MB Capital Strategies Glossary — Updated June 2026
AISC (All-In Sustaining Cost) is the gold mining industry's standardised metric for measuring the full cost of producing one ounce of gold. Developed by the World Gold Council in 2013, AISC replaced the older "cash cost" metric because it captures a much more complete picture of what it actually costs to keep a mine running. For dividend investors in gold stocks, AISC is the single most important cost metric — it tells you the margin between the gold price and what the producer actually keeps.
The key addition over the old "cash cost" metric is sustaining CAPEX — the ongoing capital spending needed to maintain current production levels. Without this, a company could report low cash costs while silently running its mines into the ground.
At a gold price of $3,000/oz and an AISC of $1,400/oz, the AISC margin is $1,600/oz (53%). This is the gross operating surplus available for taxes, debt service, dividends and growth CAPEX. The higher the margin, the more cash reaches shareholders.
| Producer | AISC (approx. 2025) | Margin at $2,500/oz Gold |
|---|---|---|
| B2Gold | $1,450–1,550/oz | $950–1,050/oz (38-42%) |
| Barrick Gold | $1,400–1,500/oz | $1,000–1,100/oz (40-44%) |
| Newmont | $1,440–1,540/oz (post-Newcrest integration) | $960–1,060/oz (38-42%) |
| Agnico Eagle | $1,200–1,350/oz | $1,150–1,300/oz (46-52%) |
Note: These are approximate figures based on publicly available earnings reports. Always verify against the most recent company reporting. Not investment advice.
Sensitivity analysis: At gold prices of $2,000/oz, $2,500/oz and $3,000/oz, a low-AISC producer like Agnico Eagle generates meaningfully different cash flows than a high-AISC producer. The lower the AISC, the more resilient the dividend at lower gold prices. For investors focused on hard-asset dividend income, a producer with AISC below $1,300/oz has a much wider margin of safety than one at $1,700/oz.
AISC creep is a warning sign: If a miner's AISC rises faster than the gold price over several years, margin compression is underway. Watch for AISC creep driven by ore grade deterioration (the mine is getting harder to dig), rising energy costs, or increasing sustaining CAPEX requirements as infrastructure ages.
AISC vs All-In Costs (AIC): Some producers report an even more comprehensive metric called AIC (All-In Cost) which also includes major growth project spending. AISC is limited to sustaining the existing production base. For dividend investors, AISC is the relevant metric — AIC is more useful for project-level return analysis.
Producer A (High AISC = $1,750/oz): Margin = $750/oz. Produces 500,000 oz/year → Gross margin ~$375M. After taxes and debt service, FCF is thin. Dividend depends on sustained high gold prices.
Producer B (Low AISC = $1,200/oz): Margin = $1,300/oz. Same 500,000 oz/year → Gross margin ~$650M. FCF is robust even at $2,000/oz gold. Dividend is sustainable through the cycle.
The $275M FCF difference on identical production is the structural advantage of a low-AISC producer. This is why AISC is a first-screen filter — before looking at P/E or yield, check if the producer can survive a gold price correction.
One way to avoid AISC risk entirely is through royalty and streaming companies (like Franco-Nevada, Royal Gold, Wheaton Precious Metals) which have effectively zero AISC — they receive a fixed percentage of production without bearing mining costs. The tradeoff is that royalty companies trade at a premium valuation compared to producers. Whether the premium is justified depends on your view of gold price direction and risk tolerance.
Marco Bozem
Investor & Analyst | Hard Assets, Mining, Shipping | MB Capital Strategies
Marco analyses mining and hard-asset stocks with emphasis on cost structure, dividend sustainability and cycle positioning. All analysis based on public reports. Not investment advice.