'That's when the multiples begin to come back' - Peter Marrone on mining equity lift-off

Despite gold hitting several all-time highs in 2024, margins have been a drag on mining equities, said Peter Marrone, chairman and CEO of Allied Gold. In early June, Marrone spoke to Kitco Mining at THE Mining Investment Event of the North. Marrone noted that gold spiked at the start of the decade to around the $2,020 level and then stayed relatively flat until recently. Marrone said that during that time, margins amongst gold miners declined from about $750 to $575. The VanEck Gold Miners ETF (GDX) has come anywhere near its highs from the start of the decade."That run-up in gold price is quite dramatic, and I think it will continue," said Marrone. "And now, as an industry will we be able to demonstrate that we can deliver improvements to margins, increase in EBITDA, increase in cash flow? And that's where the rubber hits the road because, at that point, I think that's where the multiples begin to come back." Allied Gold (TSX:AAUC) has both producing and development stage properties in Africa, including countries such as Mali, Côte d’Ivoire and Ethiopia. The company is targeting about 800,000 gold production by 2029. Coverage of THE Mining Investment Event of the North is sponsored by EMX Royalty.Disclaimer: The views expressed in this podcast are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this podcast do not accept culpability for losses and/ or damages arising from the use of this publication.