RMS produced a record 293koz in FY24 at an AISC around A$1,560/oz. The record result was driven by strong output from Mt Magnet and Edna May. We see further growth in Mt Magnet in FY25, however, not enough to offset the end of life at Edna May, with group production forecast to decline to 267koz. A declining grade profile at Mt Magnet sees RMS’s gold production fall back to 135koz by FY28. The acceleration of the Rebecca/Roe project or the Stage 3 cut-back at Edna May could partially offset the declining production outlook. However, following the recent purchase of a 17.9% interest in Spartan Resources (SPR AU, HOLD), we believe growth through acquisition is likely to remain a key strategy for RMS. We are resuming coverage with a HOLD rating and set a A$2.20 price target.
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