Buscar Company (CGLD)

[cl]

Here's my #'s

I've had to work these out three times, because of new info.

Basic facts:

Interest rates on the $12.5 mil loan are LIBOR + 4% = 8.35% = $1,0440,000/year (rounded.)

Hedging costs are $35/oz/Au for 32,000 oz/year = $1,120,000/year. When they pay this to the bank, then they can sell all the production at spot.

The video on the website says they are "producing Au at the rate of 50K/oz/year now."

Ag production is .726 X Au production - from recent company release. So that would be 36,300 oz/silver/year.

Cash costs for Au are $280/oz. This includes labor and all other costs at the mine site.

I'm putting the interest charges into "other overhead", which includes management salaries, office lease, utilities, insurance, legal, accounting, advertising, travel, and asst. I estimate that total at $4,000,000/year.

I'm using $700 for Au and $13 for Ag sales prices. #'s will be easy to rework for higher selling prices.

Receipts:

50K/oz Au = $35 mil
36.3K/oz Ag = $472K (rounded)

Total receipts = $35,472,000

Expenses:

Cash costs = $14,000,000
Hedging = $1,120,000
Other overhead = $4,000,000

Total expenses = $19,120,000

Net profit = $16,352,000 divided by 192,528,688 F D shares
= 8 cents to the bottom line.

Pick your P/E - should be at least 20 for a growing operation, gives $1.60 stock price. If the PM's continue to run higher, P/E's of the miners will rise, along with net profits.

Feel free to point out mistakes/ommisions.

C L