Northern Star (NST) delivered a lower March Q, producing 124koz at an all-in sustaining cost (AISC) of A 1,075/oz (-4% on production, +1% on costs vs the Dec Q). Underlying free cashflow from operations was $32m (-8% from $34.9m in Dec Q). Net cash and investments increased to $439.1 (+1% Q-o-Q). Group milled tonnes fell by 6%, largely as a result of the cessation of production at Paulsens which impacted group throughput. Despite the lower production, NST is achieving record throughput and mining rates throughout the portfolio, reflecting the investment in the 600kozpa growth strategy. June Q production is now forecast at 150koz (>20% QoQ) which would see FY18 production reach the middle of the refined 540-560koz guidance range. Maintain HOLD and TP of $6.12.
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