TORONTO - The clever people at PRICEWATERHOUSECOOPERS (PWC) have examined junior mining companies trading on the TSX Venture exchange and determined that their total market capitalization rose to $27.6 billion last year. That represents an 86% increase from $14.8 billion in 2005.
The PWC report, Junior Mine: Review of trends in the TSX-V mining industry, examines the financial position of the top 100 of 967 junior mining companies on that stock exchange. The 100 companies represent over half of the TSX-V mining industry by market capitalization as of Sept. 30, 2006. The top junior mining companies had $4.0 billion in total assets in 2006, $2.6 billion more than in 2005. Eighty-six of the 100 were engaged in mineral exploration.
High commodities prices fuelled investor confidence and allowed TSX-V companies to raise impressive amounts of capital last year. Exploration companies raised $1.2 billion, a 206% increase from 2005. The juniors were led, of course, by the gold sector: four of the five largest TSX-V mining companies focus on it, and gold companies account for 60% of the market.
The writers of the report, however, stopped short of promising such high-flying numbers for TSX-V juniors this year. The report said, 2006 was a year when values rose sharply for Canadas junior mining companies and when they made significant exploration expenditures. If these investments pay off, and commodity prices remain high, 2007 will be another strong year.
The entire report is available for free at www.PWC.com/mining.
PWCs annual review of British Columbias mining industry is available at the same website.