Pantoro’s Quarterly Headline Disaster — And Why It’s Completely Mispriced

Pantoro’s quarterly looked ugly at first glance — lower production, higher AISC — and the market did what it always does: traded the headline and ignored the business. The weather smashed them, Scotia flooded, OK was mid contractor swap. Annoying for sure, temporary all the same. Nothing structural changed other than the grades they keep finding.

What actually matters is what’s happening underground, for me it’s the part the market hasn’t priced.

Scotia is quietly turning into a monster.

This isn’t incremental improvement — this is system scale growth hiding in plain sight. Three independent ore sources are now running for the first time since the decline went in. That alone is a major shift in mine flexibility. For me the drilling is the real story.

You don’t get 16m @ 10.6g/t, 10m @ 6.7g/t, 7m @ 11g/t, and 3.5m @ 49.8g/t in a mature system unless you’re tapping into something far larger than the current mine plan. These aren’t “nice hits”. These are the kind of intercepts that force planners to redraw stopes, extend declines, and rethink the entire production profile. If these results had dropped on a quiet day without the weather smashed quarter attached, the stock would’ve been up double digits. Instead they got buried under AISC panic. That’s the opportunity. Scotia isn’t the problem — Scotia is the reason you buy the dip.

And it’s not just Scotia.

Butterfly is shaping up as a second underground mine in the Mainfield. The hit rate is strong, and Pantoro already signalled the program is being expanded because the numbers demand it.

O’Briens/Crown South is already approved as the third underground mine. Most producers would kill for one new UG mine. Pantoro now has three in motion.

Gladstone starts feeding this quarter, adding near term tonnes and taking pressure off the undergrounds.

Despite all the operational noise, they still increased cash and gold by $37.8m and finished with $250m on the books. Zero debt. A buyback at $3.50. That’s not a stressed balance sheet — that’s a company absorbing a messy quarter and still printing money.

The only things that changed this quarter was the weather, diesel, and a contractor swap — all temporary.

I'm here for the multi year Norseman build out, this dip is a gift. I’m adding. The only real risk in my view is execution risk — not the thesis, which looks solid and if anything keeps getting firmer.

DISC: Hold IRL & SM(order in at time of writing)