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Globe editors have posted this research report with permission of Dundee Capital Markets. This should not be construed as an endorsement of the report's recommendations. For more on The Globe's disclaimers please read here. The following is excerpted from the report:

In conjunction with gold's precipitous decline in 2013, gold companies have realized material cost savings in the first half of 2014 (1H14), both from active cost-cutting and from mine optimization and sequencing to accelerate cash flow.

In 1H14, implied costs by cash flow statements were $1,195/oz for companies under coverage, a considerable $228/oz decrease from 1H13's $1,423/oz. Compared to average gold prices over the same period, margins have been stable at 7% (from $101/oz in 1H13 to $96/oz in 1H14).

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Of the $228/oz reduction in 1H costs, an overwhelming 75 per cent of savings can be explained by $171/oz from reductions in sustaining capex. Other factors include savings of $53/oz from processing higher grade ore and $27/oz from lower taxes, offset by $38/oz from higher per tonne unit costs.

Companies which have demonstrated the greatest cost improvement in 1H14 compared to 1H13 include Iamgold and Kinross, while those which have demonstrated the least improvement include Alamos and Primero. The lowest 1H14 cost producers have been Eldorado and Randgold, while the highest have been AuRico and Perseus.

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