Why the new gold stock is shining today
Actions of New Gold (NYSEMKT: NGD) had jumped about 10% by 2:30 p.m. EST Friday. Drive the gold mining stocksThe rally is its third quarter results.
New Gold produced 105,628 ounces of gold equivalent during the third quarter. While that number is down year-over-year due to some challenges during the quarter, the company remained on track to meet its updated annual forecast range of 405,000 to 450,000 ounces of gold equivalent.
A more impressive metric was the company’s all-inclusive sustaining costs (AISC), which fell 9% in the quarter from the first half of the year, to $ 1,408 per ounce of gold equivalent. . The determining factor was a 16% drop in AISC at its Rainy River mine in Ontario. With an average gold price of $ 1,788 an ounce during the quarter, New Gold made money. Overall, it generated $ 54 million in operating cash during the quarter. He also ended the period with a strong financial position, including $ 151 million in cash and $ 477 million in total cash.
New Gold has also had some positive things to say about what lies ahead. The gold company has indicated that it expects production at Rainy River to improve in the fourth quarter. It also plans to meet its cost target for the year as a whole. Meanwhile, the company also said it is moving forward with ramping up projects at its New Afton mine in British Columbia and continuing to work on an optimized underground mine plan study at Rainy River.
New Gold overcame some production challenges in the third quarter. It was able to reduce costs, improving the profitability of its Rainy River mine. Cost reduction remains an important goal as it always has higher costs than most other gold producers.
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