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ASX-Listed Gold Miners Reported March 2020 Quarterly Performance- SBM, NST, and SAR

  • April 28, 2020 10:06 PM AEST
  • Kunal Sawhney
    CEO Kunal Sawhney
    2263 Posts

    Kunal Sawhney is founder & CEO at Kalkine and is a richly experienced and accomplished financial professional with a wealth of knowledge in the Australian Equities Market. Kunal obtained a Master of Business Administration degree from University of T...

ASX-Listed Gold Miners Reported March 2020 Quarterly Performance- SBM, NST, and SAR

After an impeccable rally and reaching near a seven-year high of USD 1,747.85 (intraday high on 14 April 2020), gold prices are now taking a breather. However, despite a slight correction in prices, a relatively higher gold prices in 2020 as compared to the previous year seem to be benefiting the ASX-listed gold stocks.

Gold MTF non-AMP

To Know More, Do Read: Gold Shatters 7-Year High, Joy Ride Coming For ASX-listed Gold Stocks?

Many of the ASX-listed gold-related companies such as St Barbara Limited (ASX:SBM), Northern Star Resources Limited (ASX:NST), Saracen Mineral Holdings Limited (ASX:SAR) are now briefing stakeholders over their quarterly performance, even though these companies witnessed some operational challenges in the wake of an interstate travel ban imposed by the State Governments, they ultimately did well on account of high gold prices.

St Barbara Produces 91,547 Ounces of Gold in March 2020 Quarter

St Barbara reported its March 2020 quarterly performance and suggested that the gold production during the period stood at 91,547 ounces, down by ~ 2.77 per cent against the previous quarter. The gold production across Simberi and Atlantic prospect remained somewhat steady and also witnessed a slight increase, while the production across Gwalia fell by ~ 5.56 per cent during the period against the previous quarter to stand at 39,684 ounces.

SBM further suggested that the decline in Gwalia production was due to the lower grade and lower mined volume.

However, despite a slight drop in the overall production, the Company sold 99k ounces of gold for the period, up by 2.06 per cent against the previous quarter, and realised an average price of $2,123 per ounce, which remained ~ 8.31 per cent up against the previous quarter.

The all-in sustaining cost for the period rose slightly by ~ 3.00 per cent, which along with the fall in production requires further investigation.

The snippet of the performance for March 2020 quarter is as below:

Source: Company’s Report

SBM intends to produce 370-400k ounces of gold for FY20 (June reporting) and suggested that the full-year production at Gwalia would be at the lower end of the guidance range of between 170,000 and 180,000 ounces, with all-in sustain cost (or ASIC) correspondingly at the higher end of the guidance range of between $1,470 and $1,540 per ounce.

The stock of the Company last traded at $2.460 (as on 28 April 2020 03:34 PM AEST), down by 4.28 per cent against its previous close on ASX.

  • Northern Star Resources Limited (ASX:NST)

NST Sells 239,031 Ounces of Gold to Generate $504.2 million Quarterly Revenue

NST released its March 2020 quarterly report and mentioned that the Company sold 239,031 ounces of gold during the period, up by ~ 11.36 per cent against the previous quarter. The Company realised an average price of $2,179 per ounce during the period, up by ~ 5.62 per cent against the previous quarter, leading to quarterly revenue of $504.2 million, up by ~ 13.89 per cent against the previous quarter.

The Company generated an underlying free cash flow of $89 million for the period post deducing the investment amount of ~$66 million in growth capital and exploration.

Source: Company’s Report

NST produced 270,293 ounces of gold during the period, up by ~ 14.80 per cent against the previous quarter, and the ASIC for the period surged by ~ 11.89 per cent to stand at $1,590 per ounce, which could be expected in lieu of higher exploration expenditure and rise in production.

The Company recently completed the KCGM acquisition and reported cash, bullion and investments of $551 million for the end of the March 2020 quarter and mentioned that it utilised $200 million from the corporate credit revolver facility, and now, the corporate debt stands at $700 million (as on 31 March 2020).

NST has deferred the interim dividend to 27 October 2020 and has suggested that the full-year dividend would be paid as normal, accounting for 6 per cent of group revenue.

The stock of the Company last traded at $13.200 (as on 28 April 2020 03:34 PM AEST), down by 2.79 per cent against its previous close on ASX.

  • Saracen Mineral Holdings Limited (ASX:SAR)

SAR sells 165,798 ounces of Gold and Generates $369 Million in Revenue for the March 2020 Quarter

The Company produced 158,132 ounces of gold for the period, including 58,563 ounces from KCGM, in which SAR holds 50 per cent stake, and sold 165,798 ounces at an average realised price of $2,228 per ounce.

SAR witnessed a record quarter at Thunderbox prospect with the production of 50,091 ounces of gold at an AISC of $1,133 per ounce, while the Carosue Dam produced 49,478 ounces of gold at AISC of A$1,308 per ounce and KCGM produced 58,563 ounces of gold (on 50 per cent basis) at an AISC of $1,415 per ounce.

The Company also suggested that the COVID-19 outbreak had a minimal impact on the quarterly production; however, suggested that June production might take a hit while keeping the FY2020 guidance over 500k ounces of gold.

SAR has large ore stockpiles, which exceeds over 1.7 million ounces (as on 31 March 2020), which would help insulate the business if the mining activities face some restriction ahead in the wake of the COVID-19 outbreak.

Saracen held cash and equivalents of $340.3 million at the end of the period post making an additional early debt repayment of $25 million and a final tax of $15 million for FY19 and investing $14 million over the exploration activities.

In the status quo, the Company has decided to draw down its $45m revolving credit facility to maximise cash reserves and mentioned that it holds a gold hedge of 542,500 ounces at an average delivery price of $2,056 per ounce.

SAR has kept the production guidance for FY21 (commencing June 2020) above 600,000 ounces.

The stock of the Company last traded at $4.520 (as on 28 April 2020 03:34 PM AEST), down by 0.87 per cent against its previous close on ASX.

 

 


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