Ann: WAF Appoints Project Director for 6.8Moz Kiaka Gold Project, page-4

Ticker: WAF AU Net cash: US$133m Project: Sanbrado / Kiaka
Market cap: A$1,149m Price: A$1.125/sh Country: Burkina Faso
RECOMMEND. (unc): BUY TARGET (unc): A$2.05/sh RISK RATING: HIGH
Not the least coming just after Perseus’ Sudanese acquisition, today’s appointment of an ex Perseus build
manager couldn’t have been timed better after last week’s Kiaka construction/development update.
Qualitatively, we think Scully’s CV points to him likely doing a good build at Kiaka. Quantitatively, we note
the US$74/tpa (initial ~1.3Moz) and US$85/tpa (initial ~385koz) for the 3.3Mtpa and 1.1Mtpa operations,
both of Perseus’ recent builds, came in ‘below the line’ of capital intensity in West Africa. As such, we
maintain our BUY rating and A$2.05/sh PT based on 0.9xNAV5%-1850, including Kiaka at 0.7xNAV (3.4Moz
@ 1.0g/t modelled inventory), Sanbrado at 0.9XNAV (2.5Moz @ 2.4g/t) and a nominal US$50m for
exploration. Whilst the QoQ-watchers will have to take a break now as all efforts go into the new build,
like Centamin before it (doubled from 5 > 10Mtpa, doubled from ~225 > 450koz pa), double the production,
double the share price.
Ex Perseus Project Director, Matthew Scully, to lead development and construction at Kiaka
The appointment of Matthew Scully as Project Director for the Kiaka build adds an experienced project
construction and development leader. Scully was previously Project Director for Perseus, overseeing
A$500m of capital into the Yaouré and Sissingué builds in Ivory Coast, delivering both projects ahead of
schedule and under budget. Prior to this, he was Group Manager of Projects for Evolution Mining,
delivering on the Mt. Carlton gold-silver in Australia.
Why we like West African
1. Sustainable >20% FCF yield & recent GDX inclusion
2. Stock trades at 0.64xNAV excluding multiple new ounce sources
3. M1S future reserve conversion >850m deep (current 1.3Moz @ 9g/t is <850m)
4. M5 UG future conversion around historic 8m @ 17g/t
5. Toega future reserve conversion as only 580koz of 1.3Moz converted to mine plan
Catalysts
 1H22: 25 km / A$12.5m RC-diamond drilling
 1H22: Kiaka updated feasibility study
 CY22: M5 and M1S UG resource drilling
 4Q22 / CY25: Kiaka construction / production
 CY24: Switch from M1S to Toega pit mining

220302-waf-scp-director.pdf (sprott.com)