Cara Community GSM: Wesdome Gold 12-2020

Wesdome Gold (WDO.TO) (OTC: WDOFF) reviewed 12-12-2020

Market Cap:       $1.41 Billion (USD)          Share Price:        $8.00

Shares outstanding: 142,969,000 (FD)

Cash on hand:    $73.5 M (CAD) as of 30 Sept 2020.

Long-Term Debt: Nil.  Total Liabilities: $99.0 M (CAD).

Current operations: Yes: 3 properties in Tier-1 jurisdictions Ontario and Quebec.

  • The Eagle River Complex (2 mines at Wawa Ontario) is the production asset with 2020 guidance at 90,000-100,000 oz Au at AISC of between US$985-1040/oz
  • The Kiena Project (Val-d’Or Quebec) is their primary growth asset believed to be able to produce ~86,000 oz Au/per year at low US$512 AISC).
  • The Moss Lake Project is a 3.0 million oz indicated and inferred resource at 1.1 g/ton.

Insiders: Low                      Institutional: 100 own approx. 50% of the float.


CEO: Duncan Middlemiss              HQs: Toronto, Canada.

Q3 highlights:

  • Wesdome produced 20,008 oz gold in Q3, 70,272 oz year-to-date.
  • Earnings of $14.6 Million (CAD) or $0.10 cents per share (GAAP) on Revenue of $55.0 Million.
  • Operating cash flow of $25.5 Million (CAD). Free cash flow was $3.2 Million (CAD).
  • Production guidance remains 90,000-100,000 oz gold for 2020.
  • AISC $1047 (USD) per gold ounce for the quarter.

Bottom line:

  • A relatively small but profitable Gold producer that has long been viewed as a take-over candidate. Have personally held the stock in recent years (no position presently) while anticipating a buy-out.
  • The company offers stable and growing revenues and has a sound balance sheet with no debt. Operations generate ~$60 million in annual free cash flow at $1800 gold.
  • Small reserves (550,000 oz Au), but good resources (possibly a total of 5 million oz Au).

Wesdome Gold stock chart for WDO on Toronto at $10.20 CAD (cannot find WDOFF chart at $8.00 USD)

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