Post by
nozzpack on Apr 13, 2023 7:29am
Lowest Breakeven Cost Among Gold Producers
There is only one real and accurate Breakeven cash cost for gold producers.
That is the Total Production Cost.
Neither cash cost nor AISC.....despite its name...fully describe total production costs.
Majestic is rare in that it does publish all three cash cost indices .
I have checked its Total Production Cost independently checking its net cash flows.
It corroborates that in Q3 of 2022, its Total Production Cost ( TPC) was $726 US per ounce .
All cash flow profits above that level went to the net cash position.
Even better, the trend in TPC was downward.
Its interesting to note that the average AISC for gold producers in 2022 was $1279 US per ounce .
AISC, mind you, not TPC, so the average Breakeven price was above $1279 per ounce .
Basically, Majestic's Breakeven cost is about 1/2 of the World average .
My search is not exhaustive but I could find no other gold producer below $900 US.
At $2000 US gold price , Majestic will be throwing off about $1250 USD per ounce in Free cash flow ....basically, $100 million CAD per year in free cash flow @50,000 ounces per year which is about $0.095 per share , with $70 million CAD in cash already on our balance sheet.
This raises the real possibility that Majestic could have $170 million in cash at exit 2023 at $2000 POG.
Thats $0.165 per share in CAD..
Comment by
richard45161 on Apr 13, 2023 10:17am
HI nozzpack, thank you for the good work. I was checking productions costs, net earnings, P/E ratios and marcet cap of serveral other junior/senior gold producers and know how difficult it is to get an overview. best richard
Comment by
Value2020 on Apr 13, 2023 3:11pm
I have been singing this tune for the past couple of years. Gold price has helped the bull case. Only a matter of time....