Australia's largest stock trading and investment forum Australia's #1 stock forum

GOLD

Click for more information

0.51%

$1,391.7 gold futures

Jun-21 - Quarterly Summary, page-2

First 2 Last

Share
Profile

Follow
monty11

154 Posts.

6

01/08/21

15:37

Post #: 54940301
Share
Originally posted by JSS-2107: ↑

Afternoon all. I've summarised below the gold producers summary for Jun-21 quarter. My objective is to spark some constructive discussion re. the relative performance and merits. I have other data available (e.g. at individual mine level) - please shout with any queries. Also - please call out any errors in the data. Charts include:
Production (incl. production v. guidance)
AISC (incl. AISC v. guidance)
Production and AISC
Production and margin
Cash and net cash
Net cash change from Mar-21 quarter
Hedging position

1. Production (incl. production v. guidance)

Two new producers included this quarter: OBM (Davyhurst commissioned and producing last quarter, but I missed it from the Mar-21 report) and CMM (newly commissioned Karlawinda)
2.46m oz produced in the quarter (up 28% v. Mar-21 quarter (1.92m)); Q4 for many producers – often a big month as companies strive for strong year-end performance
NCM still the top producer at 542koz, but NST improved dramatically c. Mar-21 quarter (increase of 85koz, 23% uplift)
Guidance increases in the quarter: EVN (up 1%)
Guidance decreases in the quarter: RED (down 8%), RSG (down 10%), WGX (down 13%), SBM (withdrew guidance)
Over-achieving guidance: PRU (103% of mid-point), MML (103%), ALK (108%), BLK / WMC (101%), OBM (103%)
Missing guidance: EVN (97% of mid-point YTD), WAF (Q2; 45% of mid-point; guidance narrative noted ramping up in CY2021), RMS (98% of mid-point), DCN (95%), TRY (64%)
The % figures compare production YTD v. the midpoint of each organisation's guidance range

2. AISC (incl. AISC v. guidance)

Average AISC in quarter = A$1,661 (Mar-21 quarter = A$1,555; an increase of 7%)
Weighted average AISC in quarter = A$1,333 (Mar-21 quarter = A$1,400; a decrease of 5%)
Only 5 producers under the weighted average – KLA, NCM, WAF, EVN and RMS
No AISC guidance data for NCM, SBM (withdrawn in quarter), CMM, KAU and KRM.
Guidance decreases in quarter: EVN (down 5%)
Guidance increases in quarter: RED (up 2%), RSG (up 7%), OGC (up 9%), WGX (up 1%), SBM (withdrew guidance)
Over-achieving guidance: RSG (95% of mid-point), WGX (94%), AMI (97%), MML (95%), AIS (96%), ALK (90%), BLK / WMC (90%), OBM (95%)
Missing guidance: RRL (109%), WAF (145%; Q2; guidance narrative noted likelihood for this to drop in H2), GOR (117%; Q2), DCN (106%), TRY (140%)
The % figures compare production YTD v. the midpoint of each organisation's guidance range

3. Production and AISC

Mid-tier producers struggling with cost management (several have called out staff costs)
Variability at the low end

4. Production and Margin

NCM and KLA throwing off some fantastic results – very high production, low AISC, good sell price, excellent margin. See Net Cash chart below showing delta position v. Mar-21
Average gold sales price in the quarter was surprisingly varied:
GOR – A$2,145 (big hedges at low price)
NST – A$2,179
PNR – A$2,524
BLK / WMC – A$2,651

5. Cash and Net Cash

KLA has a staggering A$1.15m net cash position. Wouldn’t be surprised to see them use it for M&A (they currently have 3 producing mine centres).
SLR still have huge reserves, and still coming under pressure to use them.

6. Net Cash Change from Mar-21 Quarter

NST added a cool A$126m to their net cash position. SAR merger seems to have settled very quickly – could they be building towards their next acquisition?
SLR grew their net cash position slightly in the quarter (by A$10m to A$330m).
EVN – significant drop resulting from the Battle North acquisition.
OGC – not immediately clear why.
CMM – completion of construction and commissioning

7. Hedging

Usual caveat - I don't believe that there is a good or bad position re. hedging. It is what it is, and the hedge v. market position will determine whether it helps an organisation's result, or it doesn't (RRL's hedge at A$1,571 meant it had the lowest average sales price in the quarter (A$2,014)).
RRL has almost 400% of Mar-21 production in their hedge book at an average price of A$1,621.

Closing
As noted in the intro - I am really keen to get some constructive conversation going re. the quarter. I have a stack of other data available if anyone has any queries. And as always, please do flag any errors, etc.
I have some views that attempt to look at valuation (EV) v. these quarterly results (e.g. who is the best value re. margin, who is the best value re. production scale, etc.). Happy to share if folks think they would be useful.
Disclosure: I hold the following stocks relevant to this thread: BGL, CMM, DEG, GOR, NST, SBM, SLR and WAF. And as always, please DYOR.

Expand

This is good research JSS and yes it would be awesome if you can share valuation va the quarterly results. I hold NST, EVN, GOR, DEG.
Value at posting: $1,391.7
1 Upvote

0 Great analysis

Reply

Top Stories

LRV

Larvotto identifies new exploration target at NSW's Hillgrove, boosting shares by nearly 20%

Wealth Within weighs in on shock 4% inflation read – and stocks that could survive the gloom

AVA

Ava Risk Group expands US presence with A$0.7M Substation Deal

CMX

ChemX Materials kicks off first stage works at WA high purity alumina pilot

SS1

Sun Silver gets that drill to thrill feeling from high grade hits at Maverick Spring

SVL

Silver Mines models five new calderas close to 396Moz Bowdens deposit

RCE

Recce's R327 found effective against E.coli during clinical trial

Microcap Wrap: 5 explorers with news out today

Week 26 Wrap: Cerberus of inflation barks – rents, electricity & fuel – and world watches two elders bicker

LU7

Lithium Universe (ASX:LU7) board visits Quebec to engage key stakeholders

There are more pages in this discussion • 5 more messages in this thread...

First 2 Last

Add GOLD (COMEX) to my watchlist

SPONSORED BY