Gold Road shares down following production update
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Shares in Gold Road Resources were sold off on Monday following an announcement that annual production at its flagship Gruyere mine hit the lower tier of its 2023 production guidance.
Duncan Gibbs-backed Gold Road closed trade at $1.39 per share, down 18 per cent.
Gold Road's 2023 production guidance yielded 321,984 ounces of gold, meeting the lower end of its 320,000-350,000oz annual guidance target. For the December 2023 quarter, it produced 74,659oz, down from 88,668oz in September.
Its all-in sustainable cost price per attributable ounce realised $1,973 for December, up from $1,682 during the September quarter.
The goldminer said its lower quarterly production was primarily down to unexpected labour availability issues, which resulted in delays accessing higher grade ore within its open pit.
Attributable operating cash flow at Gruyere also dipped from $93.5 million to $69.6 million between the September and December quarters, due to escalating costs.
Gold Road is confident both material movement and labour issues will improve at Gruyere, a 50:50 joint venture with South Africa-based Gold Fields.
An annual production guidance between 300,000-335,000oz in 2024 has been earmarked for Gruyere, along with an attributable ASIC between $1,900-2,050/oz.
The company also provided an update regarding its exploration plans at the mine.
Aside from various drilling activities, a scoping study will be conducted in a bid to determine whether a future underground mine at Gruyere would be feasible.
Gold Road said the study would be faciliated by an indepedent consultant, with multiple underground options likely to be explored.
Previous concept studies have flagged the possibility of Gruyere transitioning from an open pit to underground operation following its project mine life.