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Highlights
- March quarter gold output expected below forecast
- Operational hurdles cited for limited production
- Stronger production outlook for remaining quarters
Shares of Emerald Resources (ASX:EMR) traded lower after the company announced a production shortfall at its flagship Okvau gold project in Cambodia for the March quarter. The decline in output, largely attributed to earthworks and restricted access to key ore zones, led to a dip in investor sentiment during early trade.
By 11am AEDT, shares in Emerald Resources were down approximately 4% to $4. Despite the day’s decline, the stock has still recorded a robust 35% gain over the past year, reflecting overall market confidence in the long-term potential of the company’s Cambodian operations.
Emerald Resources expects gold production from Okvau to reach around 20,000 ounces for the March quarter, falling short of its previously issued guidance range of between 25,000 and 30,000 ounces. The company attributed the reduced output to ongoing earthworks and waste movement activities, which impacted access for heavy equipment and delayed mining of higher-grade ore zones late in the quarter.
While the current quarter’s performance is below expectations, Emerald Resources provided a more optimistic outlook for the remainder of the year. According to the company, the next three quarters are projected to deliver production at the upper end of guidance. This rebound is anticipated due to the completion of the cut-back activities that temporarily impacted operations.
The miner emphasized that these activities are part of a broader strategic plan to extend the life of the open-cut mine and facilitate early development of an underground mining portal. “Although the earthworks and waste movements related to the cut back activities hampered production during the current quarter, the cut back is designed to allow for the extended life of the open-cut operations and to facilitate early access to an underground portal,” the company noted.
Despite the short-term production dip, Emerald Resources remains focused on enhancing long-term value through continued development of its gold assets. Investors will be closely watching the company’s execution over the coming quarters to see if it can deliver on its improved output targets and leverage the foundational work currently underway at Okvau.
