Member Info for TheOracleofOmaha

Its not the 5-10% 2024 increase in cost, or even the 20% increase predicted 2025 costs. Its that fact that as of 3months ago we're "on track" to meet guidance.

They didn't give satisfactory answers explaining the sudden change, its not like it was q1. They had 3 quarters finished and should have known the costs.

The explanation of the Argentina peso not devaluing and a mara rosa contractor delaying ramp up, doesnt explain a 5-10% (20-40% for q4) hike in costs for the entire year.

I was tired when listening to the call so will relisten again but didn't seem to get a clear answer as to why inmaculada 2025 cost guidance was up 20%, something along the lines of, with the price of gold up local commitments are up. (Didnt like the sound of that).

The analysts did seem to push for price guidance beyond 2025 which they didn't seem to really answer. Bare in mind as of october, the 2026 aisc guidance was $1100-1200. I find it very hard to believe we would go from a 2025 aisc of $1640 back down to $1150.

Disappointed in Eduardo Landin tbh. Its a significant cost change in such a very short period of time and hasnt been well explained. I imagine the analysts all went a way clueless as to what costs to expect for inmaculada and mara rosa over the long term.

That said we are producing a lot of gold and silver with two large mines potentially up and running in next 2-3yrs. If your bullish or atleast not bearish on gold and silver Hoc should be very profitable. Its just a shame that poor management leaves such doubt over costs.

Really hope we get a good explanation for 2025 costs, only positive spin i can think of is one off capex 2025 for inmac similar to 2024 due to deferral of investment till they got the 20yr permit and then a reformation of the prior $1100-1200 aisc 2026 expectation. But very much doubt we will get that :(

Anyway congrats on 600k shares thats a fantastic position.

I dont think anyone is suggesting a 15% share price decline, relative to the news, is unreasonable.

That said if you're of the belief that just over 13months from now, its probable that a £200m profit will be published, then a £1b valuation surely is below fair value given the 10yr treasury is only returning you 4.5%.

They sell slightly below spot but not that much. Only have to look at the spot price for Gold over 2024 for the below to look off.

2024 average $2,345

q4 average $2,464

Sotolo i was just typing a very similar message. I'm with you. Also "due to slower than expected ramp up" at mara rosa. How does this explain an increase in 2025 expected aisc for mara rosa given its currently producing at a higher output than ever projected?

The only indication I've heard from the board is from the call they had with retail investors where Ladin said something along the lines of with gold and silver up so much a lot of the suppliers want a piece of the action with higher prices.

potentially they are sandbagging their expected cost. 10% higher costs due to the reasons given in 2024 isnt moving the needle much. However, a 3 yr time span of costs falling significantly vrs a 3yr time span with costs increasing is moving the needle. I'm very interested to see their cost projections up to 2027 as the reasons they have given can only really apply to 2024 (mara rosa exceeding 100k and argentina inflation is falling rapidly)

Good production numbers from San Jose and Mara rosa (now producing at a rate in excess of 100k), Inmac falling short of q3 numbers. Worst of all is costs. Just 4months ago they had a 2025 aisc at 1300-1400 for 2025, now 1587-1687 (20.5% to 22% increase)

Inmac : gold around 38.5k and silver 1.75m

San jose: gold 15k silver 1m silver

Mara rosa: 25k gold

Hoping the trend of inmaculada outperforming what i imagine are their "sandbagged" expectations. Even if q3 numbers are repeated it reaffirms how undervalued hoc is.

Yeah, fair enough. gold will most likely trade down on the odd day were some folks look for liquidity.

i personally think, just about all major govs & central banks currently are very trigger happy to stop any meaningful liquidity crisis. I'm guessing the frothiest parts of the market aren't large holders of pm's (big 7,crypto,ect.) so i could imagine a large drop off in the s&p with gold rising.

imo could be wrong ;)

"and is now quite highly valued compared to others in the sector is what am trying to say." Respectfully, this only makes sense to me if 1. You think hoc specifically has a very large political risk or 2. You think gold and silver will drop significantly and stay there, which would make all miners overpriced but hoc being a relatively high cost miner will be more so than others.

If its not either of those 2 assumptions pls share your numbers, thks.

Sotolo below data from cpm group show very weak correlation between gold and stock market. Over last 50 yrs.

https://youtu.be/tIAu3Z9qgtQ?t=10m21s

10:22

Usually, but not always, the PE ratios falling sharply in a market crash/bear market is due to fear that future earnings have previously been to optimistic. In a case were markets follow economic data lower but where gold& silver rise, you would expect miners to rise with it.

*rather than the deflationary side

Gold has in the past been sold off during "market crashes" for all sort of reasons but I'd imagine mainly for liquidity. If markets fall off due to geopolitical problems gold would likely rise.

I think nowadays especially in last 15yrs most of the major countries respond to any meaningful liquidity crises with rapid help. I think their belief is better too much, too quickly. Than not enough too late.

If they're all aiming for optimal monetary and fiscal policy all failing will be on the inflationary side rather than inflationary side

Hope you survive 2025 then your wife will have a multimillion pot just from your hoc position 😉

Ok here goes, reasons as to why gold and silver will likely rise:

1 geopolitical deterioration.

China south china sea & taiwan (trump more likely to retaliate with sanctions than military compared with most administrations, increasing ccp's likelihood of acting out.)

Middle east tensions are very high even for middle eastern standards

Many elections throughout 2024 with surprising/protest vote wins. History says popularist are more volatile leaders.

2. Global recession - economic data has been showing signs of softening, especially in china

3. Market volatility - the average joe is more likely to be active in the stock market pre covid than before.

4. Persistent inflation. With most major countries with large budget deficits and significantly increasing debt servicing costs, any hawkish monetary or fiscal action is likely to be very limited.

5 defaults in commercial real estate - china has a massive problem in residential real estate but most of the west imo has a problem with commercial real estate, particularly small US banks.

6. Trump. Can't rule out a tariff war. Can't rule out mass deportations. Can't rule out increased civil unrest.

7 deglobalisation - with more tensions and less trust between nations, along with tariffs, US reluctance to police the world, inflationary policy and threat of sanctions. International trade has challenges and central banks are more attracted to gold as reserves.

8... and finally not just for 2025 but longer term, imo we are at the peak of the long-term debt cycle and in a world where fiat currencies are truly dominant the deleveraging will most certainly be an inflationary one.

i wish i had 590k shares. congrats man. its bat **** crazy to hold such a large position for sentimental reasons.

$3b at an average gold price of $3000 isnt unreasonable.

You're missing 60k hedge between 2000-2400 for peru. That is the last hedge for peru and your right after that all there is, is 50k hedged till 2027.

Over the next 3 years the hedge will likely cost about $100m- $150m. Obviously we all hope it will cost us a lot more.

2024 has had mara rosa ramp up. Increased costs at inmaculada due to last years late permit and a large change in gold & silver prices. The p&l for 2024 is a screenshot of productivity in 2024. The second half of the year will be significantly more profitable than the first.

Projecting 2025 productivity and then the potential for 2027 productivity (given royropata and monte go as planned) and its very hard to justify the current market cap as anything but significantly undervalued. 2025 -2027 is hardly long term, the only explanation I can imagine is the market doesnt beleive gold and silver prices will hold up.

CPM group, who have a good and very long track record. Let slip on an interview uploaded today that they are expecting a $36 to $38 annual average net price for silver over the next two years. Jeffrey also said given a likely $36-38 average price the chances silver spikes to intra-day prices above $50 at points during the next two years are is almost 100%.

He very rarely concisely gives out price targets publically, usually have to read between the lines with him.

Oooorrrrr its sp has reacted to today's price decline in the two resources it mines.

Could well fluctuate back up 5% tomorrow. Down on monday and up by end of the week is hardly unheard off with hoc

Bull case would be because I want to lock in the current capital gains rate and only the largest of businesses are worth my time, hence I haven't managed to redeploy the cash.

Bear case would be I think the market is significantly overvalued and I'm positioning myself similar to how I did in 2006/2007

I personally think its the latter. I worship the guy but I dont think he believes he has a sixth sense as to when a market will top. I think when he cant find anything good at a fair price he lets cash build up and when what he holds surpasses a fair price he sells.

https://youtu.be/2hdDE7XYr30

1:52:06 - 1:53:23

I believe he thought the market was overvalued 6 years ago, imagine thats even more of the case now.

Yeah you're right CAD 1.70 but traded at a small fraction from that after the first day

I remember at the time people complaining that they weren't able to hold them due to them be list on the Canadian exchange. If I remember right it dropped so far that someone posted here that their tax bill was more than what they sold for. Terrible from the board