Source: Streetwise Reports
July 20, 2017 (Investorideas.com Newswire) Preliminary Q2 operating results show production up 94% and sales up 107%, a record for this company's Nevada and Canadian mines, news that was noted by a trio of industry analysts.
Klondex Mines Ltd. (KDX:TSX; KLDX:NYSE.MKT) released its second quarter operating results on July 18, reporting record production and sales. The company noted that it produced 66,629 gold equivalent ounces, a 94% increase from the first quarter, and sold 69,522 ounces, a 107% increase from Q1.
Mr. Paul Huet, Klondex's president and CEO stated, "As expected, the operating results for the second quarter were the best in the company's history. We processed all of the ore that was stockpiled at the Midas mill at the end of the first quarter plus we continued to execute our mine plans, mining an additional 53,248 gold equivalent ounces in the second quarter."
Analyst Heiko Ihle of Rodman & Renshaw noted in a July 19 company update that the large quarterly increase was "mainly due to a significant increase of production from Fire Creek, which we attribute primarily from the processing of stockpiled ore. . .the company plans on processing Hollister ore through the Midas mill in 2H17, and therefore remains on track to meet 2017 guidance. We highlight that our model estimates 2017 production to reach 219,000 gold equivalent ounces, in-line with management's 2017 production guidance."
Ihle also stated that at Fire Creek, production "totaled 45,773 gold equivalent ounces, a 138% increase over 1Q17 production. We note that 1Q17 production at Fire Creek was negatively impacted by heavy snowfall that limited the amount of mined ore the firm was able to transport to its Midas mill."
Rodman & Renshaw's report reiterated the firm's $6.25 per share target price. Klondex is currently trading at around $4.31.
Analyst Josh Wolfson of Eight Capital wrote in a July 19 report that "production results represent a material improvement from 1Q, and exceeded our expectations." He noted that "corporate production nearly doubles QoQ, aided by Fire Creek stockpile processing," which was 9% over Eight Capital's estimate. "Overall, production results represent a material improvement and near doubling from 1Q realized production of just 34.5 koz, which was largely impacted by ore transportation logistics issues due to weather at Fire Creek, as well as by equipment issues at True North," the report noted.
"While we believe ramp-up uncertainties remain at True North and Hollister, in our view 2Q results position the company favourably to achieve corporate full year production guidance," Wolfson stated.
Eight Capital's target price for Klondex is $5.25 per share.
PI Financial analyst Philip Ker, in a July 19 report, stated that "Klondex Mines provided a solid production beat for Q2/17 realizing 66,629 oz AuEq versus our target of 62,425 oz AuEq."
"In our view, achieving guidance is hinged on Klondex's two development assets Hollister and True North—both of which have achieved little to no production YTD. Hollister is in ramp-up mode with stockpiled ore. Both operations are anticipating increased tonnage output and head grades in the coming quarters in order to support their current guidance levels. Given the early stage of these operations, the ramp-up is a challenge but Klondex should still be able to adequately meet consolidated guidance of 210,000—225,000 oz AuEq."
PI Financial maintains a target price of $5.05 for Klondex.
Read what other experts are saying about:
1) Patrice Fusillo compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. She owns, or members of her immediate household or family own, securities of the following companies mentioned in this article: None. She is, or members of her immediate household or family are, paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are sponsors of Streetwise Reports: Klondex Mines Ltd. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.
This news is published on the Investorideas.com Newswire - a global digital news source for investors and business leaders
Disclaimer/Disclosure: Investorideas.com is a digital publisher of third party sourced news, articles and equity research as well as creates original content, including video, interviews and articles. Original content created by investorideas is protected by copyright laws other than syndication rights. Our site does not make recommendations for purchases or sale of stocks, services or products. Nothing on our sites should be construed as an offer or solicitation to buy or sell products or securities. All investment involves risk and possible loss of investment. This site is currently compensated for news publication and distribution, social media and marketing, content creation and more. Contact each company directly regarding content and press release questions. Disclosure is posted for each compensated news release, content published /created if required but otherwise the news was not compensated for and was published for the sole interest of our readers and followers. More disclaimer info: http://www.investorideas.com/About/Disclaimer.asp
Additional info regarding BC Residents and global Investors: Effective September 15 2008 - all BC investors should review all OTC and Pink sheet listed companies for adherence in new disclosure filings and filing appropriate documents with Sedar. Read for more info: http://www.bcsc.bc.ca/release.aspx?id=6894. Global investors must adhere to regulations of each country.