The Saracen Mineral Holdings Limited (ASX: SAR) share price is on watch this morning after the miner announced gold production above guidance. Saracen released its June quarterly activities report which revealed FY20 production of 520,414 ounces of gold, ahead of FY20 guidance of +500,000 ounces.
What does Saracen Mineral Holdings do?
Saracen is an Australian gold miner with 3 mines on the doorstep of Kalgoorlie. The company mines from the Carosue Dam and Thunderbox operations, and has a half share in the Super Pit, the biggest open pit gold mine in Australia.
The Saracen share price is up 41% over the past year and 102% from its March low. The rise in the share price has been assisted by the rising price of gold, which has increased from around $2,200 an ounce at the start of 2020 to closer to $2,600 an ounce currently.
What did Saracen Mineral Holdings announce?
Saracen released its June quarterly activities report, which showed quarterly production of 145,830 ounces of gold at an all-in sustaining cost of $1,152 an ounce. Over the full year, Saracen produced 520,414 ounces of gold at an all-in sustaining cost of $1,101 an ounce. This was ahead of FY20 guidance of +500,000 ounces.
Saracen sold 148,011 ounces of gold during the June quarter at an average price of $2,280 an ounce, generating sales receipts of $338 million. The company had cash and bullion of $369 million at 30 June, up from $339 million at 31 March. Debt was $321 million at the end of the June quarter, giving net cash of $48 million up from net debt of $21 million at 31 March 2020.
What is the outlook for Saracen Mineral Holdings?
Saracen has announced unaudited FY20 sales revenue of $1,072 million, with unaudited statutory net profit after tax of $190 million to $200 million. In FY21, Saracen has forecast production of +600,000 ounces of gold. The company has large ore stockpiles of 1.7 million ounces, which will help insulate the business should mining be restricted due to COVID-19 or other impacts.
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Motley Fool contributor Kate O’Brien has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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