3 already released, Galane probably sold their gold production at an average price of around $1910 - $1915 / oz in the third quarter. 
Eg. Calibre Mining average sales price in Q3 was US$1913 / oz. 


Can't recall is anyone has previously posted this, but Fundamental Research has a report for Galane Gold dated August 21, 2020 ...... gives Galane Gold a fair value of $0.66 / share using a US $1700 gold price ....... 

https://www.researchfrc.com/wp-content/uploads/2020/08/Galane-Aug-2020-Update.pdf

Not sure but you may have to sign up and get a free subscription to view the report .....

An excerpt on Page 7 from the report states : 

......"FRC’s Projections

Our gold price forecast for Q4-2020 is $1,925 per oz (unchanged). We expect prices to revert to our long-term forecast of $1,400 per oz by 2024. Our revenue forecast for GG in 2020 is $51 million (based on 30 Koz gold / previous forecast was $54 million), and for 2021 is $92 million (60 Koz at $1,700 per oz / unchanged). Our revised net profit estimate is $9 million / EPS: $0.04; previously $12 million / EPS: $0.05. We continue to expect 2020 to be the company’s first profitable year.

Valuation

Relative to senior gold producers, GG’s shares are trading at a significant discount on an Enterprise Value (“EV”) to resource ratio ($39 per oz versus the producers’ average of $272 per oz), EV to annual production ratio ($1,381 per oz versus the average of $7,605), and EV to 2020E Revenue ratio (1.5x versus 3.9x). Applying senior producers’ multiples, discounted by 50%, to GG, we arrived at a valuation of C$0.85 per share. A 75% discount returned a valuation of C$0.38 per share, which is 36% higher than GG’s current share price....." 



and on Page 9, Fundamental Research states : 

".....We reiterate our BUY rating and adjust our fair value estimate to C$0.66 per share ....." 



Let's see how well mg't executes on their development and ramp up of the Galaxy Mine over the next few months . Gold prices are currently about $250 an ounce higher than the $1700 used in the above referenced research report .... Galane continues to trade undervalued, would have to think that any effect of all the warrant exercise of the past few months should be over and done with by now. 




GLTA !
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