Gammon Gold (GAM.to) (GRS): What? Another year of missed targets? Hoodathunkit...

What a freakin' joke dog of a gold miner this thing really is. They can't add up resources properly, they can't mine profitably, they have no idea about labour relations. You are the world's biggest prize patsy if you're still holding this PoS. Here's Reuters, here's the company "it's not our fault" wingeing NR and here's the thing that really matters:

As noted recently here at IKN, Dundee did the right thing by their clients and threw in the towel on Gammon in May after the last round of disappointments. By the looks of the note out of Desjardins this morning, it seems Brian Christie is about to do the right thing, too.

Gammon announces indefinite shutdown of El Cubo operations -- Brian Christie (phone number here) , brian.christie @ (email address here)

Impact: Negative

This morning, Gammon announced that it has indefinitely suspended operations at its El Cubo mine due to the continued labour disruptions and what it calls "untenable financial demands" made by the union workforce. As a result, 397 union workers have been terminated and charges are being filed against union executives.

Management is of the view that the mine has been rendered uneconomic, and that further investments (including its own time) are unwarranted. In discussions with the company, there is little indication of when operations will resume. Some of the non-union contractors from El Cubo will likely be relocated to Ocampo in the near-term.

In our view, this shutdown of the El Cubo operations puts Gammon's 2010 production guidance of 260,000-305,000 gold equivalent ounces at risk, given that it is unclear how long the mine will be non-operational. In our model, we had forecast 25% of Gammon's production coming from El Cubo. This mine constitutes approximately 15% of our US$7.67 NAV, and a three-month loss of production impacts our 2010 adjusted EPS by about US$0.07.

We will shortly be reviewing our 2010 forecast.

That Desjardin's forecast is currently a $10.25 price target, which is nothing short of la-la-land. This emperor has no clothes.

The CEO of Gammon Gold (GRS) (GAM.to) needs a dictionary........

.....because he should check the definition of the word "strong".

Today Gammon Gold (GRS) (GAM.to) released its 1q10 earnings, which it described as strong.

Let's see why our friend the owl seems to disagree with the use of that adjective. First there's gold and silver production. Despite previous production forecasts from GAM that said the company would produce between 200,000 oz and 220,000 oz gold in 2010, the first quarter number of 28,431 oz (which annualizes at 113,724 oz) leaves mucho mucho to be desired:

Then there's silver production that came in pisspoor too. (Previous GAM forecasts of 8.5m oz to 9.275m oz Ag also look very silly nowadays).

Cash costs continue on up (previous GAM guidance on costs was $315/oz to $350/oz for 2010)....

...with $490/oz a new recent high on costs. So when it comes down to the nitty-gritty, the $1.828m net profit reported by GAM.....

....does not justify the U$7.50 share price currently commanded by GAM (the US ticker being GRS)...not even close. That's because with 138.4m shares out, this company makes a $1.8m quarterly profit and thinks it's worth over a billion dollars. Craziness abounds.

Anyway, GAM has its ConfCall at 10am EST today, which you can tune into via this link. I'll be there listening and noting just how many softball questions get tossed by the lapdog brokerage analysts that cover this stock. They're unlikely to be too hard on GAM, cos clients are up to their eyeballs in paper generated by previous rounds of financing. Don't wanna rock da boat too hard, eh boyz...