Casey comments on ngd

Comments: This is an impressive update. Production grew 3.7% last year and costs fell 9.6%, but 2013 will be even better: production is expected to grow 12% and costs fall by a full third. How can costs falling so dramatically? New Afton will be hitting full stride this year and produces a lot of copper, which is used to offset gold production costs. In an environment of growing concerns about cost control and operating efficiency, New Gold will have growing attraction, and we thus agree with Randall Oliphant's last quote above. We'll also point out that management estimated their all-in cost next year at $875, low compared to most other gold producers (and a reporting trend that is becoming increasingly common). Production will decrease at the Mesquite Mine but grow at all other operations. Reserves fell by about a quarter million ounces, but Resources grew by 2.6 million, giving us little concern due to the exploration potential at New Afton (mine life has already been extended by two years due to successful exploration efforts) and the big Blackwater project, which will have a Feasibility study completed by year-end. The stock has been weak like most gold stocks, but we would definitely buy a tranche at current prices if we did not have a full position of this high quality company.