RE:HedgingAISC was around $1200 for Q1 .... with about 53,000 oz production. We'll be seeing Q2 production results next week. I expect a slight increase over Q1 number. Based on 220,000 - 235,000 oz guidance for 2022,, Calibre should be producing 60,000 to 65,000 oz per quarter in the second half of 2022.
So the AISC should drop in Q3 and Q4 as well, as mine sequencing starts pushing higher grade ore through the mills in Nicaragua, and Nevada. Calibre has already budgetted for $100 oil prices and oil appears to have stabilized near $100, at least for now. Unknown are steel and chemical prices . I believe theccompany had negotiated a long term contract for electricity supply last year.
Q2 average gold price was around $1850, so using Q1 AISC $1200 as a guide, CXB should have had about $650 per ounce free cash flow for Q2. Perhaps a slight increase to 55,000 ounces production would see almost US$36 million free cash flow in Q2.
The company is spending alot of money in good times to increase known reserves and resources. If gold prices drop significantly below $1700, the company could cut back on exploration expenses, in 2023 ..... but why risk upside in gold price by selling forward some production ?
With the growing cash balance every quarter, and zero debt, CXB has no need to hedge.
It would not surprise me at all seeing Calibre with US$100 - $110 million cash in the bank by year end 2022, if they don't pull the trigger on another acquisition beforehand.
GLTA !