Western Areas Ltd (ASX: WSA)

Returning to underlying profitability: Despite releasing a decent half year result for period ending 31 December 2017, Nickel miner, Western Areas’ stock was down 2.7% on February 20, 2018. The group reported its interim net profit to be up over sixfold to $3.51 million while revenue in the six months ended December 31, 2017 was up 2.1% to $115.81 million despite mill production and sales volume being slightly lower. The group’s NPAT increased to A$3.5m with gains on Bluejay Mining equity sale. The group was able to deliver improved result despite the volatile commodity prices. However, the group did not declare any half year dividend as per the policy of last year. On the other hand, the group is confident that the first half is on track to help meet all full year operational guidance metrics. WSA has a strong balance sheet with cash at bank of A$132.6m, supplemented by a further A$21.5m in receivables and Kidman equity position of A$32.8m. WSA expects growth to fall in line from its Mill Recovery Enhancement Project (MREP) and the Odysseus Project. We maintain a “Hold” on the stock at the current price of $3.17
 

Financial Performance (Source: Company Reports)
 

Regis Resources Ltd (ASX: RRL)

Excellent first half performance: Regis Resources edged slightly up with the release of record half year net profit after tax of $84.6 million for the six months ended 31 December 2017 (H1 FY18) and this is a 39% increase to the $61.0 million net profit after tax reported in H1 FY17. Earnings per share rose by 42% to 17.29 cents per share and revenue was up 18% from H1 FY17 to $299.0 million with 183,846 ounces of gold sold at average price of $1,641 per ounce. RRL’s cash and bullion of $172.0 million were up after the payment of $40.3 million in fully franked dividends, $15.7 million for land acquisitions and water access licences at the McPhillamys Project and $15.7 million on exploration expenditure. The group is now on track to achieve the mid to upper end of the annual production guidance of 335,000-365,000 ounces with all in sustaining costs of $858 per ounce, below the lower end of annual cost guidance for FY18. The group is paying a fully-franked interim dividend of 8 cents a share in March. However, the stock trades at a slightly high level and looks “Expensive” at the current price of $4.10

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