Good afternoon
We would like to invite you to our 19th
AUSTRALIAN RESOURCES CONFERENCE
in Zurich, Hotel Baur au Lac, on the 21st of February 2020
Please find invitation/registration/participating companies under the link: https://www.schroeder-equities.com/conference/
Registration – without any charge – is essential
As usual, the companies are inviting, and the attendance is free for investors
2020 is shaping up to be an interesting year. US brokerage Sanford C.Bernstein states, that resources stocks are at their cheapest vs the wider market in 100 years! We hope to present you with some companies, which should enable you to profit from this theme – covering a wide range of commodities from copper to gold, from gas to battery materials!
Please feel free to pass this invitation on to interested investors and colleagues. A detailed timetable will be forwarded to all registered attendees by mid-February.
And now to our usual update::
Equities are finishing the week on a quieter note, as are metals - largely unchanged including gold - and currencies, even though the uS$ is slightly stronger again. Not much action in bonds, either!
Nonfarm payrolls in the US increased by a few thousand people less than expected, and weekly hourly wages were subdued, increasing by 2.9% and a little less than in recent times.
Kirkland Lake had a record Quarter, driven by it´s fantastic Fosterville Mine in Australia, which produced gold from an average ore grade of 50g/t!!!!
Evolution - did not fare that well in the last Quarter!! The company announced raw production numbers of 171.000 oz in the Quarter, about 10.000oz less tha expected. Costs of 1069 A$ AISC / oz wre also a little high, leading to first half numbers of 362.900 oz at AISC of 1040 A$. Mind you - that equals about 710 US$/oz, and the number is still a varey good one - nevertheless, they represent a small disappointment. The only detailed numbers given were for Mt.Carlton . The previous star performer will only produce 70-75.000oz this financial year, at AISC of 1150 A$ - 1225 A$/oz - that´s 20-25.000 oz less than expected, and at costs about 250 A$ higher. Evolution will therefore have production for the current financial year at the bottom of guidance, about 725.000oz, while ( surprsingly ) AISC of 940-990 A$ remains unchanged. If they will achieve cost guidance especially, that will be a great effort for the next 6 month! The Mt Carlton downgrade is due to a narrowing of the orebody, which is occuring earlier ( = shallower ) than planned - and I guess will be a permanent change.
The large Cowal mine has been watched by investors for a while, as the major drought in New South Wales will potentially restrict access to fresh water for the mine. Evolution is countering these risk with an additional water pipeline, which will increase pumped water capacity by 30%. This project will be finished this Quarter. The company has also drilled a few more more bore holes, and more to follow, to permannently increase water capacity, which will be unrestriced. All additional water sources are from saline water - this could turn out to be a negative for costs. I would not suspect this to be a major issue, but it could add to already existing pressure on costs.
Overall - a small dent into what has been Australia´s most consistent producer over several years, but not a major drama. As I said above - if Evolution can fulfill it´s cost guidance for this year, I would regard this as a major achievement. The reaction in the market today has been fairly muted, as gold stocks were down 3-4% anyway….market does not seem to see a major story here as well.
Have a nice weekend!
WS
Schröder Equities GmbH
Seitzstr.7a
80538 München
Tel. +49-89-4613440-0
Fax +49-89-4613440-10
email: wschroeder@schroeder-equities.com
website: www.schroeder-equities.com
eingetragen im HR München, HRB 166985
Geschäftsführer: Wilhelm Schröder
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