Good post Triage.
I appreciate the counter view, as I basically view Stage 3 as good investment, only when in conjuncture with the Marda/Tampia acquisitions (which as @BodoDell mentions, will enhance the numbers at Edna May to bring the AISC back down to around $1300 AUD approx).
Which upon reflections, perhaps provides another reason for RMS having held back from the Stage 3 until now. Add in the $230m in cash now available, and RMS is in a much better position to proceed.
As you mention, up to 500k ounces will be added to the mine plan, though, until the Golden point area is drilled, the upcoming release will likely be closer to 420-450k ounces. You also rightly point out that the large upfront capital cost, raises the AIC to a number around $1800-1900 AUD. Which, is nothing stellar, albeit, only slightly above the sector average for Australia. So... ok, but, when combined with the U/G at Edna, which, as per the plan, is to continue concurrently (in the near term anyway), and Marda/Tampia, you suddenly have RMS with a very different mine plan.
Will obviously be very interesting to compare last year mine plan, with the coming one.
I think it likely, we will see the graph extend to 2030 for starters. I also struggle to see Mt Magnet not improve on FY22. Especially if Vivien is able to be extended, plus Eridanus etc. We will see of course.
I am definitely not worried about RMS getting over extended, MZ and the board have to date, proven to be very careful with their balance sheet. Which is somewhat surprising considering they have been buying assets regularly for years.
Regarding the capex you mention, everything is budgeted for except Stage 3 from last year.
Obviously, the capex is going to be spread across a number of years, which, will likely tie in well with the inclusion of the Penny ounces, which will basically cushion the blow, so to speak. Plus, we will see a general uplift in production, which further supports slightly lower costs across the entire operations. RMS has been capex heavy for quite a few years (though if you follow, EVN, they just put out their 3 year outlook, with up to $1.5-1.7b on top of their AISC. That is roughly $600-700 per ounce, so their AIC will be higher than RMS, even with the inclusion of Stage 3).
Acquisition wise, script will be the main tool, I have no doubt. Cash is best used for investing in a business.
We all continue to wonder what the target might be, but, I feel it will be a asset in production, of some sort, so the cost be softened by cashflow.
I hold both GCY and a few OBM shares, but, to date, my speculation on them being targets, has been proven wrongAs for DCN, anything is possible, but... with $65m in non-sustaining capex planned for DCN next year, and a high AISC, it does seem like the right fit to me.
Cmon over to the GCY thread for some more banter.
Maybe next week we will have all the numbers we need to answer our questions.
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Good post Triage.I appreciate the counter view, as I basically...
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