BGL’s 3QFY24 was weak with a slight miss in production compounded by lower gold sales and higher mine development capex, which resulted in cash and bullion at the end of the quarter coming in 18% below our forecast. Stoping grades remaining below development grades was surprising as we had assumed higher stoping volumes and grades than was reported. BGL has indicated that development ore grades improved in March, and we note that our forecasts call for production in the 4QFY24 to rise to ~47koz on the back of improved grades. BGL is set to provide FY25 production and AISC for the first time when commercial production is declared in the June quarter. We believe the AISC guidance is likely to present a negative catalyst for the stock and reiterate our HOLD rating and A$1.80 price target on BGL.
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