Gold Road Resources Ltd

GOR Details

High?grade bedrock mineralisation at Ibanez: Recently, Gold Road Resources Ltd (ASX: GOR) has announced bedrock drilling results from its follow?up diamond drilling at the Ibanez prospect within the Pacific Dunes?Corkwood Camp. Diamond drill hole 17CWDD0015 returned an intersection of 8.20 metres at 11.63 g/t Au from 229.67 metres including 3.33 metres at 27.48 g/t Au from 232.66 metres, 20 metres to the north?west of RC hole 17CWRC0037 (10 metres at 28.67 g/t Au from 240 metres, including 2 metres at 136.57 g/t Au from 240 metres). The hole successfully confirmed the width and grade of high?grade mineralisation intersected in the Reverse Circulation drilling. The Ibanez prospect, located on the 100% owned Gold Road North Yamarna tenements, is hosted within the Yamarna Greenstone Belt, approximately 65 kilometres north of the Attila – Alaric Trend. Importantly, the prospect was identified as the highest priority target for bedrock drill testing by the company during its annual exploration targeting and ranking exercise while it continues to deliver significant result. The group has also increased its Attila and Alaric Mineral Resources by 55% while Gruyere project has secured production pathway. Though the group faces challenges from gold price volatility, GOR stock has rallied over 21.9% in the last six months while it is up 12.1% in the past one year (as of September 20, 2017). We maintain a “Buy” recommendation on the stock at the current price of $ 0.68


GOR Daily Chart (Source: Thomson Reuters)

Silver Lake Resources Ltd

SLR Details

Strong operating cash flow: Silver Lake Resources Ltd.’s (ASX: SLR) stock plunged 4.6% on September 21, 2017 at the back of gold price sinking. For FY17, SLR reported revenue of $227.5 million (2016: $209.5 million) while generating operating cash flow of $64.0 million (2016: $55.0 million). EBITDA (before significant items) increased by 23% to $70.0 million (2016: $56.7 million) due to 3% increase in gold sales from the Mount Monger Camp (137,000 ounces compared with 132,400 ounces in FY2016), which in turn led by an increase in open pit production following commencement of the Majestic open pit mine in FY2017. However, profit after tax for the year declined to $2.0 million against $4.4 million in the corresponding period.

Importantly, the focus on production and exploration activity of the company’s core Mount Monger Camp, together with an increase in EBITDA margin resulted in a 16% increase in operating cash flows. The strong operating cash flow result, together with proceeds from the disposal of non-core assets, resulted in a 62% increase in cash and bullion to $69.1 million (2016: $42.6 million). During the year, a total of $18.5 million was invested in developing the Maxwells underground mine and Imperial/Majestic open pits, with $13.2 million spent on exploration. For FY2018, the company expects gold sales of 135,000 to 145,000 oz. and group AISC in FY2018 is expected to be similar to FY2017 with the development of the Cock-eyed Bob mine (Q1) and the Aldiss mines (Q4) initially contributing to a higher unit cost as the operations ramp up to target rates. Given the volatility prevailing in global equity markets and commodity price movements, we give a “Hold” recommendation at the current market price of $ 0.41


SLR Daily Chart (Source: Thomson Reuters)

Perseus Mining Ltd

PRU Details

Strengthened its board of Directors and senior management team:Perseus Mining Ltd (ASX: PRU) witnessed a stock price slump of 7% like other gold miners. The group recently announced new appointments to strengthen its board of Directors and senior management team. Ms Sally-Anne Layman has been appointed to the role of non-executive director of Perseus with effect from 13 September 2017 and assumed the role of Chairperson of the Board’s Audit & Risk Committee and the Remuneration Committee. She was a non-executive Director and Chairman of the Audit and Risk Committee for listed mining technology company, Imdex Limited, and a non-executive Director of West Australian focussed gold miner, Gascoyne Resource Limited. For FY17, the group highlighted a slow start but achieved a turnaround in operating performance in the second half. There was a 32% rise in production from its Edikan Gold mine in the second half over the preceding six months to December. Higher output at Edikan and commencement of production at Sissingue are expected to drive enhanced gold production in FY18. Given the recent moderate financials, and improving resource and production outlook with reduction in costs, we give a “Buy” recommendation on the stock at the current market price of $ 0.32


PRU Daily Chart (Source: Thomson Reuters) 

Dacian Gold Ltd

DCN Details

MMGP (Mt Morgans Gold Project) is the sole focus: The MMGP (Mt Morgans Gold Project) has been Dacian Gold Ltd.’s (ASX: DCN) sole focus since its IPO on the ASX in November 2012. During the FY2017, Dacian completed the bankable feasibility study delivering an initial 1.2-million-ounce Ore Reserve, the expansion PFS, the project financing, equity financing and the commencement of construction and underground mining at the MMGP. Notably, the company’s objective is to develop the MMGP into a leading, high-margin, long-life goldfield, with first gold production in Q1 of CY2018. In addition, Dacian Gold will maintain aggressive exploration programs at the MMGP to realise the undiscovered gold endowment that company management believes exists within the MMGP.


Dacian Gold’s Mt Morgans Project Area in Western Australia; (Source: Company reports)
 
The MMGP Feasibility Study had confirmed a technically and economically feasible gold project beginning its life with an initial Ore Reserve of 18.6Mt @ 2.0g/t Au for 1.2Moz over an 8-year period with an estimated average AISC of A$1,039/oz (US$779/oz). The MMGP is essentially a large underground mining complex at Westralia and a single large open pit at Jupiter, with a new 2.5Mtpa CIL treatment facility. Of the initial Ore Reserve, Jupiter contributes approximately 80% of the tonnage feed to the treatment plant for 54% of the ounces. Correspondingly, of the initial Ore Reserve, the underground mines contribute 46% of the ounces to the treatment plant and only 20% of the tonnage. Given the high-grade and high-margin nature of the Westralia Mine Area ores, all material mined from the Beresford and Allanson underground mines has been prioritised as early production sources in the mining and treatment schedules to maximise the cash-margin from the early stage mining at Mt Morgans. We maintain a “Speculative Buy” on the stock at the current price of $ 2.14


DCN Daily Chart (Source: Thomson Reuters)

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