Dacian Gold Ltd

Positive Update at Mt Morgans Gold Operation: Up 6.9% on July 06, 2018, Dacian Gold Ltd (ASX: DCN) has been able to meet its quarterly guidance in terms of gold production at the Mt Morgans Gold Operation (MMGO) near Laverton in Western Australia and has reported positive updates at the Western Australian operations. The group particularly flagged that the June 2018 quarter production target of 34,155 ounces (oz) has been achieved at the Mt Morgans gold operation (i.e., within the guidance of 30,000-40,000oz). This is Dacian’s 100% owned operation. In the June quarter, the group’s mill throughput averaged 6,600 tonnes per day (tpd) versus corresponding nameplate of 8,000 tpd. Further, gold recovery of 91 per cent and an average combined treatment grade of 1.9 grams per tonne (g/t) of gold were among other highlights.

With this, FY2019 production guidance of 180,000?210,000 ounces has been reaffirmed by Dacian. Now, the group is moving towards the commercial production target set aside for the December quarter 2018. The group says that the mine and plant are operating in line with the expectation and commitments.

It is worth noting that the group is on track on its aim to become the next Australian mid-tier gold miner. The group forecasts to be producing at ~200,000oz per annum for at least 10 years, at the back of enhanced cash flow profile with support coming in from organic growth encircling its prospective tenements in Western Australia.

As at June quarter, cash and cash equivalents position of the group has been $73 million which is same as at March quarter, before creditor payments (about $18 million). We maintain a “Hold” on the stock at the current price of $ 2.930, as at July 06, 2018, while the stock has otherwise moved up about 39.4% in last one year.


Dacian Gold’s Targets (Source: Company Reports)

 
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