Did some rough checking as Regis in my portfolio was overdue, and in light of the last good quarter, and taking a bit of a stab at what FY25 guidance will be.
DNO is going care and maintenance, so we will lose a few ounces there (10k in March produced), but also in March it cost $35M to run. Going into care C&M, ill leave 10M a quarter to do so for the foreseeable future.
Taken a thumb suck over the last 4 quarters and called it 20M in sustaining capital, but largely kept all other operating costs largely inline with March quarter (stripping $25M out for DNO going into C&M). Assuming nothing happens with McP, ill keep the $25M annually for that, $60M for other growth capital, and $50M for exploration.
We might be looking at guidance of 380,000oz a year (never good to go backwards). Throw all that together and I got the below for FCF numbers, threw a 6 multiple on it and got the below prices for a given gold price.
Regis concerns are around growth, and if they are going to be able to replace the ounces that they mine so we aren't just kicking dirt within 5 years. I'm not a geologist but I think (hope?) they will be able to, and I think management has been a bit slack in the past with proving their resources up into reserves with a lot riding on McP. Now with that looking dead for the next year or so at least, the focus should revert back towards Duketon. Also worth noting the price assumptions that have gone into their reserve cut offs.
I know talk of the town is with a merger with GOR, but RRL want to be careful not to lose their (our) shirt. Our scrip is fairly low due to reserve/growth and we need to look at the latent value that RRL has should those concerns prove to be misplaced.
RRL isn't the star of my portfolio, but it may have the most upside from where we sit today.
(20min delay)