All are big positive, no single negative from the Q2 earning itself.
Lets analyze it page by page, line by line.
1 Income/loss: BAA reported $0.01 loss per share on page 4 of earnings, produced 21,431 oz gold but sold only 20,537 oz on page 4 of MD&A, so $1M+ money did not enter into the income, plus $482K one-time legal fee against Liberty attack on page 11 of MD&A. If adding these two money back to earnings BAA will be $0.00 loss per share. But estimate from analyst is $0.03-0.05 loss per share. So BAA beats the estimate hard. At fair market, BAA should double, instead decrease 17% with the earning release. Now the question is why the market is so unfair? The answer is simple, someone needs shares badly!
conclusion: BAA management is much better than analyst expected.
2 All-in sustaining cost per ounce by production: $893 for Q2 2014, $1,086 for Q2 2013, $1,035 for Q1 2014 on page 4 of MD&A. That is a 16% improvement against Q1 2014, a 22% improvement against Q2 2013. We will expect further improvement when production continues increasing and wet weather protection applied.
Conclusion: BAA controls production expense very well and BAA mine is one of the lowest cost mines in the world.
3 Cash flow: Q2 2014 cash on hand is $6.46 M on page 3 of earnings while Q1 2014 is $17.4 M, a $11 M decrease for this Q. But BAA used 1.776 M cash for exploration and evaluation, $15.725 M for the development of the Namoya mine, $4,266 M for capital assets on page 14 of MD&A. So, total cash used about $22M. That means BAA used $11M cash from the leftover of Q1 2014 and $11M cash from the cash flow of Q2 2014.
Now you can see BAA cash flow can not only covers its operation, but also has $11M per Q, $44M per year for its exploration and evaluation, development and capital assets. So, if BAA does not want to be aggressive it can fix everything itself slowly.
Conclusion: BAA can survive and develop without any finance aid.
The above are facts, nobody can deny. If somebody wants to debate I will be very happy to join the debate.
AI
