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# March 2024 Quarterly Results

raymon68

Added 6 days ago

Cash and equivalents of $146.2M on 31 March 20241

Free cash flow generated of $5.5M during the quarter despite rain impacts

Listed Investments valued at $469M on 31 March 20242

1.0 cent per share ($8.9 million) fully franked dividend returned to shareholders following record financial year (CY2023)

GOLD ROAD RESOURCES LIMITED (ASX:GOR) - Ann: Investor Presentation - March 2024 Quarterly Results, page-1 - HotCopper | ASX Share Prices, Stock Market & Share Trading Forum

Return (inc div) 1yr: -8.01% 3yr: 9.05% pa 5yr: 12.86% pa

#2023 Sustainability Report

raymon68

Added 4 weeks ago

This year we have begun to align our reporting with the International Financial Reporting Standards (IFRS) S1 and IFRS S2, the new sustainability reporting standards issued in 2023 by the International Sustainability Standards Board (ISSB).

#December 2023 Quarterly Result

raymon68

Added 3 months ago

Investment portfolio market value ~$465M* Strategic 19.9% in De Grey Mining Prospective Greenfields exploration portfolio

a look bigger picture..

$US curreny Gold

Au up around historic highs..

Need to check this vs $AUD currency ..What do think?

GOR seems reasonable value.. 'GOR has dipped a little here.

LGold is mostly traded on the OTC London market, the US futures market (COMEX) and the Shanghai Gold Exchange (SGE). The standard future contract is 100 troy ounces. Gold is an attractive investment during periods of political and economic uncertainty. Half of the gold consumption in the world is in jewelry, 40% in investments, and 10% in industry. The biggest producers of gold are China, Australia, United States, South Africa, Russia, Peru and Indonesia. The biggest consumers of gold jewelry are India, China, United States, Turkey, Saudi Arabia, Russia and UAE. The gold prices displayed in Trading Economics are based on over-the-counter (OTC) and contract for difference (CFD) financial instruments. Our gold prices are intended to provide you with a reference only, rather than as a basis for making trading decisions. Trading Economics does not verify any data and disclaims any obligation to do so.

Valuation of $1.640

Bear77

Added 7 days ago

Scroll down - latest updates are at the end:

2019: Old price target was 80c. They've blown through that.

New price target = $1.20. They're already above that, but I'm not sure they're worth $1.30 to $1.40 - where they're at currently. I don't own any GOR shares.

28-Jan-2020. OK, new PT = $1.60, provided A$ gold price stays over $2,200/oz. I don't follow GOR closely, and still don't hold any, but I recall that they had/have plenty of gold, mostly low-grade, but close to surface and easy to get at and cheap to process. Now that they are producing successfully, with no major headaches or bottlenecks in the processing plant during the ramp-up phase apparently, I think they will start to appeal to a wider audience. I note they're now in the ASX200 and therefore BlackRock and Van Eck are both substantial holders now (with each of them owning 8% to 9% of GOR). GOR have the potential to become a similar gold miner to Regis Resources (RRL), who also have relatively low grades, but similar low costs because the ore is so easy to get at and cheap to process. Regis has been a wealth winner for their shareholders for a long time now, with many more years left to go. They're no Northern Star (NST), but they're still pretty decent. However, it's worth remembering that GOR only own 50% of Gruyere - with Gold Fields owning the other half. Gold Fields Limited is one of the world's largest gold mining firms. Headquartered in Johannesburg, South Africa, the company is listed on both the Johannesburg Stock Exchange (JSE) and the New York Stock Exchange (NYSE). There is always the possibility that Gold Fields could at some point look to buy out GOR, but then the latest trend is for larger goldies that are based and listed outside of Australia to actually divest their Australian mines. Most of them are now focussed elsewhere, like Canada. But I digress. Must be the red wine. GOR will probably go higher. They've broken through my last two price targets, so here's my new one. Let's see if they can get to that one.

28-July-2020: Yep, they blew through that $1.60 price target also. The rising gold price has a lot to do with it. My new PT is $2.20. It's not very ambitious, and it's based on nothing more than momentum really, but I think they can get there. I've had a close look at GOR a few times in recent months, but still don't own any. I hold a heap of others though.

27-Jan-2021: Adjusting PT down due to sentiment shift since July/Aug last year. I added RMS and GOR shares to my SMSF portfolio in the second half of 2020, and I like Gold Road (GOR) for a number of reasons but particularly for the vast exploration upside potential in their extensive tenements. And their market leading low AISC (All-In Sustaining Cost per ounce of gold produced). However the market isn't too interested in them at this point, so a lower PT seems warranted. $2.20 is still OK for a 5-year view, so by January 2026. My one year PT is now $1.77.

04-Aug-2021: Update: Happy with $1.77. No change to the investment thesis. Still holding GOR in my super, and on my Strawman.com scorecard/portfolio.

12-Feb-2022: Update: Marked as stale again, but I don't think I need to change that price target. I had set that $1.77 PT as a 12 month PT back in January 2021, so to occur by 27-Jan-2022, and that didn't happen. GOR got up to $1.67 in November, but that was 10 cents short of my PT. The gold price ran out of steam and has been tracking sideways mostly, a little up, a little down, but no strong trend in either direction of late. It wouldn't take much to see GOR back over $1.77; they reached $1.90 in July 2020. I'm happy with that PT, and I still hold Gold Road shares both here and in my SMSF. No change to the investment thesis. Same PT, but new timeframe - so... by March 2023. That would be a 30% return from the $1.36 level they closed at today. I'd be happy with that. I think they'll get there. I've just got to be patient. One foot in front of the other... Down that yellow brick road.

17-April-2024: Update: I haven't updated this one for over two years - and my thinking has changed. GOR have been above my previous $1.77 price target multiple times in the past year, however I sold my GOR out of my SMSF today and also out of my Strawman.com portfolio. I thought there were going to buy something, but I really didn't want them to go offshore, as NST did with Pogo and EVN did with Red Lake. GOR's interest in Greenstone Gold Mines in Canada was leaked (probably by a rival bidder) to the media prompting this response by GOR: Response-to-Media-Speculation.PDF

Looks like Gold Road were angling to buy the 40% of Greenstone that is owned by Orion Resource Partners. TSX-listed Equinox Gold (EQX.tsx) own the other 60% and are the mine's operators, so if this one went through, Gold Road would be the junior partners - and non-operating partners - in two mines, Gruyere in WA (majority owned and operated by South African based Gold Fields), and Greenstone in Ontario, Canada (where Equinox would remain the majority owners and operators).

Greenstone is a BIG gold project.

According to The Australian, on Monday (15th April 2024), Orion is seeking a A$1 billion-plus (about US$648 million) valuation for Greenstone from Gold Road Resources and the article in The Australian suggested that GOR would require a "monster capital raising" if they were to proceed with the acquisition, which seemed to spook the market.

Gold Road’s shares dropped 6.6% to A$1.70 by the end of Monday’s trading, surpassing the losses seen by other gold companies. This movement in the stock price suggests that investors are, in fact, expecting a fundraising effort.

Gold Road had A$143.8 million in cash and A$465 million in investments by the end of 2023, with a significant portion represented by its 19.9% stake in gold company De Grey Mining (ASX: DEG).

Shares in De Grey also fell by 4.7% on Monday, further suggesting that some market players believe Gold Road may sell its stake in De Grey to generate the necessary funds to acquire Orion’s 40% in Greenstone Gold Mines.

Greenstone owns a portfolio of pre-production gold claims in Ontario, including its namesake flagship open-pit gold project. The mine, scheduled to begin production in May, is expected to produce approximately 400,000 ounces of gold per year.

Source: https://www.mining.com/gold-road-seeks-stake-in-greenstone-gold-mines/

The Money of Mine (MoM) lads covered this very well on their show on Monday:

And, yeah, nah, I'm out.

Plenty of good management teams doing more sensible things in the Aussie Gold Sector at this point in time, and I'm invested in a few of them, so don't see any reason to remain in this one any longer.

#GOR takeover of DGO Gold

stale

Tom73

Added 2 years ago

GOR takeover of DGO Gold (4/4/22)

GOR announced today the off market takeover of DGO Gold (DGO) in an all script offer of 2.16 GOR shares for each DGO share or around $3.55 a share (A$308m). DGO is currently at $3.00 but has been as high as $3.90 in the last year.

DGO assets include listed holding with a market value of A$273m (14.4% DEG, 6.8% DCN, 20.1% YRL) and “an attractive portfolio of exploration tenements in the Pilbara, Yilgarn, Bryah and Stuart Shelf Provinces”.

The price looks to be ballpark reasonable, also as a script offer the large cash balance remains intact providing support to future dividends. However, on a shareholder value basis the dilution may be more costly over the long term.

The DGO board supports the offer and 80% of shareholder support is needed for the deal to proceed.

The GOR board have been hunting acquisitions, so this is no surprise, they fell short on offers for 2 last year so appear to be reasonably conservative on pricing to protect shareholder value. The expansion of it’s holdings in both exploration assets and production assets is making GOR more complex from a valuation prospective which will lead to a discount on the market.

Having just updated my valuation I am not making any changes given the acquisition price seems around fair value.

Gold-Road-Makes-Recommended-Takeover-for-DGO-Gold.PDF

Disc: I own GOR

Valuation of $1.500

stale

Tom73

Edited 2 years ago

Mar22 Valuation

See "FY21 Results & Valuation Review" straw for details:

Valuation Adjustments:

· $1.50 from $1.36 (Mar21)

· Gold price changed from US$1700 to US$1900 in FY22 (FX0.80 unchanged for A$2,375 price) and AISC to align with management expectation for FY22 (mid point $1,370) and to grow both at 4% rather than 2% inflation previously used.

· Extended and adjusted Gruyere mine output and AISC to mid-point of management’s expectations and for the additional life and production (stages 6 & 7 added).

· Retain an assumption that ignores exploration spend and potential cash from exploitation of new discoveries. Assume this net off and at the end of the Gruyere mine provide a perpetual replacement. Note about $0.75 of my valuation is the Gruyere mine for the current life through to 2032, above that is cash (15c) on hand and terminal value assumptions (60c) of replacement production into perpetuity.

Valuation Sensitivity: different values for different key assumptions

· $2.33 if FY22 Gold price is A$2,850 (US$2000 @ 70c)

· $0.90 if FY22 Gold price is A$2,000 (US$1800 @ 90c)

Mar21 Valuation

Gold Road is the first gold miner I have been interested in enough to value, which shows both my prejudice against them and inexperience in valuing them. As such I will walk through my logic in detail, which comes down to 3 key factors (Details in Straw): 1 Gold Price in A$ The sticking point for miners is that they mine a commodity and have no control over the price and it is difficult to predict. Hedging can be used over short periods, but the company valuation is based on many years past what can be hedged. So, I have make a call on the likely A$ price of gold, which means estimating FX rates and US$ Gold prices… Get this wrong by much and everything else doesn’t matter. I have assumed an average gold price of A$2,125 per oz, which assumes an average FX rate of US$0.80 to A$ and average gold price of US$1,700 per oz. The FX rate is around long-term average and current rate and the US$ gold price is US$300 less than recent highs but high for recent years. With a lot of money printing, inflation may lead to higher gold prices in coming years, so I feel there is a higher floor for gold prices than has been the experience over the last decade. 2 Current Opportunity Valuation This is the value of verified and probable deposits GOR is currently mining and as such likely cashflows can be calculated. GOR is in production via a JV at Gruyere which has a 10 year life based on 3.2Moz of gold, of which 50% is attributable to GOR. AISC (All-in Sustaining Costs) to mine it are expected to be around A$1,300 with up to 0.35Moz mined each year. Assuming an average sale price of A$2,125 per oz, A$10m a year in additional costs or other capex and 27.5% tax, with prices and costs increasing at 2% a year. Cash of $935m is generated with a PV of $583m at a 10% discount gives a value of $0.65 a share. Note this moves a lot if we change gold price assumptions. An FX rate of 0.7 and US$2,000 gold price increases the value to $1.29 (double), but an FX rate of 0.9 and US$1,500 gold price decreases it to just $0.25 (a third). I fully expect that in the next 10 years we will have both of these FX and price situations… So if we accept $0.65 as a fair value for the current operations and add cash on hand of $0.14 a share we get a base IV of $0.79. 3 Future Opportunity Valuation This is where we estimate new discoveries or the “recycle-ratio” for minable deposits and value future opportunities. Management point out that the current operations at 50% JV Gruyere site have potential beyond the current 10 years and 3.2Moz identified deposits. An addition $27m will be spent in 2021 exploring other sites owned by GOR including Goldern Highway Satellite pits which has 0.31Moz of proven and probable ore reserves and is 100% owned by GOR, as well as Yamarna also 100% GOR owned. In all there is another 1.0Moz of Measured, Indicated and Inferred gold deposits across existing sites and many of these are close enough to the Gruyere JV site to piggyback off processing capacity there, hence will require lower capex to tap. So I am going to assume that GOR can perpetually replace the maximum 175Koz (50% attributable to GOR of 350Koz) of production out of Gruyeve JV from other sites or operations. Which effectively doesn’t start adding to production until 2029 when Gruyeve starts to run down, but this will give GOR a cashflow projection to calculate a terminal value. This is a very bearish assumption so to offset it I will assume that exploration costs nil, net of additional productive capacity that I would expect to eventuate well before 2029. This leaves a simple business producing 175Koz from 2023 onwards, assume a 2% increase in prices, costs and share count (ESOP) each year and we get an IV of $1.36. Hence future opportunity has added $0.57 to the share price value on relatively conservative production assumptions. Conclusions IV of $1.36 I see has a base case, with a bear valuation of $0.71 and bull valuation of $1.81. GOR is in a very strong cash position and just announced its first dividend which is a great vote of confidence on future cashflow performance. However, it’s a gold miner so FX rates, gold prices and operation as well as exploration success all provide risks and opportunities which guarantees high volatility. I have taken a position in GOR, but see this as speculative and will most likely sell if the price returns to previous highs around $2 unless this is due to exploration success and likely increased future production. In the mean time I expect a 5%+ dividend yield as a minimum.

Valuation of $1.420

stale

Hackofalltrades

Edited 2 years ago

Just doing some more ballparking on GOR. Disclosure, held in RL, though I am considering selling some or all of them. Posting as a valuation as I've been watching GOR for a while, so feel like I know the company a little better. I'm still not great at valuing mining companies.

Gruyere mine is expected to ramp up to lower guidance of 350k ounces per year (175k GOR attributable). I'm estimating a gold price of $1700 USD and conversion rate of $1.4. Estimating AISC of 1525. 10% DCR

Running this for 11 years from now gets a valuation of 645m, 15 years for 753m, 20 years for 837m. I think it likely that they will extend Gruyere by at least 4 years, so will use this middle figure of 753m. (I have ignored depreciation of machinery, which I think will add a little to this valuation)

There is then the exploration. They are spending quite a bit of money on drilling each year (somewhere in the area of 15-30 mil I think).I don't fully know how to value their exploration of Yamarna, however, I do know they are targeting a 1m oz + deposit. Assuming success in finding a 2m oz deposit that produces 200k for 10 years from 2025 (ignoring capital costs), we get an additional ~500m value generated. I'm not quite sure how to calculate the probabilities of this happening, but feel like a large deposit could be a reasonable possibility, as could not much at all.

Current assets as of half yearly were 157m, total liabilities 200m. There are plenty of non-current assets, so I'm just going to call that a zero.

753 + 500 gives a valuation of 1253m.

There has been some management instability in the last 6 months, though most people say they are competent.

Current market cap is 1.34bil, which gives a valuation of $1.42

#Mar23 Qtly Results

stale

Tom73

Added 12 months ago

Qtr Result:

82,604oz produced at Gruyere (100% basis), up from 74,201 last Qtr
AISC of A$1,399/oz, down from A$1,622 last Qtr
Net cash $127.9m, A$150m undrawn debt facility (almost all is DEG)
listed investments value A$480m at market 31/3
41,818oz sold (50% basis) at average price of A$2,764/oz Vs 37,295 @ A$2,476 last qtr.

Gruyere Outlook 2023 (100%):

340-370koz with grade increasing to 1.3g/t Au (from 1.15)
Indices that average qlty production for the remainder of the year will be up to 90,799oz at the midpoint, so 10% up on Q1 for remaining quarters.
AISC guidance A$1,540-1,660/oz.

Valuation: In line with current expectations so maintain base valuation of A$1.55 with a healthy Bull-Bear range of 2.44-0.98 and probable trim or sell over $2.

Disc: I own

#Gruyere 3 year outlook & Mine

stale

Tom73

Added one year ago

Just a confirmation and small upgrade on Gruyere mine announced this morning:

· Production range of 335-375k ozpa (100%), increase on prior years due to higher head grades and improved throughput (third pebble crusher added late 2023).

· Requires minimal growth capital

· Sustainable production at 350k ozpa reaffirmed to 2032

· >1m oz mineral resource defined, opportunity to extend mine beyond 2032

The gold price now over US$2,000 is more likely to move the price today than this news.

Disc: I own

#Valuation review on FY22 resul

stale

Tom73

Added one year ago

(31/3/23)

Reviewing my valuation taking into account the results released this month and considering the currently high A$ gold price and AISC which basically net off. As such I have not changed my valuation from around A$1.50 and view that it’s a trim or sell at $2.00 or more.

Valuation Adjustments:

· Listed Assets from DGO Gold take over: provided at 14.4% holding in De Grey Mining (DEG) which has been increased to 19.73% (308m shares, market value $460m). They own the Hemi gold project in the Pilbara which has similar characteristics to Gruyere. Other entities they have an interested in amount to less than $10m in market value (GMD, YRL, S3N). In total I have added A$467m to the EV to allow for this but the share dilution offsets it.

· Net Cash of A$74m - Debt free with a 150m facility undrawn.

· Unhedged as of Nov22 so full exposure to gold price.

· FY23 forecast production (attributable) 170-185koz at A$1,540-1,660 AISC. I have assumed 170koz at $1,660 AISC, they came in on the unfavorable side of range guidance for FY22 so I am taking worst in range to add some margin of safety.

· Gold price: Currently below A$3000/oz, I am assuming that the US$ gold price will rise but be partially offset by a rise in the A$ so allowed for a 4% a year appreciation in A$ gold prices. Below is a valuation table for variance in the A$ price from combined FX and US$ gold price moves.

I continue to assume a terminal value on the basis that current production will be replaced indefinitely, with exploration & allowance for development costs included in the valuation. There is probably some upside opportunity from all the current projects, but I will value it if and when it is more tangible.

It’s the only gold stock I own, so is my toe in the water for a spike in gold prices…

Disc: I own

#Duncan Gibbs (CEO) Ausbuz Inte

stale

Tom73

Added 3 years ago

Duncan Gibbs (CEO) Ausbuz Interview (4/8/21)

Gold Road now all clear to ramp up production on ausbiz

Interview Notes: Comments on Qtly update and Diggers & Dealers conference

· Production disruption a “speed hump”, remain confident on reaching the 350koz production

· AISC driven by production level, so once at 350koz target they will sit in lower quartile of producers for the life of the mine.

· Lab supply delays experienced but results coming through now.

· Don’t see any need for significant capital spend due to the cash positive nature of Gruyere.

· Eyes out for value accretive acquisitions but active growth pursued by exploration.

Conference Presentation (10Mb so too large to attach):

· No new big announcements of new greenfield sites unlike last year.

· Presentation doesn’t add a lot of new info, but interesting to see that Gruyere is the largest discovery in Australia since 2010 and represents over 10% of discoveries over the period.

No new news, but reassurance that production disruptions are a one off and that the 2023 production target of 350koz is still on track.

#FY21 Results & Valuation Revie

stale

Tom73

Added 2 years ago

Processing interruptions during the year impacted the result, reducing production and driving up AISC to produce a poor result compared to the prior year. Exploration outcomes extending the Gruyere mine (50% attributable) for 2 years and a 70% increase in 100% attributed deposits were the bright spots. Gold prices have improved and the A$ remained relatively stable to provide a favorable position for GOR in FY22 assuming no further production issues.

Highlights:

· NPAT A$36.8m Vs A$80.8m LY, EBITDA A$120.2m Vs A$170.6m LY,

· 0.5c fully franked final dividend (Vs 1.5c LY), Cash of A$131.5m Vs A$126.4m LY

· Production of 246.5k oz was below revised guidance of 250-260k, and last year’s 258.2k oz production due to process plant interruptions

· Guidance for 350k oz production by 2023 (100% basis) remains.

· AISC of A$1,558 /oz was above revised guidance of A$1,425-1,525 and last years A$1,273 due to lower throughput from interruptions to processing and lower plant utilisation.

· JV Ore Reserve up 28% YoY to 4.45m ounces (109.1m tonnes at 1.27g/t Au), Gruyere’s mine life extended out to at least 2032 (2030 previously)

· 100% owned Mineral Resources increase by 70% to 6.4m tonnes at 2.44g/t for 0.51m ounces via exploration projects.

· No Inorganic growth due to being outbid on 2 offers during the year.

· 2022 Guidance: 300-340oz production (100% basis), AISC between A$1,270-1,470/oz due to improved grades being mined, improved mill optimisation and maintenance practices as well as state boarder openings not materially changing the current production and costs environment.

Opportunities/Risks

· Processing interruptions at Gruyere really hit the year hard, provided these are behind GOR then FY22 should be as good or better than FY20 was.

· Inflation impacts on costs is a risk to bringing AISC down and I expect that it will come in at the high end of guidance because of it.

· Gold price and FX rates as always will be critical, I think the gold price will increase with inflation (based on cost to extract increasing). On the downside I see the A$ as a commodity-based currency holding up well in inflation and possibly acting as a headwind.

· Gruyere mine reserves up 10% at year after extraction due to new discoveries. Nice to have more in a mine at the end of a year despite taking ore out all year long! (Magic pudding). 100% owned exploration work is also providing value accretion.

· It is good to see a continuing commitment to issue dividends, which for a gold company is an important distinction. The Chairman said, “Dividends are a key mechanism of the Board’s strategy to generate and return value for shareholders.”

Valuation Adjustments:

· $1.50 from $1.36 (Mar21)

· Extended and adjusted Gruyere mine output and AISC to mid-point of management’s expectations and for the additional life and production (stages 6 & 7 added).

Valuation Sensitivity: different values for different key assumptions

· $2.33 if FY22 Gold price is A$2,850 (US$2000 @ 70c)

· $0.90 if FY22 Gold price is A$2,000 (US$1800 @ 90c)

Uncertainty around FX rates and the gold price over the long term is my key issue with GOR and I would treat a spike in price of GOR should gold spike as an opportunity to exit. A price of $2 or more without an increase in deposits would probably be an exit point.

GOR Valuation Mar22.pdf

Dics: I hold GOR

#Apollo Offer Stale

stale

Tom73

Added 2 years ago

This morning GOR announced that it will not engage in a bidding war with Ramelius (RMS) for Apollo (AOP), leaving their $0.56 a share offer unchanged in the face of RMS’s $0.34 + 0.1778 RMS shares offer (which at current price is worth about $0.54).

It is good to see they are holding the line, I was worried when they put in the offer that GOR was going the way of most miners and empire building rather than giving cash back to share holders. They still may go ahead given they have 20% of AOP if circumstances change, but I take comfort that it’s not “at any price”.

Dics: I hold GOR

#Qtly Activities

stale

Tom73

Added 3 years ago

Lower production and higher AISC figures released today (unable to attach due to size) had been flagged in the Q4 Production Update released on 28 June, but we have a bit more detail and additional information on further drilling at Gruyere but no change to attributable mineral resources like the 20% increase announce last quarter.

Q2 Results (31 Dec year end):

· Gruyere (100%) 53,132 oz gold produced, down from 66,213 oz produced in Q1 due to previously flagged disruptions (Torn conveyor delays sourcing parts and Ball mill restart delays) and also lower head grade of 0.92 g/t Vs 1.12 g/t in Q1 due to mining in lower grade areas which is expected to improve in coming quarters.

· Ore minded was actually up considerably to 2,602kt Vs 1,946kt last quarter so it was the milling and grade issues that held gold production back.

· AISC of $1,659/oz, well up on $1,386/oz from Q2 and the long term target for Gruyere of $1,300, but this was due to the above mentioned production and grade issues which “should not” be an issue long term.

· Sales of 28,425oz were low (32,100oz in Q2) and an average sale price of $A/oz of 2,145 is well below current spot prices due to 36% of sales being hedged at A$1,823/oz. About 25% of expected production is hedged out to the end of calendar 2022 at an average of A$1,874/oz so high spot price are not fully reflected in sales.

· Cash is a healthy $129m, down on Q4’s $150m due to dividend payments and tax payments pushing operating cashflows negative on lower sales.

· Gruyere 12,000m deep diamond drilling showing promise and progressing to phase 2 and we should expect an update on the Ore Reserve in H2.

· Discovery work in Yamarna details provided with some encouraging results.

The production disruptions in Q2 at Gruyere are disappointing but don’t impact my valuation thesis which assumes they will be able to get to the targeted 350Koz product levels by 2023 and average an AISC of $1,300 with an average sell price of A$2,400 through to 2030. The thesis also assumes that gold reserves can be replenished through new discoveries (Gruyere & Yamarna) to provide perpetual value and this also seems reasonable based on their drilling work to date.

I hold GOR at current prices, but would probably trim or sell if it got to $2 without additional justification for a higher valuation

#Q4 Update

stale

Tom73

Added 3 years ago

GOR production update for Q4 today (28/6/21) attached flags production down time due to equipment failures which amounts to a small profit downgrade for FY21, but only a minor drop so despite any market reaction today I am make no changes to my valuation.

· FY production remains within guidance of 260-300k ounces but at the lower end.

· AISC guidance increased from $1,225-$1,350 to $1,325-$1,475

I continue to hold GOR

View Attachment

#Valuation

stale

Tom73

Added 3 years ago

Valuation details

View Attachment

#ASX Announcements

stale

Bear77

Last edited 3 years ago

08-Dec-2020: Gruyere to Expand with Renewable Energy Hybrid Microgrid

and: APA: APA Makes First Hybrid Energy Microgrid Investment

GRUYERE TO EXPAND WITH RENEWABLE ENERGY HYBRID MICROGRID

Highlights

Gruyere JV installation of a renewable energy hybrid microgrid will increase the mine’s power capacity to enable plant throughput up to a targeted 10 million tonnes per annum (Mtpa)
Phase 1 installation of an additional 4MW gas engine by mid-2021
Phase 2 installation of a 13MW solar farm and 4.4MW battery energy storage system by the end of 2021

--- click on links for the full announcements by GOR and APA ---

[I hold GOR shares, GOR (Gold Road Resources) own 50% of the Gruyere Gold Mine in WA. The other half is owned by South-African-based Gold Fields Ltd.]

Further Reading:

https://goldroad.com.au/wp-content/uploads/2020/10/20201023-Quarterly-Activities-Report-Sept-2020_asx.pdf (23-Oct-2020)

https://goldroad.com.au/wp-content/uploads/2020/10/202010-Diggers-Presentation_ASX.pdf (12-Oct-2020)

https://goldroad.com.au/ (website)

#Reports and Presentations

stale

Bear77

Added 4 years ago

28-May-2020: 2020 AGM CEO Presentation and 2020 AGM Chairman's Address to Shareholders

Valuation of $1.810

stale

Rapstar

Added 4 years ago

Ok, my first Gold Investment (other than Yandal). I am building up a 5% gold hedge in my P/F, and GOR is part of this strategy. So, how did I value GOR? I modelled annual gold production @ 300k ounces, declining at a rate of 3% pa over ten years, with costs per ounce rising to $1550/ounce in 2024, and rising at an annual rate of 5% pa thereafter. For the price of gold, I have modelled $2000 AUD for FY2021, $2300 for FY2022, and $2500 for FY2023, and increasing at a rate of 3% pa thereafter. Note: Spot price today: $2550 AUD per ounce. Discounting 10 years of cashflow by 10% pa, I come to the valuation above. This assumes, cashflow is reinvested at rates above 10% pa, or returned to shareholders. Upsides: 1) Gold price exceeds forecast - quite possible. 2) Gold discoveries in Southern project area yield +1M ounces as targeted. Downsides: 1) Gold prices fall. 2) Capital squandered on exploration that leads to dead end. 3) Operating costs escalate at Gruyere Mine -

Gold Road Resources Limited

Gold Road Resources Limited

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Gold Road Resources Limited

Gold Road Resources Limited

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