We are initiating coverage on Ora Banda Mining (OBM) with a SPEC BUY rating and set a A$0.40 price target. The ramp up of the Riverina Underground mine should see OBM lift production from ~65kozpa to ~100kozpa by the end of FY25. The development of the Sand King underground should enable OBM to sustain theRead more
KRR released preliminary results for the 1QCY24. Gold production of 36.1koz was 9% lower than we had forecast, however gold sales of 40.3koz were 2% higher than our estimate. We note that no AISC data or a production split between Beta Hunt and Higginsville was provided with the preliminary 1QCY24 result. The slight beat onRead more
Capital intensive mining services are unpopular if trading multiples are anything to go by. This note does a deep dive into the returns, cash flow and leverage trends in recent years for Macmahon, NRW, and Perenti. We conclude the bad rap is unwarranted. Key points Weak production result: WGX announced preliminary production for the 3QFY25 of 52.1koz, 13%Read more
CMM’s 3QFY24 preliminary production result for Karlawinda was in line with our forecast. Production was down on the previous period due to major weather events that delivered 280mm of rain. CMM has trimmed its FY24 guidance range to reflect this, however, we note that the adjustment was broadly in line with our base case, andRead more
RRL has released an updated capital cost assumption for its McPhillamys Gold Project in NSW. The total capex for the project is now estimated at A$960m-A$1,055m. The capex range was 20-32% higher than our A$800m assumption. The higher capex reflected some changes to the flowsheet, which has lifted recovery rates from 85% to 88%. WeRead more
RMS’s 3QFY24 gold production of 86.9koz was a record for the company. The strong result and buoyant gold prices resulted in free cash flow generation of A$125.3m, also a record for the business, and translates to an annualised free cash flow yield of 23%. Production and free cash flow was materially better than we hadRead more
WGX produced 52.1koz in the 3QFY24, 13% below our estimates. The weaker production result was attributable to a gap between the cessation of production at Paddy’s Flat and the subsequent ramp up of the Fender underground, and inclement weather. However, we suspect that lower mined grades at Big Bell and Bluebird vs our estimates wereRead more
While unlikely to progress, today’s $2.825 bid from Hanwha has reminded investors of the interest in Austal, and for the first time an indicative share value. The recognition of Austal’s asset and contract value, current defence contractor trading comps, and tailwinds from naval defence spend in both the US and Australia supports a maintained BUYRead more
A1M has delivered an updated Reserve for the Jericho deposit with contained metal improved by 86%. While Argonaut had hoped for a higher MRE-Reserve conversion rate, we remain confident that future drilling programs will expand the mineable Reserve to backfill our inventory of 7Mt grading 1.9% Cu, 0.4g/t Au. New drilling at Swagman scheduled to beginRead more
We recently visited RED’s King of the Hills operation. The trip included viewing both the open pit and underground mines and the surface process plant and power infrastructure. Our key takeaways from the tour were the scale of the operation, which provides RED with flexibility to expand production in stages. The ground conditions of theRead more
