The Canadian Mining Eye index had its first gain in a year in 2015’s second quarter, EY announced August 24
The Mining Eye tracks the performance of 100 TSX and TSX Venture mid-tier and junior mining companies.
The index, which is constituted of companies with a market value of between $65 million and $1.8 billion, gained 4% during Q2 2015, compared with a 1% decline in Q1 2015. This was the first quarterly gain since Q2 2014.
The performance improved at a time of lower metals prices – gold was down 2% during the quarter, copper dropped 5%, nickel and lead were down 3% and 5% while and zinc slipped 4%.
Bruce Sprague, EY’s Canadian Mining & Metals Leader says despite the slump, "a few companies surprised investors with better-than-expected financial results, higher production data, accretive acquisitions and steady progress on planned projects. While companies remain cautious about their capital expenditure and are focusing only on high-return, priority investment, that strategy seems to be paying off."
Perhaps more encouraging than stock market performance, fundraising by miners also picked up compared with a dismal 2014. However, events since the end of June are likely to cloud this picture.
According to EY, total proceeds of $2.2 billion were raised by TSX- and TSXV-listed mining companies during the quarter. While that is down 28% compared with Q1 2015, it represents a jump of 62% acompared with the same period a year ago.
TMAC Resources had a successful IPO to raise $135 million for its Hope Bay gold project, Largo Resources raised $75.2m in a private placement for the development of its Brazlian vanadium mine, Trevali Mining secured $30.6m in a secondary public offering destined for its Caribou Zinc Mine in New Brunswick, Rubicon Minerals executed a $30.2m private placement towards Canadian exploration expenses while First Majestic Silver raised a similar amount privately to advance its Mexican properties.
