q2 numbersq2 production increased to 52,198 oz compared to 44,377 oz of last year.
the weakness in gcm share price may well have been people anticipating a large drop in cash balance for q2.
the large holders should already know this because it was clearly written months ago in the q1 mda "In April 2021, the Company paid the next income tax instalment of approximately $23 million. The final income tax instalment, also approximately $23 million, covering the balance of 2020’s income tax liability and required prepayments towards 2021’s obligation, is due before the end of the second quarter of 2021."
that is already $46 mil cash to pay taxes for q2, plus they used another $10 mil cash to pay down gold note debt in advance.
(the big tax payment just means they have big earnings. q2 earnings number would still be good regardless of cash balance. in the past they paid the previous year taxes in h1, but now they appear to be paying tax by installments in advance for current year too)
however this selling anticipating a large drop in cash balance could be another case of sell on rumor, buy on fact when the news reports it. after that news there can be anticipation again of the huge free cash coming from q3 (because long time holders know gcm pays most of their tax in h1 and gets huge free cash in h2). last year gcm share price shot up to $8 because of this huge free cash showing in the second half.
cfo already stated in a recent interview that they would have a large tax payment in q2 but would end the year with around $90-$100 mil in cash (with most of debt paid down).
if the market was anticipating bad news for gcm for q2, then after it happens they can start anticipating good news in the second half of huge free cash, additional cash from polymetalic plant, increase in capacity to 2000 tpd, toro updated pea with 4km high grade, and start of toro construction.