Gold stays high
Gold miners' earnings rise with gold prices well above their costs. A producing mine has a largely fixed cost base: labour, energy, consumables and the sustaining capital needed to keep output steady. When the gold price sits well above that all-in sustaining cost, most of each additional dollar per ounce flows straight to operating earnings and free cash flow from production that already exists. The thesis is that an elevated gold price, held for a sustained period, turns established producers into strong cash generators without requiring new mines or higher output. A portfolio under this thesis selects producing gold miners with controlled costs and material exposure to the gold price, rather than diversified miners where gold is a side line. It excludes bullion funds, which track the metal without operating leverage; exploration-only developers with no production; and companies that need higher prices simply to finance construction of their first mine.
Agnico Eagle is a senior gold producer with operating mines in Canada, Australia, Finland and Mexico. it sold about 3.4m oz of gold in 2025 and precious metals were 99.5% of 2025 mining revenue (silver, zinc and copper are minor by-products), so gold is the dominant revenue line by a wide margin. the company has a long-standing policy of no forward gold sales, so the realised price tracks spot; its FY2025 AISC was $1,339/oz against a realised price up 44.9%, and in Q3 2026 AISC of $1,648/oz sat against a realised $4,264/oz. the margin has reached the balance sheet — $950m of debt repaid in 2025, net cash of $2.67bn at year-end 2025 and a raised dividend. this is the direct leg of the thesis as written: established producer, published AISC well below spot, unhedged, gold-dominant revenue. pure play, 1.0.
Alamos Gold is an intermediate gold producer with three operating segments — Young-Davidson and Island Gold District in Ontario and the Mulatos district in Sonora — and gold is effectively all of revenue. Q3 2026 realised price was $4,258/oz against AISC of $1,956/oz (2026 guidance $1,775–1,875), so the margin per ounce is roughly $2,300 and the price-to-margin pass-through the thesis relies on is intact; Q2 revenue rose 36% on a 40% higher realised price despite lower volumes. the legacy Argonaut hedge book has been 96% repurchased, leaving about 14,000 oz of forwards against 510–560 koz of annual production — immaterial. net cash of roughly $400m and buybacks plus dividends show cash reaching the balance sheet. held below 1.0 because 2026 AISC rose 17% y/y after a seismic event at Young-Davidson, putting it mid-curve rather than low-cost, and because Phase 3+, Lynn Lake and PDA growth capex absorb a large share of operating cash flow (Q3 free cash flow $76m on $510m revenue).
Royal Gold is a precious-metal royalty and streaming company with 39 employees and no mine operations — exactly this portfolio's angle. q2 2026 revenue was $450.5m, split 76% gold, 12% silver, 8% copper, with stream revenue of $311.0m and royalty revenue of $139.6m realised at an average gold price of $4,506/oz; adjusted ebitda margin was 83%, so price moves pass almost directly to cash flow on a contractually fixed cost per ounce. no hedge book is disclosed in the q2 release. the Sandstorm and Horizon Copper acquisitions (closed late 2025) added copper and silver, but gold remains above the 70% direct-leg threshold. cash is reaching the balance sheet: $200m of revolver repaid in the quarter and management guiding to full debt repayment in q4 2026. pure play for a royalty and streaming sleeve → 1.0.
AngloGold Ashanti is a senior gold producer with operating mines in eight countries (Ghana, DRC, Tanzania, Guinea, Egypt, Australia, Brazil, Argentina). 2025 revenue from product sales was $9.9bn, of which gold income was $9,730m — about 98% — with silver by-product revenue of $163m. all gold hedges expired at end-2024 and the book has been fully unhedged since 1 January 2025, so realised price tracks spot. 2025 AISC was $1,709/oz (up 6% y/y) against realised prices above $3,000/oz and spot above $4,000/oz in 2026, giving a margin per ounce of well over $2,000. the pass-through is visible in results: free cash flow rose from $956m to $2,908m, the balance sheet moved from $567m net debt to $879m net cash, and the company pays out at least 50% of free cash flow. this is the thesis mechanism in its direct form — gold-dominant revenue, no hedge cap, cash reaching the balance sheet — so pure play.
IAMGOLD is a mid-tier gold producer with three operating mines — Côté Gold (70%) and Westwood in Canada, Essakane (85%) in Burkina Faso. revenue is effectively all gold: q1 2026 revenue of $1,030.1m came from the sale of 211,500 ounces at a realized $4,859/oz against consolidated AISC of $2,124/oz, a margin of roughly $2,700/oz. the 2026 gold prepay delivery obligations were extinguished in h1 2025, so the realized price is unhedged, and q1 free cash flow went to debt reduction (net debt $344m → $105m) and $260m of buybacks — the mechanism the thesis describes. this is the direct leg of the thesis and the whole business, so pure play. note it sits in the upper half of the cost curve (2026 AISC guidance $2,000–2,150/oz), so it is a high-leverage rather than low-cost expression of the angle.
Gold Fields is a senior gold producer with eight operating mines across Australia, South Africa, Ghana, Chile and Peru. H1 2026 revenue was US$5,937m, of which gold was US$5,610m (94.5%); copper from Cerro Corona was 2% and silver from Salares Norte about 3.5%. group AISC was US$1,893/oz against a realised price of US$4,678/oz, so roughly US$2,800/oz of margin on 1.27Moz — adjusted free cash flow more than doubled to US$2,225m, net debt ex leases went to net cash and 61% of free cash flow was paid out. no hedge book appears in the interim results. this is the direct leg of the thesis: fixed-cost producer, gold-dominant revenue, cash reaching the balance sheet. held just below pure play because AISC guidance of US$1,800–2,000/oz sits above the sector average (not the low-cost end of the curve), unit costs rose 13% year on year on royalties and inflation, and Windfall growth capex of US$1.7–1.9bn will absorb part of the cash.
DRDGOLD is a South African surface tailings retreatment gold producer with two operating segments, Ergo and FWGR; gold is effectively all of revenue (R11.2bn in FY2026 from 156k oz sold), it carries no hedge book by stated policy and ended FY2026 debt-free with R2.8bn cash. FY2026 all-in sustaining cost was US$1,986/oz against a received price of US$4,218/oz, a 53% AISC margin, and operating profit rose 83% on a 40% rise in the rand gold price with flat production — the price-to-margin pass-through the thesis describes, visible in reported results. shaded below 1.0 because unit cost sits in the upper half of the industry curve (AISC up 16% in dollar terms in FY2026 on low-grade 0.19 g/t feed and a stronger rand) and the Vision 2028 growth programme absorbs most operating cash, so the cushion and the cash-to-balance-sheet leg are thinner than at a low-cost producer.
Franco-Nevada is a royalty and streaming company that owns no mines and has 44 employees; revenue comes from royalties and streams on producing assets plus a tail of energy and other interests. 2025 revenue was $1,822.8m, of which gold contributed $1,275.8m (70%); precious metals reached 90% of revenue in Q4 2025 (71% gold, 17% silver, 2% PGM). the business is the second-order leg of the thesis as written: revenue moves with the gold price on a contractually fixed, low per-ounce cost, with no exposure to operator cost inflation — 2025 revenue rose 64% on 15% higher net GEOs, almost all of the gap being price. no debt, so no funding-cost drag. the non-precious tail (energy, iron ore, roughly 10 to 20% of revenue) keeps it just short of a perfect pure play against the royalty angle → 0.9.
Newmont is the largest gold producer globally — 11 operated mines plus Nevada Gold Mines and Pueblo Viejo joint-venture interests, 1.30 Moz attributable gold production in Q3 2026 and 1,211 koz consolidated gold sold. gold is the dominant revenue line: 1,211 koz at a $4,317/oz realized price is roughly $5.2bn of $6.36bn quarterly sales, about 82%, with copper, silver, lead and zinc making up the rest as by-products. the thesis mechanism is visible in reported numbers: by-product AISC of $1,454/oz against $4,317/oz realized leaves a margin near $2,860/oz, driving $1.9bn of q3 free cash flow and a $3.2bn net cash position; the company states it does not hedge gold sales, so the realized price is uncapped. cash is reaching shareholders via dividends and a 10% share-count reduction since february 2024. gold above the 70% direct-leg floor, published AISC well below spot, unhedged, established production → pure play, trimmed slightly for the ~18% non-gold revenue and ongoing growth capex.
OR Royalties (formerly Osisko Gold Royalties) is a precious metals royalty and streaming company with no operating mines of its own: 23 employees, a portfolio of 195+ royalties and streams anchored by a 3-5% NSR on Agnico Eagle's Canadian Malartic complex. its 2025 MD&A shows precious metals at 95% of revenue; by GEOs earned in 2025, gold was 52,481 of 80,775 (about 65%), silver about 30%, copper and other under 5%. cash margin runs at about 97%, so revenue from producing assets passes almost one-for-one to operating cash flow with no exposure to operator cost inflation — exactly the second-order mechanism this portfolio targets. the haircut from 1.0 reflects the roughly one-third silver stream share (Mantos Blancos, CSA, Sasa, Gibraltar) and a small copper and diamond tail. against the royalty-and-streaming angle this is a pure play.