Silver Lake Resources Ltd

SLR Details
AISC expected to decrease from Q2: Silver Lake Resources Limited (ASX: SLR) posted gold sales of 34,405 ounces at an average sale price of A$1,704/oz in the quarter ending September 2016. For FY 17, the gold sales guidance of 135,000 to 145,000 ounces remained unchanged. Moreover, Majestic Open Pit mine has started production in July and has introduced into the mill blend from September 2016. SLR’s AISC is of A$1,391/oz, which reflects the development of new mines and the processing of lower grade stockpiles in the September quarter. At Maxwells, all in-pit infrastructure has successfully commissioned during the September quarter. All the four underground mine access portals were established in August. The AISC is expected to decrease from Q2 as new mines ramp up production. Meanwhile, SLR stock rose 79.10% in the last six months (as of October 27, 2016) while we maintain a “Buy” recommendation on the stock at the current price of $ 0.61

 
SLR Daily Chart (Source: Thomson Reuters)

Beadell Resources Ltd

BDR Details
AISC per ounce cost guidance has increased for CY 2016: Beadell Resources Ltd (ASX: BDR) expects to achieve the production forecast of 145,000 to 160,000 ounces of gold for CY2016, while AISC per ounce cost guidance of US$715 to US$815 per ounce has been increased to US$830 to US$930 per ounce for CY2016.

 

September Quarter performance (Source: Company Reports)
 
BDR has reported gold sales for September quarter of totaled 39,607 ounces at an average cash price of US$1,315 per ounce. The gold production for the September 2016 quarter is 46,855 ounces, which is an increase of 57% over the September 2015 quarter. We give a “Speculative Buy” recommendation on the stock at the current price of $ 0.46

 
BDR Daily Chart (Source: Thomson Reuters) 

Evolution Mining Ltd

EVN Detail
Acquisition of Marsden copper-gold project: Evolution Mining Ltd (ASX: EVN) is acquiring the Marsden copper-gold project from Newcrest Operations Limited, a wholly owned subsidiary of Newcrest Mining Limited for which EVN is paying on upfront an A$3 million on completion of the acquisition and would make a further A$7 million payment contingent on a decision to mine. On the other hand, EVN’s gold production for the September 2016 quarter was 205,307 ounces against the production of 216,644oz in the June 2016 quarter. EVN has completed the A$401.6 million equity entitlement offer in September 2016. These funds, along with cash and a new A$475.0 million Senior Secured Syndicated Term Facility D, will be used to pay the A$880.0 million acquisition cost to Glencore on completion of the Ernest Henry transaction.

 

Consolidated production and sales summary (Source: Company Reports)
 
On the other hand, EVN’s FY17 production guidance of 800,000 – 860,000oz at an AISC of A$900 – A$960 per ounce lacks some attraction. We give an “Expensive” recommendation on the stock at the current price of $ 2.17

 
EVN Daily Chart (Source: Thomson Reuters) 

Gold Road Resources Ltd

GOR Details
FS has confirmed Gruyere Gold Project’s reserve and project life: Gold Road Resources Ltd (ASX: GOR) has finished the Feasibility Study (FS) for the development of its 6.16 million ounce (Moz) Gruyere Gold Project and has confirmed the project to be one of the longest life, lowest cost, undeveloped gold deposits in the world. The project has an ore reserve in excess of 3.5 Moz over a 13-year Mine Life and a Project Life of 15 years. Moreover, GOR has finished the infill and extensional drilling program at the Alaric Deposit and completed initial resource drilling at YAM14 Prospect. Additionally, GOR has announced the early works at about A$18 million would begin for the Gruyere Gold Project, after getting the grant of several key Miscellaneous Licenses by the Department of Mines and Petroleum. This would ensure planned construction of the Gruyere accommodation village and an access road from the village to the main site in the December 2016 quarter. Moreover, the regional aircore (AC) drilling program recently finished has identified gold in multiple targets and a Reverse Circulation (RC) drilling program would start testing the priority targets in the December 2016 quarter. The four target areas have been identified for priority follow?up RC drilling, YAM10, Riviera, Yaffler South and Kingston North. GOR stock rose over 17.17% in the last six months (as of October 27, 2016) as we give a “Buy” recommendation on the stock at the current price of $ 0.57

 
GOR Daily Chart (Source: Thomson Reuters) 

Newcrest Mining Limited

NCM Details
Rise in September quarterly gold production: Newcrest Mining Limited’s (ASX: NCM) has announced that a subsidiary has exercised an Option to purchase the Seguela gold project. This triggered the payment of first instalment of a total of USD3.5 million in consideration payments. The group’s September quarterly gold production rose 3% to 615koz while copper production surged 12% to 24kt. The group’s gold output from Cadia East and Gosowong were offset by reduced output from Lihir. AISC per ounce also increased 0.4% while the AISC per ounce margin improved 15%. The group has sold its 50% share of Hidden Valley. Marsden copper-gold project is being acquired by the Evolution Mining Limited for which Evolution is paying $3 million as an upfront, and another $7 million if it decides to go ahead with mining the site. On the other hand, Macmahon Holdings (for which NCM is the client) has announced that it has recently been impacted by issues at its operations in Nigeria and at Telfer in Western Australia and is in discussion with NCM to mitigate the issue. Moreover, NCM stock rose 67.3% in this year to date (as of October 27, 2016) while trading at a higher P/E. Accordingly, we give an “Expensive” recommendation on the stock at the current price of $ 21.42

 
NCM Daily Chart (Source: Thomson Reuters)

Northern Star Resources Ltd

NST Details
Confirmed sale of Plutonic gold mine: Northern Star Resources Ltd (ASX: NST) is acquiring an initial 20% interest in the Acra Gold Project by paying Pioneer $500,000 cash and has the right to earn a further 55% interest (total 75% interest) in the project by sole funding $3 million of exploration expenditure within 3 years. Moreover, NST has confirmed finishing the sale of its Plutonic gold operations to Billabong Gold Pty Ltd while declared a special fully franked dividend of $0.03 per share. NST’s September quarter updates revealed free cash flow of A$24m post investments of about A$28m and the company has no bank debt. The gold production for the quarter was 110,000 oz from continuing operations.

 

Quarterly Results (Source: Company Reports)
 
However, NST expects the total gold production of 485,000-515,000oz at an AISC of A$1,000-A$1,050/oz (US$728-$765/oz) in FY 17. Given the recent fall in gold prices, the group might face pressure given these AISC costs for FY17. We give an “Expensive” recommendation on the stock at the current price of $ 4.07

 
NST Daily Chart (Source: Thomson Reuters) 

Perseus Mining Limited

PRU Details
First gold production in December 2017 quarter from Sissingué Gold Mine: Perseus Mining Limited (ASX: PRU) reported a gold production of 43,776 ounces in September quarter 2016, which is 9% more than the prior quarter, and is on track to achieve December 2016 half year guidance of 80-100,000 ounces.

 

September Quarter performance (Source: Company Reports)
 
Moreover, the full-scale development of Sissingué Gold Mine is ongoing during the quarter and is on track for the first gold production in December 2017 quarter. Meanwhile, PRU stock rose 11.43% in the last five days (as of October 27, 2016) while, we give a “Speculative Buy” recommendation on the stock at the current price of $ 0.59

 
PRU Daily Chart (Source: Thomson Reuters)

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