Virtually every industry group except for precious metal miners is experiencing a choppy recovery in their operations. The commodity price cycle is certainly a double-edged sword and what it’s doing is making the cost of raw materials that much more expensive. You can feel it at the individual level at the gas pump, or your local coffee shop or bakery. Businesses are also feeling the crunch, as transportation costs are going up. So, while some businesses benefit tremendously with higher prices for commodities, most find the higher input costs to be very detrimental.

As investors, we have to roll with what the markets offer and, as you know, it’s a fantastic time to be in the gold production business. This sector remains perhaps the best industry for equity speculators at this time.

I want to take the opportunity in today’s column to show you what I view as the perfect example of an attractive junior gold miner. This stock has already done very well, not just because the price of gold has been strong. The business serves as a great example as to what investors should be looking for in a junior gold mining investment—solid management, known properties, a strong balance, and growing production, etc.

Richmont Mines Inc. (AMEX/RIC) is a junior gold miner in Canada that has produced over one million ounces of gold from a number of its properties. In 2011, the company’s goal is to produce between 80,000 and 85,000 ounces of gold. The company’s long-term business plan is for annual production to grow to over 200,000 ounces of gold per year. Even if the price of gold doesn’t go up, this kind of production growth means that the company’s finances should continue to improve.

In its fourth quarter of 2010, the company’s total sales were $26.2 million, representing substantial growth of 53% over revenues of $17.1 million generated in the same quarter of the previous year. That’s way better than a technology stock. Earnings for the fourth quarter of 2010 were $4.6 million, or $0.15 per share, compared to breakeven net income of $0.1 million, or $0.00 per share, generated in the fourth quarter of 2009. For all of 2010, the company’s revenues were $90.8 million, compared to $71.9 million in 2009. Earnings for the year were $9.0 million, or $0.31 per share, compared to $0.3 million, or $0.01 per share, in 2009.

In 2010, Richmont Mines sold 68,123 ounces of gold at an average price of $1,243 per ounce. This compares to gold sales of 59,733 ounces at an average price of $969.00 per ounce in 2009. The company finished the year with $40.0 million in cash, no long-term debt, and no hedging obligations.

Not surprisingly, a company with this kind of growth and solid expectations for the future has already seen its stock price do very well. But, I wanted readers who might be interested to see what I think an attractive junior mining business looks like. It’s a unique business model that is cyclical. But, if you get the timing right, it seemingly pays more than any other business model in any other industry right now.