tango ORE(US:CTGO)2025-03-18 04:51Financial Data and Key Metrics Changes - The company produced more gold than initially planned, with cash costs slightly above guidance at $1,200 per ounce [8][9] - Total gold production for 2024 was just shy of 42,000 ounces, exceeding guidance by over 25% [11][16] - The company started 2024 with $60 million in debt, finished with approximately $52 million, and projected to end the year with about $15 million remaining [25][26][27] Business Line Data and Key Metrics Changes - The Manh Choh project began production in July 2023, with a total projected gold production of about 60,000 ounces for 2025 [9] - The feasibility study originally planned for five batches in 2025, but adjustments were made to align with production capabilities [17] Market Data and Key Metrics Changes - The average hedge price per ounce is $2,025 for 2025 and 2026, with some hedges rolled into 2027 at mid-$1,900 [74] - The company experienced a realized loss on derivative contracts of $20 million in 2024, contributing to a total of $54 million in losses [38] Company Strategy and Development Direction - The company is focused on minimizing capital costs and permitting timelines by utilizing a direct shipping ore model instead of traditional milling [50][52] - Future plans include permitting access roads and a barge landing site for the Johnson Tract project [61] Management's Comments on Operating Environment and Future Outlook - Management believes the company is undervalued and has been oversold, with a focus on paying down debt and delivering hedges [88][91] - The company aims to be debt-free and hedge-free by the end of 2026, with significant cash flow expected from operations [19][30] Other Important Information - The exploration program for 2024 did not yield significant results, with a focus on evaluating land positions [56] - The company is not planning any drilling or road construction at the Lucky Shot project at this time [72] Q&A Session Summary Question: What factors led to Manh Choh exceeding production guidance? - Management attributed the excess production to effective ore transportation and higher-grade ore availability [11][15] Question: What is the cash flow projection for 2025 and beyond? - Positive cash flow is expected, with plans to use excess cash for debt repayment and hedge deliveries [18][19] Question: How much debt did Contango have at the start and end of 2024? - The company started with $60 million in debt and finished with approximately $52 million [25][26] Question: What percentage of the mine life is unhedged overall? - Currently, about 65% of the mine life is unhedged, with plans to deliver into hedges until the end of 2026 [30] Question: What is the timeline for eliminating the remaining credit facility balance? - The remaining balance is scheduled to be paid down to $15 million by the end of this year, with full repayment by mid-2027 [40] Question: What drove the decision to defer debt payments into 2027? - The decision was based on revised mine plans and the need to align repayment schedules with production capabilities [42] Question: What metrics should investors watch for in the upcoming PEA for Johnson Tract? - Investors should focus on NPV, rate of return, and the project's capital cost savings from not building a mill [58][60] Question: How does management feel about the acquisition of HighGold? - Management is pleased with the acquisition, particularly the Johnson Tract asset, and sees it fitting well with their operational model [64][66] Question: Are there plans for exploring other assets beyond Johnson Tract? - Currently, there are no plans for drilling at Lucky Shot, but strategic discussions are ongoing regarding processing options [94][96]