ASX gold miners are starting to put the hard numbers around their 2021 performance
Reporting season is nigh for Australian gold miners, who are due to unveil their FY21 production results and earnings over the coming weeks.
It is as they say, “where the rubber meets the road”, the proof in the pudding on just how Australia’s class of gold miners have performed in the past year.
Fast out of the blocks today were $310 million-capped Firefinch (ASX: FFX), owner of the Morila gold mine in Mali and Ramelius Resources (ASX: RMS), a mid-cap which produces a bit under 300,000ozpa from its portfolio of gold mines in outback WA.
The end game for Firefinch at its Morila Gold Mine is growing the operation, one of the biggest and highest grade gold mines globally in the early 2000s, up to 200,000ozpa over the next few years.
It will do that by validating and restarting the project’s main “super pit” deposit, but meeting the upper end of guidance in the June Quarter from its tailings retreatment project and satellite pits is a good start.
Firefinch raised $47 million from investors recently to fund growth at Morila and carry its half of the large Goulamina lithium mine to its demerger.
The newly minted gold miner, which only bought Morila from AngloGold Ashanti (ASX: AGG) and Barrick Gold for ~US$29 million late last year, produced 12,555oz in the June quarter towards the upper end of its 11,000-13,000oz guidance.
5013 of those ounces came in the month of June, 21% better than the company’s previous record.
It is likely to beat that record again in the September quarter, with rising contributions from satellite pits leading to big increase in recoveries and guidance of 13,000-15,000oz as it enters its first full year at Morila.
An unusually wet winter in Western Australia should be good for the farmers, but is hasn’t been so welcome for Wheatbelt gold miner Ramelius, which missed guidance from its Mt Magnet and Edna May operations.
It generate 61,480oz against guidance of 65,000-70,000oz in the June Quarter, blaming rainfall events, personnel shortages and Covid lockdowns.
Ore haulage has begun from its new Tampia Mine to the Edna May processing plant. Unlike its Marda plant deposit the road from Tampia is sealed so the company is hoping to reduce the impact of rain on its schedule.
Ramelius produced 272,109oz for the whole of 2020-21, a record and just shy of its updated guidance of 275,000-280,000oz (but within its original range of 260,000-280,000oz).
It has maintained all in sustaining cost guidance of $1280-1330 per ounce.
Expect Northern Star (ASX: NST), Evolution Mining (ASX: EVN), Newcrest Mining (ASX: NCM), Resolute Mining (ASX: RSG), Regis Resources (ASX: RRL) and St Barbara (ASX: SBM) to be among the stocks closely watched by industry observers.
Gold Road Resources (ASX: GOR), which owns half of the giant Gruyere gold mine in WA’s remote Yamarna belt with South African major Gold Fields, last week got out ahead of time to say costs would be higher and production lower than guidance after processing plant issues.
And now for something completely different…
While miners and explorers have been the beneficiaries of rising market sentiment over the past year, mining services stocks are now starting to receive some attention as the flow-on effects of increased activity in the resources sector emerge.
The firm has seen a 41% increase in work in hand to $1b, with 2022 EBITDA expected to be 15% higher than 2021.
Managing director David Macgeorge said contract margins were also on the up.
“We expect our FY21 EBITDA result to be at the top end of previous guidance, underpinned by new contract wins, strong operating cashflows and continued margin improvement through delivering for our blue-chip client base,” he said.
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