LOGIN JOIN SHARECAFE SIGN UP FOR OUR NEWSLETTER ADVERTISE
share cafe logo  
 
SHARECAFE COMMENTARY

Resolute Mining Unveils Syama Potential
BY EVA BROCKLEHURST - 04/07/2018 | VIEW MORE ARTICLES FROM FNARENA NEWS

Get More Commentary, Discussion & Market Information On -

RSG - RESOLUTE MINING LIMITED


Gold miner Resolute Mining ((RSG)) has garnered attention after delivering an updated Definitive Feasibility Study (DFS) for its Syama Underground mine in Mali.

Overall, the news was good: higher inventories, an extended mine life (to 2032 from 2028); and lower processing unit costs thanks to higher automation and improvements in power strategy.

Reading through stockbroking analysts' assessments post update, it appears the positives marginally outweigh the negatives: a rise in capital expenditure to fund the automation, and an increase in technical risks implied by a reliance on automation in a remote locality.

The share price jumped 7.5c in morning trade to $1.38 (5.75%) at 11.30am Sydney time in response to the news. Technically, the stock has encountered strong resistance at this level for the past year, although it has been trading gently upward since January.

Large Increase Underground Reserves

Syama’s capital expenditure bill is estimated at $97m – a figure Macquarie says can be funded through cash flow. The pay-off is a fall in underground mine costs of -$US135/oz, taking costs to US$746/oz.

The DFS also outlines a 38% increase in Syama’s underground probable reserves.

The big take-out was Resolute’s potential for further upside, particularly should the company encounter further success with exploration and its potential to achieve higher throughput rates.

Broker Cannacord Genuity says the miner has the capacity to scale up without reducing mine life.

Buy Ratings Galore

Citi, Macquarie and Cannaccord all retained their Outperform/Buy ratings on the stock.

Citi lifts the target price to $1.80 from $1.70, Macquarie increased its target price to $1.50 from $1.40 and Canaccord raised its target price to $1.85 from $1.75.

Resolute Mining owns three operating mines in Africa and Australia and a portfolio of exploration projects in Mali, Australia, Ghana and the Cote D’ivoire.

Resolute’s March-quarter production report proved disappointing so the market will be keeping a keen eye out for the June production figures.



View More Articles By FNArena News

FN Arena is building the future of financial news reporting at www.fnarena.com. Our daily news reports can be trialed at no cost and with no obligations. Simply sign up & get a feel for what we are trying to achieve.




The content of this information does in no way reflect the opinions of FN Arena, or of its journalists. In fact we don't have any opinion about the stock market, its value, future direction or individual shares. FN Arena solely reports about what the main experts in the market note, believe and comment on. By doing so we believe we provide intelligent investors with a valuable tool that helps them in making up their own minds, reading market trends and getting a feel for what is happening beneath the surface. This document is provided for informational purposes only. It does not constitute an offer to sell or a solicitation to buy any security or other financial instrument. FN Arena employs very experienced journalists who base their work on information believed to be reliable and accurate, though no guarantee is given that the daily report is accurate or complete. Investors should contact their personal adviser before making any investment decision.

 

SHARECAFE VIDEO


Ironbark Karara discuss Altium (ASX:ALU)

More video   

RECENTLY ADDED TO SHARECAFE


 › Marcus Today End Of Day Report
 › Friday At The Close
 › Stars Aligning For Orion Minerals
 › Market At Midday On Friday
 › Burning Questions Over Avita, Polynovo Valuations
 › The Market Doesn't Care What Price You Paid
 › Getting Started With The Basics
 › Next Week At A Glance
 › The Overnight Report: Off The Boil
 › TCL - Citi rates the stock as Sell
 › S32 - Macquarie rates the stock as Outperform
 › CMA - Morgans rates the stock as Add
 › ACCC Delays Transurban Decision
 › Manganese Drives South32 North
More ShareCafe   

GET THE SHARECAFE BREAKFAST BRIEFING


Delivered free to your inbox before the market opens each trading day. Sign up below +