April 8th, 2009:
Yamana Gold Inc (AUY)
Current Price: $8.17
www.yamana.com
Yamana Gold, Inc. (AUY) is a Canadian-based gold producer with significant gold production, gold development stage properties, exploration properties, and land positions in Brazil, Chile, Argentina, Mexico and Central America.
AUY has seven operating mines and five development projects. Its principal operations include the Chapada, a copper/gold mine located in the state of Goias, Brazil; and the El Peñón mine located in the Atacama desert in Region II of northern Chile.
AUY is targeting production growth from the approximately 1 million ounces of gold equivalent they produced in 2008 to approximately 2 million ounces of gold equivalent in 2012.
Since their inception in 2003, AUY has successfully turned undervalued Brazilian properties into profitable, producing mining operations, implemented an extensive exploration program and increased reserves and resources as well as proved their operational expertise through the building of two major mines, including Chapada, AUY’s original flagship mine.
In 2006, AUY acquired RNC Gold which immediately added 130,000 ounces of gold production to their business via the San Andres gold mine in Honduras. AUY also acquired Desert Sun, which added the Jacobina Mine in Brazil to their list of properties. Jacobina is a long-life mine boasting proven and probable gold reserves of over 1.5 million ounces.
In 2007, AUY proved the value of the acquisitions done in 2006 as they became a cash flow and earnings generating company. They fortified the base for subsequent phases of growth and distinguished themselves as the premier intermediate gold producer.
In 2008, AUY focused on organic growth with a strong push on exploration for both the short and long term and continued to excel and deliver on their promises. It is their goal to increase production to approximately 1.4 million gold equivalent ounces in 2009, which from our understanding can be achieved from their existing mines and projects under development.
To learn about AUY's reserves and resources please visit:
http://www.yamana.com/Investors/ReservesAndResources/default.aspx
AUY reported 2008 revenues of $1.05 billion up 41% over 2007 revenues of $747 million. AUY's 2008 net earnings were $434.8 million up 294% over 2007 net earnings of $110.3 million.
AUY had unbelievably low production costs in 2008 of just $384 per gold equivalent ounce, well below some of their larger rivals in the industry.
The average analyst is projecting AUY to grow revenues to $1.41 billion in 2009 with EPS of $0.46. AUY's first quarter 2009 results will be announced after the close on May 5th.
AUY has a strong balance sheet with total cash and available credit of approximately $420 million. AUY is well positioned financially to fund its strategic growth plans. NIA believes AUY has the characteristics and strategy necessary to prosper during the upcoming hyperinflationary crisis.
A co-founder of NIA has purchased 2,300 shares of AUY at an average price of $12.07 and could sell them at any time.
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