LSG Production News
Lake Shore Gold Reports Solid Production For Q3 And Shares Still Have Upside
Oct. 15, 2015 8:44 AM ET | About: Lake Shore Gold Corp (LSG), Includes: GDX, GLD
Disclosure: I am/we are long IAG, LSG. (More...)
Summary
Lake Shore Gold recently reported its Q3 and 9-month production results for 2015.
The company says it produced 40,600 gold ounces in Q3 and 136,200 gold ounces for the first 9 months of 2015.
More importantly, the company produced gold at all-in sustaining costs of $924 in the third quarter and $844 for the first 9 months.
Lake Shore is on-track to meets its full-year target on both production and cash costs, and with gold soaring Wednesday, shares look like they still have big upside.
Lake Shore Gold
(click to enlarge)
Lake Shore Gold (NYSEMKT:LSG) has rewarded shareholders with a 35.2% gain in 2015, compared to a 8.03% decline in the benchmark gold miners index (NYSEARCA:GDX), and a miniscule .14% gain in the price of gold (NYSEARCA:GLD). (Credit: Yahoo Finance)
Recent Stock Price: $.919
Shares Outstanding: 436.67 million
Market Cap: $401.559 million
52-Week Range: $.60 - $1.14
It looks like Lake Shore Gold has the wind at its back. The company just announced its Q3 2015 production results and cash costs, as well as results for the first 9 months of 2015. First, I'll give a brief overview of Lake Shore's assets, then discuss the results and why I feel shares are a buy here.
Lake Shore Gold is one of my favorite junior gold mining stocks. The company owns and operates the Timmins West Mine and the Bell Creek Mine and Mill in Northern Ontario, which produced a total of 142,200 ounces of gold in 2014, a 33% year-over-year increase.
(click to enlarge)
(Credit: Lake Shore Gold Corporate Presentation. In Q3 2012, AISC hit a high of $1,891 per ounce, but have since declined to under $9000 per ounce.)
In total, Lake Shore has produced 635,000 gold ounces since production began in 2011, and its deposits now hold 770,000 ounces of gold reserves, plus 2.96 million ounces of measured and indicated resources and 2.84 million ounces of inferred resources.
In the first quarter of 2015, Lake Shore reported record gold production of 53,000 ounces (19% increase) with revenue of $79.1 million and AISC of just $750, while the second quarter saw similar results. At current gold prices, this made Lake Shore quite profitable, with operating cash flow of $35.85 million in Q1 and $37.6 million in Q2. This rapid drop in cash costs also came at a time when gold prices fell from $1,700 to $1,150 per ounce.
(click to enlarge)
(Credit: Lake Shore Corporate Presentation)
As a result of the improved production and lower cash costs, Lake Shore was able to grow its cash and bullion position from $15 million in Q3 2013 to $84 million as of July 29, 2015. Meanwhile, the company's $60 million in senior secured debt has been fully repaid as of May 29, 2015, according to the company's corporate presentation.
(click to enlarge)
(Credit: Yahoo Finance)
This is why I think Lake Shore's stock price has crushed its peers over the past year or so. As you can see in the above chart, Lake Shore has easily outperformed its peers Primero Mining (NYSE
PP), Goldcorp (NYSE:GG), Iamgold (NYSE:IAG) and Kinross Gold (NYSE:KGC).
But Lake Shore is showing no signs of slowing down. As mentioned, the company just announced its operating results for the first 9 months of 2015. In Q3 2015, Lake Shore produced 40,600 ounces at AISC of $924 per ounce; for the first 9 months of 2015, Lake Shore has produced 136,200 ounces at AISC of $844 per ounce. This puts the company on track to meet its full-year guidance of 180,000 ounces and AISC guidance of $950 per ounce.
In addition, AISC was only higher in this quarter due to the impact of development work, according to the company. The company is aggressively exploring and developing its high-grade 144 Gap Zone deposit with six drills currently on site; Lake Shore plans on releasing an initial resource for the 144 Gap Zone in early 2016, and a positive release could be another catalyst for the share price. In addition, surface drilling has continued on the 144 Gap, 144 North and 144 South targets.
Investors should keep an eye out for Q3 financials, which should be released in late October. With 40,600 ounces produced at $924 AISC, and gold prices averaging $1,160 or so in the quarter, investors can expect strong operating cash flow and profits for the quarter.
In conclusion, Lake Shore Gold continues to deliver strong results for shareholders. The company reported strong production and cash costs for Q3 and for the first 9 months of 2015, but I think the best is yet to come, especially since the gold price is starting to show signs of life. Gold bulls should consider buying Lake Shore here in my view.
Editor's Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.
Lake Shore Gold Reports Solid Production For Q3 And Shares Still Have Upside
Oct. 15, 2015 8:44 AM ET | About: Lake Shore Gold Corp (LSG), Includes: GDX, GLD
Disclosure: I am/we are long IAG, LSG. (More...)
Summary
Lake Shore Gold recently reported its Q3 and 9-month production results for 2015.
The company says it produced 40,600 gold ounces in Q3 and 136,200 gold ounces for the first 9 months of 2015.
More importantly, the company produced gold at all-in sustaining costs of $924 in the third quarter and $844 for the first 9 months.
Lake Shore is on-track to meets its full-year target on both production and cash costs, and with gold soaring Wednesday, shares look like they still have big upside.
Lake Shore Gold
(click to enlarge)
Lake Shore Gold (NYSEMKT:LSG) has rewarded shareholders with a 35.2% gain in 2015, compared to a 8.03% decline in the benchmark gold miners index (NYSEARCA:GDX), and a miniscule .14% gain in the price of gold (NYSEARCA:GLD). (Credit: Yahoo Finance)
Recent Stock Price: $.919
Shares Outstanding: 436.67 million
Market Cap: $401.559 million
52-Week Range: $.60 - $1.14
It looks like Lake Shore Gold has the wind at its back. The company just announced its Q3 2015 production results and cash costs, as well as results for the first 9 months of 2015. First, I'll give a brief overview of Lake Shore's assets, then discuss the results and why I feel shares are a buy here.
Lake Shore Gold is one of my favorite junior gold mining stocks. The company owns and operates the Timmins West Mine and the Bell Creek Mine and Mill in Northern Ontario, which produced a total of 142,200 ounces of gold in 2014, a 33% year-over-year increase.
(click to enlarge)
(Credit: Lake Shore Gold Corporate Presentation. In Q3 2012, AISC hit a high of $1,891 per ounce, but have since declined to under $9000 per ounce.)
In total, Lake Shore has produced 635,000 gold ounces since production began in 2011, and its deposits now hold 770,000 ounces of gold reserves, plus 2.96 million ounces of measured and indicated resources and 2.84 million ounces of inferred resources.
In the first quarter of 2015, Lake Shore reported record gold production of 53,000 ounces (19% increase) with revenue of $79.1 million and AISC of just $750, while the second quarter saw similar results. At current gold prices, this made Lake Shore quite profitable, with operating cash flow of $35.85 million in Q1 and $37.6 million in Q2. This rapid drop in cash costs also came at a time when gold prices fell from $1,700 to $1,150 per ounce.
(click to enlarge)
(Credit: Lake Shore Corporate Presentation)
As a result of the improved production and lower cash costs, Lake Shore was able to grow its cash and bullion position from $15 million in Q3 2013 to $84 million as of July 29, 2015. Meanwhile, the company's $60 million in senior secured debt has been fully repaid as of May 29, 2015, according to the company's corporate presentation.
(click to enlarge)
(Credit: Yahoo Finance)
This is why I think Lake Shore's stock price has crushed its peers over the past year or so. As you can see in the above chart, Lake Shore has easily outperformed its peers Primero Mining (NYSE
PP), Goldcorp (NYSE:GG), Iamgold (NYSE:IAG) and Kinross Gold (NYSE:KGC). But Lake Shore is showing no signs of slowing down. As mentioned, the company just announced its operating results for the first 9 months of 2015. In Q3 2015, Lake Shore produced 40,600 ounces at AISC of $924 per ounce; for the first 9 months of 2015, Lake Shore has produced 136,200 ounces at AISC of $844 per ounce. This puts the company on track to meet its full-year guidance of 180,000 ounces and AISC guidance of $950 per ounce.
In addition, AISC was only higher in this quarter due to the impact of development work, according to the company. The company is aggressively exploring and developing its high-grade 144 Gap Zone deposit with six drills currently on site; Lake Shore plans on releasing an initial resource for the 144 Gap Zone in early 2016, and a positive release could be another catalyst for the share price. In addition, surface drilling has continued on the 144 Gap, 144 North and 144 South targets.
Investors should keep an eye out for Q3 financials, which should be released in late October. With 40,600 ounces produced at $924 AISC, and gold prices averaging $1,160 or so in the quarter, investors can expect strong operating cash flow and profits for the quarter.
In conclusion, Lake Shore Gold continues to deliver strong results for shareholders. The company reported strong production and cash costs for Q3 and for the first 9 months of 2015, but I think the best is yet to come, especially since the gold price is starting to show signs of life. Gold bulls should consider buying Lake Shore here in my view.
Editor's Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.
