eik's stock talk

[eik]

About Aurus production numbers…

Jumping into discussion... uninvited as usual. :)

1. Facts:
- there are 423 gold producing companies in Russia. 40 of them produce more than 1000 kg of gold annually. The rest extract less than 100 kg average.
- all companies in Magadan region produce together about 16000 kg (16 ton) of gold per year (including ~ 5 ton from ore).
- total gold production of Yagodinskiy district in Magadan (Krong location) is 4000+ kg. Leader, Mayskaya, produces ~700 kg; 5 companies produce more than 200 kg; 7 companies – more than 100 kg.
- there are 24 gold producers in Yagonskiy district, their names are often mentioned in local press, especially artels with 100+ kg of annual production (about 10 of them) that are on the district’s “board of honor” and everyone is proud of them.
http://www.uralgold.ru/news/1540.htm
http://www.goldkolyma.ru/news.php?itemid=348&catid=2
http://primamedia.biz/show/?id=18276
http://www.goldkolyma.ru/news.php?itemid=325&catid=2

2. Opinions:
- Aurus statement from 10/30/2007 “Aurus Corp announces that the gold deliveries for year 2007 shall reach 2500Kgs, exceeding its expectation of yearly production by over 40%.” is not likely to be true (see statistics above).
- Looking at most recent financial statement: http://www.auruscorp.com/eng/Financial%20Aurus%20Corp.pdf
Revenue: 2007 – $38,866,772; 2008 - $36,143,692 (page 2).
To produce this kind of revenue the company should be selling about 40-45K ounces of gold per year, which is 1200-1400 kg. First, it’s kind of different from 2000-2500 kg claimed earlier for 2007. Second, even this “reduced” number puts Aurus into the list of 40 major Russian gold producers (as the only one "secret" producer though) and it’s more than annual production of famous Yagodinskiy leader "Mayskay". And “Mayskaya” name is all over Magadan public reports, but Krong/Aurus, which produces twice as much as "Mayskaya", is undiscovered and never mentioned. With reported levels of production… it’s more than strange.

FWIW.