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#Boda News
Added 4 days ago
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#Broker/Analyst Views
Added 4 months ago

21-Jan-2021:  Ord Minnett: Alkane Resources: Ain’t she Boda-ful (initiation of coverage)


  1. Dylan Kelly, Senior Research Analyst, 02 8216 6417,
  2. Jack Lynch, Research Associate, (02) 8216 6368,
  • Last Price: A$0.81 ($0.85 on 22-Jan-2021)
  • Target Price: A$1.30
  • Recommendation: Buy
  • Risk: Higher
  • Sector: Gold
  • ASX Code: ALK
  • 52 Week Range ($): 0.50 - 1.50
  • Market Cap ($m): 479.3
  • Shares Outstanding (m): 595.4
  • Av Daily Turnover ($m): 2.2
  • 3 Month Total Return (%): -40.6 (that's negative 40.6%)
  • 12 Month Total Return (%): +17.5
  • Benchmark 12 Month Return (%): 13.4
  • NTA FY21E (¢ per share): 31.2
  • Net Cash FY21E ($m): 27.3

--- click on the link at the top for the full OM report on ALK ---

[I do not hold ALK currently.  I have previously.  They remain on my scorecard (as one of my smaller positions) with a 50%+ gain, despite their SP falling by over 40% in the past 3 months.]

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#Roswell Resource Updated
Added 6 months ago

04-Nov-2020:  Updated Roswell Resource lifts by 50% to 660,000oz

  • The Global Mineral Resource (Indicated and Inferred) for the Roswell Deposit has been updated after an additional 29,000 metres of drilling, and now stands at:

                           10.1 million tonnes grading 2.04g/t gold (660,000oz)

  • Total contained ounces have increased 50% from the previously announced January 2020 Inferred Mineral Resource.
  • The resource remains open for extensions at depth, with particular focus on the high-grade zones in southern Roswell, and to the west within the poorly constrained western monzodiorite.
  • Drilling is continuing in the prospective corridor to the south of Roswell and an updated Mineral Resource for the San Antonio deposit is anticipated in December 2020.
  • The resource definition drilling program at the Roswell and San Antonio prospects is ongoing as part of an extensive regional exploration program aimed at providing future additional ore feed, either at surface or underground, for Alkane’s operating Tomingley Gold Operations (TGO). The Roswell Deposit is located 3km south of the TGO mine and processing facility.
  • An underground exploration drive from Tomingley Gold Operations to the Roswell Deposit is under development. Land acquisitions have taken place and planning is underway to facilitate rapid mine development on approval.

Alkane Resources Managing Director, Nic Earner, said:

“The Roswell Resource represents the most attractive zone of broad mineralisation identified so far in the Tomingley region. This deposit, together with San Antonio, and good reserve replacement at Tomingley underground, is showing a clear pathway to achieving a further 10+ year mine life for Tomingley.

Now that resource drilling is complete at Roswell, and nearing completion at San Antonio, consultation, permitting and licencing to facilitate mining is being expedited with the relevant stakeholders and NSW government departments.”

--- click on the link above for the full announcement ---

[I do not currently hold ALK shares, but they are on my scorecard.]

Also, recently:  28-Oct-2020:  Final Assays Received for Infill Resource Drilling Roswell

And:  21-Oct-2020:  Quarterly Activities Report

These links are from the announcements page on the Alkane Resources website - see here:

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#Company Presentations
Added 8 months ago

Alkane's Corporate Presentation at the Beaver Creek Summit on 17 September 2020 is now available for download.  

[I hold ALK shares.]

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#Enters S&P/ASX300 Index
Added 9 months ago

04-Sep-2020:  S&P DJI Announces September 2020 Quarterly Rebalance

Entering the ASX300 index as from 21-Sep-2020:  ALK, CMM, DDR, DEG, EVT, REH & TPW (the following companies are being removed:  FAR, IGL, JHC, MYR, REG & SGF - all out).

Entering the ASX200:  AIA, AUB, RMS, WGX & Z1P.  (Leaving:  MMS, NHC, OML, ORE & SXL all out)

Entering the ASX100:  APX & FPH.  (Out:  CIM & VUK).

Entering the ASX20:  COL & FMG.  (Out:  SCG & SUN).

No Change to the ASX50 or to the ASX All Australian 50.

S&P/ASX All Australian 200 Index:  In:  KGN & Z1P.  Out:  HSN & JIN.

S&P/ASX All Technology Index:  Additions:  BRN, DDR, EVS, M7T, NVX, SPT, SZL, WSP.

In summary, the up-and-coming companies are mostly technology, biotechs, BNPL/fintechs, gold companies or online retailers.  And an airport (AIA), an iron ore miner (FMG), a large traditional retailer (COL) and a healthcare company (FPH). 

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#FY20 Results
Last edited 9 months ago

25-Aug-2020:  Annual Financial Results, App 4E and FY20 Statutory Accounts

Headline numbers look poor from their TGO (Tomingley Gold Operation) - with everything down except the gold price.  However, the investment thesis for ALK is all about their new Boda discovery which is the subject of an extensive drilling campaign throughout CY2020 - so we still don't know exactly how much gold they have there.  They have other tenements that contain potential commercial deposits of gold as well.

The Tomingley plant was shut down for an extended maintenance period from late December (2019) through to February (2020), which impacted production.  They have also transitioned from an OP (open pit) operation to a UG (underground) operation there, with low-grade stockpiled ore processed in the first half while underground mining development continued to progress.  Those are the main reasons why they produced less gold in FY20 than in FY19.

ALK's NTA has increased from 21.73 to 26.28 cps during FY20.  At 30-June-2020, ALK's cash+bullion+listed investments totalled $98.4m with $18.5m of that transferred to ASM when they demerged and listed in late July.

I hold ALK shares, but it's a pretty small position, as they are a small gold producer with plenty of upside, but also plenty of associated risk.  One of my main risk-management tools is appropriate position sizing, meaning that low risk companies can be larger positions, and high risk companies need to be smaller positions within my potfolios.

ALK are cashed up, so that's not a big risk, and they are producing gold profitably - with FY21 production guidance of 45 - 50 koz at an AISC of A$1,450 to $1,600/oz.  The mid-point of their AISC guidance is $1,525/oz, placing them at position #15 within my list of the 25 gold producing companies - in order of AISC - from lowest to highest, meaning that based on current guidance, ALK will have the 15th lowest costs of the 25 current Australian-headquartered pure-play gold producers we have on the ASX to choose from.

The main risk is that they don't live up to the hype - or the promise - that they don't find as much gold as the market expects during their current and future drilling programs.  That's where the main risk lies in my opinion.  And that's why they remain a relatively small position for me at this point.

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#Livewire news article
Added 11 months ago

An interesting Livewire article explaining the increase in share price of Alkane Resources.

Disclosure, I hold Alkane.

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#Bull Case
Added one year ago

Southern step out hole released yesterday. Biggest and highest grade hit to date. Still haven't found the core so could get richer at depth too. Looking like another Cadia East. Going to be a monster.

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