Perseus Mining’s Shares Continue To Mount Up On Yaouré’s Prospects

ASXPRU

Up 4% on October 12, 2018 (1:45 PM AEST), Perseus Mining Limited (ASX: PRU) is continuing with its uptrend streak. On 11 October 2018, Perseus Mining Limited (ASX: PRU) announced the completion of value engineering assessment (VEA) and the front-end engineering and design (FEED) study for the Yaoure Gold Project. Yaoure is the company’s third Gold mine. Following the release of this news the share price of the company increased by 8.696 percent as on 11 October 2018.

The VEA and FEED started in June 2018 by Independent consultant Lycopodium Minerals Pty Ltd and got completed on time on October 6, 2018. The definitive feasibility study (DFS) for the Yaoure Gold Project was conducted in October 2017 which delivered some cost estimates and demonstrated the strength and quality of Yaoure. These cost estimates have been confirmed by the recently conducted VEA and FEED study. DFS study reported that the project is economically attractive as it is having IRR of 27 percent with a 32-month pay-back period at a $1,250 per ounce of gold. As per the DFS study the project is readily financeable with capital cost estimated at $263 million and healthy cash flows to pay for debts. DFS report states that the project can be stretched beyond its initial 8.5 years mine life through near mine opportunities which will increase Mineral Resources and Ore Reserves mineable using both open pit and underground mining technique. 

VEA study assessed the opportunities to improve plant design and optimize the estimated capital expenditure while it was also focused on progressing the design of the processing plant and infrastructure to prepare a detailed capital cost estimate with a level of accuracy of +/- 10%. The FEED study was completed on time and on budget and it was a major milestone for the company as it has delivered a satisfactory outcome with the capital cost of $264 million which is within the 0.5 percent of DFS estimate.

In FY 2018, due to the increased sales volumes the revenue from the operating activities increased by 36.5 percent to $378.08 million as compared to the previous year. The loss after tax from ordinary activities decreased by 70 percent to $24.9 million. The net intangible assets per share of the company increased from $0.80 in FY 2017 to $0.88 in FY 2018. The basic and diluted loss per share of the company decreased from 7.74 cents in FY 2017 to 2.50 cents in FY 2018. Company is having a current ratio of 1.49x. The net cash flow from operating activities increased from $0.86 million in FY 2017 to $68.3 million in FY 2018.

In the past six months, the share price of the company decreased by 24 percent as on 11 October 2018. PRU’s shares traded at $ 0.375 with a market capitalization of circa $ 357.04 million as on 11 October 2018 while they touched $ 0.39 on October 12, 2018 (1:45 PM AEST) with market capitalization moving up to $ 388 million.

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