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Highlights

  • In FY24, WGX’s net profit surged 852% YoY to AUD 95 million
  • Van Eck Associates increased shareholding in WGX to 7.97% from 6.87% (as of 20 September 2024)
  • FY25 Production guidance increased to 400k – 420k ounces (up from 220k – 235k ounces in FY24)
  • FY25 to see high investments with asset integrations and expansions
  • Exploration investment of AU$50 million planned for exploration in key regions and targets

Westgold Resources Limited (ASX:WGX) is a gold exploration, development and mining company with operations focused in the Murchison and Southern Goldfields regions. In the latest financial year, ended 30 June 2024, the company witnessed awhopping 852% YoY surge in its net profit after tax to AUD 95 million and 760% YoY jump in the free cash flow to AUD 86 million.

Meanwhile, revenue increased by 9% YoY to AUD 716 million, supported by 23% rise in the gold price and reduction in hedging exposure. This was partly offset by reduction in gold sales because of lower production from the paused mining at Paddy’s Flat.

Strategic stake increased by major shareholder

The top 10 shareholders of WGX have approximately 33.73% of the firm's shareholding, while the top four shareholders have 23.10% stake. The largest stakes are held by L1 Capital Pty Ltd. at approximately 8.07% and Van Eck Associates Corporation at around 6.87%. Notably, on 26 September 2024, WGX announced that Van Eck Associates Corporation and its affiliates increased their voting power in the firm to 7.97%, up from 6.87% as of 20 September 2024.

The increase in shareholding by one of the largest shareholders often suggests that major investors foresee growth opportunities or favourable developments within the company. It is worth mentioning that on 26 September 2024, WGX shares gained 2.93%, with over 8.4 million shares traded.

Additionally, The Vanguard Group, Inc. and its related entities have also entered the company as shareholders, acquiring a 5.006% voting power as of 20 September 2024.

Optimistic production outlook for FY25

For FY25, WGX shared an optimistic outlook, bolstered by an expanded footprint across two of Western Australia’s most productive goldfields. The company has increased its production guidance to an impressive 400,000 – 420,000 ounces, a significant rise from the previous year's  220,000 – 235,000 ounces. Production enhancements in the second half of FY25 (2HFY25) are expected as key operations, including Beta Hunt, Bluebird - South Junction, and Great Fingall come online.

Additionally, the all-in sustaining cost (AISC) guidance for FY25 has been decreased to AU$2,000 – 2,300 per ounce, compared to AU$2,100 – 2,300 per ounce in FY24.

Peak investment year ahead for WGX

FY25 is expected to be a peak investment period, with the integration and optimisation of Southern Goldfields assets, the initiation of production at Great Fingall and the expansion of Murchison operating assets.

Data source: Company update

Share performance of WGX

WGX shares closed 2.93% higher at AUD 2.81 apiece on 26 September 2024 with a market cap of AUD 2.57 billion. In the last one year, WGX’s share price has increased by 69.28%, while in the last three months, it has surged by 16.12%.

52-week high of WGX is AUD 3.075, recorded on 22 August 2024, and 52-week low is AUD 1.545, recorded on 5 October 2023.

WGX Daily Technical Chart, Source: REFINITIV

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 26 September 2024. The reference data in this report has been partly sourced from REFINITIV.