Gold Road Resources Limited

Construction at Gruyere Remains on Track: Gold Road Resources Limited (ASX: GOR) is an Australian gold exploration and development company based in West Perth, Western Australia. It has recently presented its business prospects at the Diggers & Dealers mining forum and highlighted about its strategy for the future. According to the presentation, the construction at Gruyere remains on track to produce first gold in 1QCY19 and it plans to return cash flow to shareholders once Gruyere is fully ramped up and generating strong cash flows. As of now, the management focuses on the more advanced southern exploration prospect, Smokebush, which has now been shown to have strike extents of approximately 1.3 kilometre and is showing strong resource potential. GOR expects the southern tenements to show the strongest potential to add to a second production center at Yamarna. On the financial front, the current ratio substantially increased from 5.25x to 13.97x in 1HFY18 from the previous six months.


Peer Group Analysis in terms of Mines (Source: Company Reports)

In another release on ASX, the company informed the market that in October 2017, Cygnus entered into earn-in joint venture agreements with Gold Road over Cygnus Gold’s Lake Grace and Wadderin Projects. As per the agreement, Gold Road will earn up to a 75% interest in the ~3,400 square kilometers area of Cygnus’ Wadderin and Lake Grace exploration projects by spending $3.7 Mn over four years. Cygnus is initially managing the exploration programs on these projects. Following this, Cygnus Gold has recently completed first pass surface sampling and ground gravity over high ranking targets on the Lake Grace Project. It will start drilling activity in the coming months. The group has also announced about the CEO transition with the appointment of Duncan Gibbs, slated for September 2018. Meanwhile, the share price has fallen 14.38 per cent in the past three months and down by 0.76 per cent on August 15, 2018, owing to lower gold price. We maintain our “Hold” recommendation on the stock at the current market price of $ 0.650, considering exploration momentum on its prospective southern tenement area and construction at Gruyere which remains on track.
 

Perseus Mining Limited

Exploration Update at Cote d’Ivoire: Perseus Mining Limited (ASX: PRU) has recently provided an update on its exploration activities at its Sissingue and Yaoure properties, both located in Cote d’Ivoire. As per the release, exploration at Sissingue, Perseus’s second gold mining operation is now slated for extension of the current estimated five-year mine life by identifying additional JORC resources. Following this, the recent exploration drilling has identified open-ended gold mineralization extending over 200m of strike length at the Zanikan prospect, south of Sissingue, and over 300m of strike length at the Fimbiasso South prospect on the near-by Mahale exploration licence. Both prospects are located within trucking distance of the recently commissioned Sissingue processing facility.

At Zanikan, the company has completed 30 air core drill holes for 1,983m to cover an area of strong gold-in-soil anomalism and extensive artisanal mining of gold mineralised quartz stockworks. As a result, three holes from this program returned significant results, including 61m @ 1.11g/t from surface which ended in mineralisation, 12m @ 1.27g/t Au from 32m, including 4m @ 2.3g/t, and 4m @ 3.42g/t Au from 48m. It indicates multiple steeply west-dipping mineralised structures over an open-ended 200-meter strike length. As per the management, the drilling at Yaoure has produced strong results and the next priority is to enhance the project’s appeal to prospective financiers. However, the remainder assay results are expected by the end of August 2018 and will be used to update Yaoure’s Mineral Resources and Ore Reserve estimates. This work is expected to be completed by late in the September 2018 Quarter.


Assays received at Yaoure (Source: Company Reports)

On the financial front, the current ratio stood at 1.23x in 1HFY18 while debt-to-equity ratio increased from 0.03x to 0.09x during the same period from the six months. Meanwhile, the share price has fallen 23.16 per cent in the past three months as at August 14, 2018. Hence, we maintain our “Hold” recommendation on the stock at the current market price of $ 0.355, considering foregoing exploration activity at its Sissingue and Yaoure properties.
 

Dacian Gold Limited

Decent Outlook: Dacian Gold Limited (ASX: DCN) has presented its business prospects at the Diggers & Dealers mining forum and highlighted about business objective for FY18. It was presented by Mr. Rohan Williams – the Executive Chairman & CEO. As per the presentation, the group raised $48 Mn capital in July, to fast-track organic growth. Moreover, it has completed project construction of $200 Mn on time and on budget during the period. During the June quarter, it produced 34koz of gold at Mt Morgans, but declaration of commercial production is not anticipated until December quarter 2018, so costs and production details are not formally set out.

On the other hand, the group confirmed plans for 180-210 kOzs production in FY2019, with gold output weighted towards 2HFY19 and indicated that all costs are to be capitalised during ramp?up ahead of declaring Commercial Production. It holds a land position in the Laverton goldfields with several avenues being pursued to deliver organic growth. As at July 2018, the company had case reserve of $97 Mn with project facility of $150 Mn (of which $140 drawn).


Business Prospect for FY18 and FY19 (Source: Company Reports)

Meanwhile, the share price tumbled 8.01 per cent in the past one month as at August 14, 2018 and is trading close to above average of 52-week level. The stock plunged 4.16 per cent on August 15, 2018 due to fall in gold price. Hence, we maintain our “Hold” recommendation at the current price of $ 2.515, despite decent outlook ahead with the support of foregoing activities.

Disclaimer
 
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated pages are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.