On 9 January 2019, Western Australian gold producer, Ramelius Resources Limited (ASX: RMS) announced that it had exceeded its guidance by producing 52,623 ounces of gold in the December quarter of 2018 from the company’s operations. Following the release of this news, the share price of the company increased by 5 percent as on 9 January 2019.
As per the company’s Managing Director, Mr. Mark Zeptner, the company’s operations team have delivered an excellent result with a 200koz run-rate being achieved for the 5th consecutive quarter.
At the end of December quarter of 2018, the company had cash and gold balance of AUD$108.1 million. Mt Magnet was the major contributor in the production as it produced 19,976 ounces of gold in the December quarter. Vivien and Edna May mines contributed 9,879 ounces and 22,768 ounces of gold respectively.
During the December quarter, the company submitted Mining Proposals for both Edna May underground and Mt Magnet open pits. Now the company’s team is working on finalizing a new production forecast for Edna May taking into account the permitting for Greenfinch, the commencement of underground mining and the acquisition of the Marda project.
During the quarter, the company also completed the Infill and step out drilling below the spectacular Stellar pit drill intersections. The company had spent around AUD$15.1 million on acquisitions and capital development in the December quarter. The company spent A$4.2 million on Shannon open pit, A$3.3 million on Hill 60 underground development, A$1.3 million on Mt Magnet resource definition drilling & project studies, A$0.4 million Sundry, A$4.6 million on exploration across all Projects and A$1.3 million tenement acquisitions of Edna May district.
As at 31 December 2018, the forward gold sales of the company consisted of 172,750 oz of gold at an average price of A$1,750 per ounce over the period to December 2020. The company also informed that subsequent to the end of the December quarter, an additional 11,500 oz were added at an average price of A$1,862 per ounce.
In September 2018, the company announced a takeover to acquire Explaurum Limited (ASX: EXU) fully. Later in December 2018, the company disclosed its best and final offer of 1 RMS share for every 4 EXU shares plus $0.02 per share cash. As at 9 January 2019, RMS had a beneficial interest in Explaurum Limited (EXU) of 72.42 percent.
During the December quarter, the paid the first tranche payment of A$3.2 million to the EXU shareholders who have accepted the RMS offer. The company also provided an unsecured and interest-free loan of AUD$3.7 million to EXU so that EXU could meet its financial commitments and provide ongoing working capital during the Offer Period.
Meanwhile, in the last six months, the share price of the company decreased by 11.50 percent as on 8 January 2019. RMS’s shares traded at $0.525 with a market capitalization of circa $284.08 million as on 9 January 2019 (AEST 4:00 PM).
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