[I hold SAR shares]
8-July-2020: Trading update - June quarter
Another positive update from Saracen (SAR). As US stocks fell overnight, gold futures jumped to as high as US$1810.80/oz and last traded at $1807.60/oz. Spot gold remained just below $1800/oz but still reached an eight-year high. Australian dollar spot gold was trading at A$2582/oz, well below recent highs due to the strength of the Australian dollar, which last traded at US69.48c. But gold is still heading in a north east trajectory.
SAR: Record FY20 production and cash flow
Net cash of A$48m at 30 June, up from net debt of A$21m at 31 March
Saracen Mineral Holdings (ASX: SAR) is pleased to announce record production and cash flow for the year to 30 June 2020. Group gold production of 520,414oz for FY20 was ahead of guidance of +500,000oz.
In response to COVID-19, Saracen flagged the potential to prioritise the milling of higher grade portions of the stockpiles at Carosue Dam and Thunderbox in the June quarter (see March quarterly report, 28 April 2020). However, COVID-19 ultimately had a limited impact on the business and therefore this plan was not implemented and Saracen continued to execute its long-standing ‘futureproof the business’ strategy.
Managing Director Raleigh Finlayson said the results reflected Saracen’s ongoing success in meeting or exceeding guidance and in generating growth. “We have now met or exceeded guidance for seven straight financial years,” he said.
“We are also meeting our undertakings to continue driving growth and we expect this to be clearly evident in our strong news flow over the coming months.”
This news flow will include the June quarter report, Carosue Dam and Thunderbox update, FY20 financial results, and KCGM update. Each update will include drill results, Resources and Reserves, and production and cost outlook.
--- ends ---
Plenty of news flow over coming weeks from SAR, Australia's 4th largest pure-play gold producer. By "pure-play", I mean over 70% of their total production is Au (gold). So companies like IGO, SFR, OZL and BHP are not included, because they produce gold as either a byproduct of other production or else gold is not their main game. Our largest 4 pure-play gold producers are NCM, NST, EVN & SAR. I hold 3 of those 4 - all but NCM.
It's a GOOD time to be holding quailty gold producers, particularly if bought at lower levels.
--- click on link above for more ---
[Disclosure: I hold SAR shares]
[I hold SAR shares]
On the back of yesterday's positive H1 report, Saracen have announced some positive drilling results today, including intercepts of up to 19.3 grams/tonne (g/t) Au (gold) at Safari Bore (open pit-able drill results). They're also finding more gold at Karari - Dervi, at their Atbara discovery (just 4km from the Carosue Dam mill), and at Otto Bore (part of Thunderbox). I hold SAR shares.
Disclosure: I hold SAR as part of my "Big 5", which also includes NST, EVN, SBM & RRL. At the smaller end, I also hold PNR.
17-Feb-2020: Saracen continues run of strong growth in profit
Saracen continues run of strong growth in profit and cashflow with more to come
Underlying NPAT up 84% to A$80m from production of 216,452oz; FY20 guidance +500,000oz
Saracen Mineral Holdings (ASX: SAR) is pleased to announce that it recorded further strong growth in production, cashflow and profit in the six months to 31 December 2019.
The result, which included a one-month contribution from the KCGM Super Pit, was underpinned by production of 216,452oz, a rise of 22 per cent from the previous corresponding period.
Saracen is on track to meet its FY20 production guidance of +500,000oz. This includes allowing for a seven-month contribution from the Super Pit. Guidance for FY21 will be published early in the September quarter 2020, following updated Resources and Reserves.
In the six months to December 31, underlying NPAT increased 84% to A$80.2 million. This came on the back of a 45% jump in sales revenue to A$409.9 million and increased gold sales of 206,277² ounces (PCP: 167,095 ounces) at an average sale price of A$1,984/oz. One-off transaction costs of A$10.8 million (net of tax) were incurred on the Super Pit transaction and expensed in this period.
EBITDA³ increased 71% to A$178.6 million (underlying EBITDA A$194.4m) and statutory NPAT increased 61% to A$69.1 million.
Saracen Managing Director Raleigh Finlayson said the results showed the Company was in the midst of a strong growth phase at all levels of its business.
“The key message from these results is that Saracen has continued to grow and will continue to grow,” Mr Finlayson said. “We are growing production and our inventory through a financially-rewarding combination of aggressive near-mine exploration and prudent acquisition, all within 300km of Kalgoorlie.
“With the addition of the Super Pit and the Carosue Dam mill expansion set for commissioning in the December quarter, our production and cashflow is poised to continue growing.
“We are also looking forward to the results of the review we are undertaking at the Super Pit, which is a world-class asset with an exceptional future.”
Mr Finlayson said the acquisition of a half-share of the Super Pit for US$750m in November last year had seen the Company emerge with a vastly different production profile, cashflow projections and balance sheet.
“Saracen has shifted to another level in the league of global gold producers with the key benefits that brings for scale, asset diversity and cashflow,” he said.
“But we still have a desire to maintain a conservative balance sheet and therefore we are placing a strong emphasis on debt reduction.
“As part of this strategy, we have made the decision not to pay a dividend in relation to this half year. In line with our stated policy, the Board will revisit this matter at the end of the financial year.”
[continues... click on link above for more]
I hold SAR shares.