Loss-Making Troilus Gold Corp. (TSE:TLG) Expected To Breakeven In The Medium-Term

We feel now is a pretty good time to analyse Troilus Gold Corp.'s (TSE:TLG) business as it appears the company may be on the cusp of a considerable accomplishment. Troilus Gold Corp. acquires, explores for, evaluates, and develops mineral properties in Canada. The CA$132m market-cap company posted a loss in its most recent financial year of CA$34m and a latest trailing-twelve-month loss of CA$25m shrinking the gap between loss and breakeven. Many investors are wondering about the rate at which Troilus Gold will turn a profit, with the big question being “when will the company breakeven?” We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.

View our latest analysis for Troilus Gold

Troilus Gold is bordering on breakeven, according to the 3 Canadian Metals and Mining analysts. They expect the company to post a final loss in 2026, before turning a profit of CA$28m in 2027. The company is therefore projected to breakeven around 2 years from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 89%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.

Given this is a high-level overview, we won’t go into details of Troilus Gold's upcoming projects, however, take into account that typically metals and mining companies, depending on the stage of operation and metals mined, have irregular periods of cash flow. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one aspect worth mentioning. Troilus Gold currently has no debt on its balance sheet, which is rare for a loss-making metals and mining company, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.

Next Steps:

This article is not intended to be a comprehensive analysis on Troilus Gold, so if you are interested in understanding the company at a deeper level, take a look at Troilus Gold's company page on Simply Wall St. We've also compiled a list of key aspects you should further examine:

1. Valuation: What is Troilus Gold worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Troilus Gold is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Troilus Gold’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.