Price Catalysts Coming Soon

I’ve been running some estimates on 4th quarter results, and then in turn yearly results.
I think we have some very nice price catalysts about to come out.

Firstly, I think we are almost certainly going to beat guidance on both production and cost.
We only need to achieve 22,203oz to beat the upper guidance target of 95,000oz.
Quarters one and two were 28,363oz and 26,075oz, and quarter three was lower due to weather, maintenance and covid at 18,359oz, so I am predicting about 25,000oz for the final quarter to give a yearly total of 97,797oz gold produced.
Nicely above guidance.

If we achieve production guidance by making the 22,203oz, AISC for final quarter only needs to be under US$1,465 per ounce to beat the annual lower guidance figure of US$1,200.
I am predicting final quarter AISC to be US$1,100 (first two quarters were $1,079 and $1,033, so this seems reasonable).
If we achieve my predicted yearly production estimate of 97,797oz, this would make the final AISC for the full year US$1,114, well below guidance, and a superb result.

The final quarter report in a couple of weeks could really surprise on the upside I think.
We should have a cash build of about US$19,000,000 for the quarter.
That will put our total cash backing to over AU$120,000,000. Crazy, given our MC is only $185,000,000.

Now to the yearly results.
This should again provide some good price stimulus.
With an average gold price for the year of about US$1,845 and average exchange rate of 0.75, I am predicting about US$71,500,000 EBITDA.
That should translate to about AU$63,000,000 NPAT and earnings per share around the AU$0.30 mark.
PER under 3.

There will clearly be plenty of cash for at least another 5 cent dividend.
What will be done with all the extra cash? Special dividend or share buyback perhaps?
I will be very interesting to see if the market takes notice once this second 5 cent dividend is declared. Value investors will surely like the look of a 12% yield on a company two thirds backed by cash.
You may know Grange Resources (GGR), another sleepy, boring, reliable earner. It doubled its dividend last half (still only paying out under 25% of earnings), once the market noticed this and woke up to how much cash it was building each quarter, and that cash backing was nearing at market cap, it began to fly, and still is.
It would not surprise me if this happens to MML too.

It would only take a small run in the gold price to really kick things along too.
I know they will require a sizable cash holding to fund ongoing exploration etc, but surely not over $120,000,000. The decline project will require about US$25,000,000 in the first year and then about US$15,000,000 in the subsequent two years. Easily fundable from ongoing cash flows.

Anyway, I would be very interested to hear others take on my numbers and MML’s future.
The next 7 weeks or so should bring plenty of good news.