Monsters of Rock: This under-the-radar gold miner is on a winning run
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Australian gold miners have had another tough reporting season, with Covid, labour shortages and inflation weighing on the ASX’s precious metals cohort despite gold prices improving this year on safe haven demand.
But one company that’s bucked the trend today is dual-listed SSR Mining (ASX:SSR).
SSR is a bit of a curiosity when it comes to ASX gold stocks in that’s it’s been through a couple iterations since it was closely followed by the local investment community.
The Canadian miner’s links to the company go back to its $2.6 billion takeover of ASX-listed Turkish gold miner Alacer Gold Corp two years ago.
Alacer was itself the result of a previous merger between the TSX’s Anatolia Minerals and Avoca, the former owner of the Higginsville and South Kalgoorlie operations near Kalgoorlie.
In any case while the S&P/ASX All Ordinaries Gold Index is up a spare 2.48% year to date and down a porous 5.13% over the past 12 months, SSR shareholders have been in dreamland with its Chess Depositary Interests up 28.13% year to date and 47.94% over the past year.
The secret has been not so secret – strong operating performance, as outlined again in its latest quarterly this morning.
SSR produced 157,010oz of god in the three months to March 31 and a smattering of lead, silver and zinc at all in sustaining costs of just US$1093/oz.
That’s a bit worse than this time last year of 170,149oz at US$970/oz, but the company still hit record quarterly production at its Seabee mine in Canada (52,582oz at outlandish grades of 17.8g/t) and has set a plan in motion to deliver 700,000oz annually in 2022, 2023 and 2024.
The strong performance led SSR to increase its quarterly dividend payment 40% to US$0.07 during the quarter.
“We continue to expect free cash flow to be weighted to the second half of 2022, and we will work to ensure that our capital returns initiatives appropriately reflect our robust free cash flow generation,” president and CEO Rod Antal said.
“Finally, our high-return growth initiatives continue to advance on schedule with Çakmaktepe Extension and C2 targeting first production in 2023 and 2025, respectively.
“We expect to release a number of exploration updates across our asset base through the second half of the year and will look to incorporate those results into updated technical reports in 2023 that build on the strong base-line established earlier this year.”
SSR says its four producing assets at Seabee, Copler in Turkey, Marigold in the USA and Puna in Argentina can produce 700,000oz for the rest of the decade.