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Highlights

  • Alkane resources is an ASX-listed gold exploration and production firm
  • During the quarter ended 31 December 2023, Tomingley met its production guidance with gold production of 15,855oz
  • Gandel (Ian Jeffrey) has the maximum stake in the firm with a shareholding of around 18.25%

Established in 1969, Alkane Resources Limited (ASX: ALK) is a gold production company and currently it produces gold from the Tomingley Gold Operations, which has been operational since 2014. The company also holds multiple gold and copper tenements in Central West New South Wales. In this article, Kalkine breaks down most recent financials of this ASX-listed gold miner and explores the 5-year financial trajectory of the company using fundamental analysis.

The AUD 337.92 million-marketcap firm reported 15.5% YoY surge in its gold revenue to AUD 190.5 million and 5.2% YoY rise in gold production to 70,253 ounces in the financial year FY23. During the reported period, cash and cash equivalent stood at AUD 80.3 million.

Profit for the period reached AUD 42.5 million, backed by cost and production performance at Tomingley. In FY23, gold sales were 70,498 ounces, up from 66,883 ounces in FY22.

ALK December and September quarter updates

Through an ASX-filing, the company released its December quarter trading updates on 15 January 2024. During the reported period, Tomingley Gold production met guidance. Gold production for the quarter was 13,182oz and gold sales was 14,507oz. During the quarter, revenue stood at AUD 42.4 million.

The latest quarter also witnessed further exploration on Boda and Kaiser gold-copper prospects.

On 25 October 2023, the company had released its September quarter results. During the quarter, gold production stood at 15,885oz and gold sales was 16,090oz. Revenue for the period was AUD 46.6 million from quarterly gold sales.

How ALK has performed over the last 5 years

ALK's revenue has grown at a CAGR of 19.8% between FY19-FY23, while its cash from operating activities have grown at a CAGR of 27.4%. Over the last five years its operating efficiency has also witnessed improvement as its EBITDA margin has grown from 35.70% in FY19 to 50.00% in FY23. The company has negligible debt as its Debt/Equity ratio was 0.05x in FY23 and its total debt was AUD 13.50mn vs its Cash and Short Term Investments of AUD 80.30mn. Kalkine’s fundamental analysis delves deeper into the numbers reported by ASX-listed companies to bring out insightful reviews about their financial performance.

Top 10 shareholders of ALK

The top 10 shareholders of ALK have around 36.53% shareholding in the company, while the top four have nearly 27.06% shareholding. The top two shareholders of ALK are Gandel (Ian Jeffrey) and Van Eck Associates Corporation, with a shareholding of ~18.25% and ~3.36%, respectively.

Recent business update

On 17 January 2024, the company informed that Ian Gandel, chairman of ALK had sold around 8.7 million shares by pre-market block trade. Following this transaction, Gandel retains nearly 110.1 million shares in the company.

Outlook

In FY24, the company anticipates to deliver gold production of 60koz to 65koz from Tomingley. The expected range of AISC is AUD 1,750-2,100/oz.

The focus is on expanding Tomingley’s gold production, continuing exploration across its tenement portfolio and delivering scoping study for the Kaiser and Boda deposits.

Share performance of ALK

ALK shares closed 0.9% lower at AUD 0.55 apiece on 23 January 2023. With this, ALK’s share price has dropped by almost 20.86% in the past one year and has decreased by 28.10% in the last six months.

The 52-week high of ALK is AUD 0.955, recorded on 14 April 2023 and the 52-week low is AUD 0.56, recorded on 19 January 2024.

Note 1: Past performance is neither an Indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, and currency, is 23 January 2024. The reference data in this report has been partly sourced from REFINITIV.