A few things to note (and I have not gone through the financials with a fine tooth comb, yet):
They are slightly below their forecasts as represented in their May 2012 presentation (4900 oz produced vs. what looks to be slightly above 5000 oz for the quarter - if I am not mistaken - haven't looked in months). Not a big disparity for me considering the company is still milling 'waste' in order to get to the high-grade zone and has yet to process the ore that is part of the Preliminary Economic Assessment.
Regarding the insinuation of "Mistakes" or "gold price per oz" - see the press release. Perhaps a repatriation of money owed to majestic for the sale of Sawayaerdun way back when... " plus ????...
Other revenue, including adjustments forsmelting fees 1,641,790
-I like the fact that the mill looks to be repaid in full - see Balance Sheet
-I like the cash position and security they have with $24m in cash.
-I like the fact that they are positioning 2012 FY to be a "clean-up" year so 2013 FY they can hit the higher grades and really graduate to a decent size producer
-I look forward to the final removal of "waste" so cash cost per oz can come down significantly for FY2013, resulting in better operating and bottom line profit.
-I like the fact that they ARE stockpiling gold concentrate during times where the spot price of gold is lower (April - June was not the best selling timeframe). This shows they are willing to be patient with sales, to optimize revenue by selling at opportune times.
-I am not thinking or investing for today, or 2012 for my investment, I am thinking of FY2013 - where they should reflect substantial increases in revenue, and where they will become a hot commodity (no pun intended) due to gold produced and the company seemingly coming from nowhere to the mainstream investing community.
-I don't like managements inability to showcase the company and increase the share price, use real market wires, communicate a plan to shareholders publicly, maintain a functional and professional website (Built by a 13 year old?).
-I don't like managements attitude to shareholders but love the property. This is, no doubt, a long term investment - longer than originally anticipated, but that is the life of a start up producer and getting in at the absolute bottom. Not many companies make it to this point, so I'll continue to be patient with this investment (not trade).
-All in all, these results are what I expected, and I am more interested in Q1 of FY2013 - so an end of Feb 2013 release, but I EXPECT MUCH MORE FROM MANAGEMENT for FY2013 (they have to - perhaps some CEO lessons can be had between now and then).
More from the PR:
- 133-per-cent increase in gold production:
- The joint venture produced 4,891 ounces of gold and sold 3,215 ounces of gold during third-quarter 2012, compared with gold produced of 2,099 ounces and 1,893 ounces sold during third-quarter 2011.
- 162-per-cent increase in revenues:
- Third-quarter 2012 joint venture revenues were $6.8-million, compared with $2.6 million in third-quarter 2011.
- Gross joint venture profit from operations was $1.7-million in third-quarter 2012, compared with $700,000 in third-quarter 2011.
- Majestic's share of joint venture operating profit during third-quarter 2012 was $600,000, compared with $200,000 in third-quarter 2011. Majestic effectively owns 94 per cent of 75 per cent, or 70.5 per cent, of operating profit.
- Increased joint venture revenues and profits are a result of increased throughput of ore following the commissioning of the 6,000-tonne-per-day mill in May, 2011.
- The joint venture has 4,055 ounces of gold in inventory valued at cost according to international financial reporting standards at $3,743,919 against an estimated market value of $6,758,063 (based on spot close of $l,666.60 per ounce on Aug. 28, 2012).
- 143-per-cent increase in gross profit:
- 200-per-cent increase in quarterly operating profit:
- Increased milling capacity:
- $6.76-million of estimated gold inventory:
- 225-per-cent increase in gold production:
- The joint venture produced 14,237 ounces of gold and sold 10,403 ounces during the nine months ended June 30, 2012, compared with producing 4,384 ounces and selling 4,015 ounces during the nine months ended June 30, 2011.
- 240-per-cent increase in revenues:
- Joint venture revenues for the nine months ended June 30, 2012, were $19.4-million, compared with $5.7-million for the nine months ended June 30, 2011.
- Gross joint venture profit for the nine months ended June 30, 2012, was $7.87-million, compared with $1.66-million for the nine months ended June 30, 2011.
- Majestic's share of the operating profit for the nine months ended June 30, 2012, was $2.9-million, compared with a $400,000 loss for the same period in 2011, representing a shift from operating loss to profit.
- Cash cost per ounce of $806 for the nine months ended June 30, 2012, decreased significantly from $995 during the nine months ended June 30, 2011, due to a contract renegotiation for a lower mining and processing rate and efficiencies experienced through the commissioning of the new 6,000-tonne-per-day mill.
- 374-per-cent increase in gross profit:
- Shift to cash-plow-positive operations:
- 19-per-cent reduction in cash costs per ounce: