Saracen (SAR) produced a strong June Q to close out the year with 316koz gold production at an AISC of A$1,139, ahead of revised guidance 310-315koz @ A$1,100-1,150/oz. Production for the June Q was 78.9koz at an AISC of A$1,196. The results were in-line with Argonaut’s forecasts of 316koz for the full year and 78.5koz for the June Q. Production is set to rise in FY19 with guidance set at 325-345koz at A$1,050-1,100/oz AISC, below our prior prediction of 352koz @ A$950/oz. The Company added $29.3m net mine cash flow, increasing cash and liquid assets to $118.3m at June 30 (vs Argonaut forecast of $112.7m and March 31 at $101.5m). Maintain SELL recommendation with a $1.85 target price.
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