AUS
NZ
UK
CA
USA
IND
Highlights:
- Perenti has been awarded a US$185 million contract extension at Mako Gold mine of Resolute Mining.
- Under the contract extension, the company will optimise fleet and equipment management at the project.
A diversified mining services company, Perenti Limited (ASX:PRN) on Thursday (22 December 2022) shared that it has secured a contract extension for surface mining activities at the Resolute Mining Limited’s (ASX:RSG) Mako Gold mine, located in Senegal. According to the announcement, the contract value is circa US$185 million for a period of four years.
Perenti shares were spotted trading 0.39% higher at AU$1.30 per share at 11:44 AM AEDT with a market capitalisation of AU$888.81 million. Including today’s gain, the share price has surged by 56.02% in the past one year. On a year-to-date basis, it has zoomed up by 37.77% and by 115.83% in the last six months. The share price has surged by 24.52% in the last five trading sessions.
Meanwhile, ASX 200 Materials index was up 0.40% to 17,894.50 points at 12:14 PM AEDT. The index has gained 8.68% in one year and by 4.60% on a year-to-date basis.
Details of the contract extension
Perenti informed the market that African Mining Services (AMS), a surface mining business in Africa, had secured a contract extension for surface mining activities at Mako Gold mine that includes drill and blast, load and haul, grade control and crusher feed.
Perenti has been offering surface mining activities at the Mako Gold mine since 2017 through AMS.
Under the contract extension, the company will optimise fleet and equipment management at the project. This is anticipated to generate sustainable returns at the project and have a low capital expenditure requirement.
Management Commentary
Mark Norwell, CEO and managing director, Perenti commented on the development that,
2025 strategy
In October 2022, the company shared that it had updated its 2025 strategy, which was set in early 2019. The focus of the 2025 strategy at the time of setting up was to:
- Operating in tier-one mining jurisdictions.
- Disinvestment of non-core assets or assets that were not generating results as per the company’s expectation.
- Stabilising underperforming elements of business
- Upgrading legacy systems and processes
Under the updated 2025 strategy, the company would focus on generating free cash flow and delivering competitive shareholder returns. As reported to deliver significant shareholder returns, the company has simplified its structure and revised its operating model.
