Resolute Mining Limited (RSG) has become the latest Australian mining company to ‘pre-release’ its 2015-16 results by reporting that it earned a record net after tax profit of $213 million for the year ended to June 30. That compares to the $569 million loss for 2014-15.
The company said in a statement to the ASX before trading started, the result was unaudited and the full detailed figures would be release later this month, Resolute joins the likes of Northern Star Resources (NST) and several smaller groups in revealing unaudited figures well ahead of the release of their actual 2015-16 results.
The news had no impact on the share price of Resolute and the shares fell 5.1% to $1.835. Still, after a more than 600% surge this year, the fall yesterday won’t hurt those shareholders who have been holding the stock for a long time.
Resolute said the result was generated from gold sales of 340,540 ounces which delivered a gross profit from operations of $A167 million, up 135% from FY15.
"The record net profit was made up of the strong A$167m operating result further boosted by A$45m in profits booked on the divestment of Resolute’s residual Tanzanian interests in November 2015 including the extinguishment of net liabilities (A$3m), and an accumulated foreign exchange gain recognised in equity up to the date of the sale (A$42m),” the company said yesterday.
CEO John Welborn, said in yesterday’s statement:
“Resolute has delivered above all expectations to generate a record net profit in FY16 of A$213m. The excellent result endorses our strategy of implementing strict discipline in the allocation of capital and applying an urgency to the need to reduce costs in every area of our business.
"We have been resolute in prioritizing the repayment of debt and the accumulation of cash and bullion to strengthen the Company’s balance sheet and prepare for exciting investments in organic growth.”
“The ability to revitalize Resolute and generate record profits has its foundation in the quality of our assets, the expertise and experience of our people, and the implementation of a cultural revolution driven by a commitment to deliver enduring value to our shareholders.
"The recent gold price strength has assisted a continuous improvement program designed to fundamentally raise performance across the company. Further enhancements and achievements are expected as we focus on the actions and strategies required to transform our gold assets into an outstanding business that can consistently provide exceptional rewards to our shareholders.”
The company said debt was reduced by $A91million in 2015-16 and there was no secured debt as at June 30. It said that a US$20 million “Gold Prepay Loan Facility (was) settled in full with final gold instalment delivery in October 2015; a US$50m Senior Secured Cash Advance Facility (was) fully repaid in June 2016; and a A$15m of Convertible Notes (was) converted and redeemed in June 2016.”
Resolute said it had cash and gold bullion at market value $A102 million, up from $A54 million at the end of 2014-15.
