Mid-tier gold production and exploration company Gold Road Resources Limited (ASX: GOR) has presented its activity report for the quarter ending 31 March 2023. Production is from the Gruyere gold mine in Western Australia’s north-eastern Goldfields. Gruyere is a 50:50 joint venture with Gold Fields Ltd, which operates the mine.
Gold Road is holding an investor and analyst conference call discussing at 10.30am AEDT (8.30am AWT) today. A live webcast of the briefing will be available on the company’s website. Please register your details at www.goldroad.com.au/webcast. Webcast participants will have the option to submit written questions during the presentation via the webcast. A recording of the webcast briefing will be available on the company’s website later today.
During the March 2023 quarter, Gruyere delivered quarterly gold production of 82,604 ounces (100% basis) (December quarter: 74,201 ounces). Production was delivered at an All-in-Sustaining Cost (AISC) of A$1,399 per attributable ounce to Gold Road (December quarter: A$1,622 per ounce).
There were no Lost Time Injuries recorded during the quarter. The 12-month moving average LTI Frequency Rate for Gruyere and Gold Road remained at 0.00 at 31 March 2023. Gruyere has now achieved over 719 days LTI free. The full March Quarter highlights are:
Production and Guidance
- Gruyere produced 82,604 ounces of gold (100% basis) at an AISC of A$1,399 per attributable ounce (December quarter: 74,201 ounces at an AISC of A$1,622 per attributable ounce).
- Gold production increased quarter on quarter due to higher process plant availability and throughput rate, resulting in an increase in ore tonnes milled.
- 2023 annual production guidance remains unchanged at between 340,000 – 370,000 ounces (170,000 – 185,000 ounces attributable) at an AISC between A$1,540 and A$1,660 per attributable ounce. Grades are anticipated to lift through 2023 as mining progresses through higher-grade fresh ore.
- On 3 April 2023, the Gruyere JV celebrated the first 1 million ounces of production. This achievement comes less than four years since Gruyere poured first gold in June 2019 and seven years since signing the first mining agreement with the Yilka People.
- On 5 April 2023, Gold Road provided Gruyere’s 3-Year production outlook, which ranges between 335,000 and 375,000 ounces per annum (100% basis). Gold Road also re-affirmed sustainable production at ~350,000 ounces per annum rate from Gruyere to 2032 through a seven-stage mine plan.
- Feasibility level studies for the Golden Highway resources are scheduled for 2023 in preparation for mining, which is anticipated to commence in early 2026 and will form part of the Gruyere life-of-mine plan.
Financial and Corporate
- Gold Road’s gold sales totalled 41,818 ounces at a record average price of A$2,764 per ounce. Gold Road’s production is fully unhedged. Gold doré and bullion on hand on 31 March 2023 was 1,964 ounces.
- Gold Road’s attributable operating cash flow from Gruyere for the quarter was $72.1 million (December quarter: $47.3 million).
- Record free cash flow of $44.2 million for the quarter (December quarter: $16.5 million) before dividend payments of $4.6 million and a divestment of listed securities for $8.1 million.
- Gold Road’s Corporate All-In Cost (CAIC), which includes growth capital, corporate and exploration costs, was A$1,609 per ounce for the March 2023 quarter.
- Cash and equivalents increased to $127.9 million (December quarter: $80.8 million) with no debt drawn.
- On 27 March 2023, Gold Road paid a fully franked dividend of 0.5 cents per share for the six months to 31 December 2022.
- As at 31 March 2023, Gold Road held listed investments with a market value of approximately $480.5 million.
- At the Gruyere JV, a reverse circulation rig mobilised to continue resource delineation of the Golden Highway (Gold Road 50%). One aircore rig was operating across the Yamarna (Gold Road 100%) project and continues to delineate targets.
- Grant of exploration licences at the Greenvale and Galloway projects (Gold Road 100%) were received. Land access agreements were also progressed, with on-ground activities scheduled for the June quarter.
- At Mallina (Gold Road 100%), heritage surveys were completed in advance of planned drilling in the June quarter. Field mapping was conducted across the property and observed significant evidence of alteration and veining associated with interpreted intrusions and surrounding sediments. Rock chip sampling was completed.