GOLD WRAP: Ramelius Resources has increased its profit 250 per cent year-on-year, bringing in almost $220 million last financial year as it rode a wave of record gold prices and low costs.
Goldminer Ramelius Resources has increased its profit 250 per cent year-on-year, bringing in almost $220 million last financial year as it rode a wave of record gold prices and low costs.
The Edna May and Mt Magnet mine operator sold 293,966 ounces at an all-in sustaining cost of $1,583 per ounce in the 2024 financial year, for a net-profit after tax of $216.6 million – up from $61.6 million a year earlier.
Ramelius’ profit was generated off a 40 per cent revenue increase, from $631.3 million to $882.6 million.
“The increased revenue was not only due to a higher gold price, which added $119 million, but also increased gold production, which added $131 million compared to financial year 2023,” Ramelius managing director Mark Zeptner said.
Ramelius improved grades at its Mt Magnet hub last year, increasing the contributions of its high-grade Penny mine while improving the milled grade at its Eridanus mine by 51 per cent year on year.
At Edna May, it added a third haulage route from the Symes goldmine.
That project is being scaled down in the months ahead, with Ramelius expecting a further 45,000 ounces from stockpiles before it goes into care and maintenance.
Ramelius increased its full-year dividend to a record 5c per share.
In the year ahead, Ramelius expects to produce 270,000-300,000 ounces at an all-in sustaining cost of between $1,500 and $1,700 per ounce.
The company has set aside $20 million to $30 million for growth capital, down from the almost $50 million it spent this year despite a commitment to pursue organic growth opportunities.
Ramelius has, over the last year, been active on the acquisition front and taken steps to consolidate
Any comment around merger and acquisition activity was absent in the company’s annual report.
But the Ramelius balance sheet remains strong, with $446 million worth of cash and gold on hand and a further $175 million available through an undrawn finance facility.
Ramelius holds an 18.75 per cent stake in neighbouring Spartan Resources, taken across June and July, in a move which led to speculation it may be looking to swoop on its neighbour.
Ramelius has played down that speculation over the months since, but Mr Zeptner told reporters on the sidelines of the Diggers & Dealers Mining Forum that the company would continue to assess Spartan from afar.
Ramelius bought into Spartan at around 90c per share. The company’s stock is currently trading at $1.36.
Shares in Ramelius were down 0.7 per cent to $2.07 this morning.
Waterlogged Gold Road looks ahead
The impact of rain which hir the Gruyere goldmine for seven weeks was partially offset by record gold prices for unhedged Gold Road Resources, but profit was down in half one of 2024.
Gold Road reported a 12.6 per cent reduction in net profit in the first half of 2024 compared against the first half of 2023, generating $43.1 million.
The fall was attributed to its 50:50 Gruyere joint venture, where it is the non-operating partner alongside Gold Fields, which was impacted by weather for seven weeks earlier this year.
Gold Road managing director Duncan Gibbs said the company was challenged by the weather event, which closed the main road to and from Gruyere, but had benefited from gold price highs.
“Gruyere is now well set to deliver against our expectations of this high-quality orebody,” he said.
“I expect to see a ramp-up in gold production through the remainder of 2024 with a sustained improvement in mining rates to support higher levels of gold production in future years.”
The JV has had its challenges scaling up Gruyere in recent years, with blame levelled at the main contractor and, at times, the operator by Gold Road.
Speaking to Business News earlier this month, Gold Fields’ South African-based CEO Mike Fraser said the issues were being addressed
Gold Road’s cash position fell 73.2 per cent last quarter, from $152.6 million to $79.4 million.
It found better luck on the market.
The value of its listed investments climbed 62.3 per cent from $416.1 million to $478.4 million.
Gold Road paid a 0.5c per share dividend for the first six months of 2024.
Its share price was 3.7 per cent lower this morning, at $1.75.
