Here’s why the Ramelius (ASX:RMS) share price tumbled 8% to 4-month lows today

a woman wearing a gold top and carrying a gold bar gives the thumbs down signal as she leans against a wall with a sombre look on her face.a woman wearing a gold top and carrying a gold bar gives the thumbs down signal as she leans against a wall with a sombre look on her face.a woman wearing a gold top and carrying a gold bar gives the thumbs down signal as she leans against a wall with a sombre look on her face.

Key points

  • The Ramelius share price sank 8% today
  • Investors did not warm to the company’s quarterly results
  • Gold production at its Western Australian mines was at the lower end of the guidance

The Ramelius Resources Ltd (ASX: RMS) share price finished in the red after the company released its quarterly report today.

The company’s shares were swapping hands at $1.32 at the close of trade, down 8.04%. This is its lowest level since late September 28, 2021.

Let’s take a look at what the gold miner reported today.

Ramelius share price falls amid quarterly results

The company released its 2021 quarterly report for the period ending 31 December 2021. Highlights included:

  • Cash and gold on hand fell 39.9% on the previous quarter to $164.5 million
  • Gold production of 66,919 ounces at an all-in sustaining cost (AISC) of $1,493 per ounce
  • The miner produced 31,552 ounces at Mt Magnet mine and 35,367 at Tampia mine, both in Western Australia
  • Total revenue was $182 million from 77,225 ounces of gold sales at an average price of A$2,357 per ounce.

What else happened in the quarter?

Ramelius owns and explores the Edna May, Vivien, Marda, Tampia and Penny gold mines in Western Australia.

The company said overall production targets were at the lower end for the quarter. There was a slight fall in the grade and throughput at its Mt Magnet project.

This was due to a shortage of oxide, and workforce shortage impacting the company’s ability to haul as much ore as it would have liked.

However, Ramelius said there was an increase in ore stocks at the Tampia and Marda mines, with 785,000 tonnes of ore that could generate up to $60 million in cash flow.

The company completed plenty of diamond drilling during the quarter and received assay results. Ramelius also acquired the Rebecca Gold Project from Apollo Consolidated Limited.

Capital and project development spending for the 2022 financial year remains at about $70 million.

What’s next for the company?

Ramelius Resources said the impact of the WA border closure and any COVID-19 infections at the mine site were too hard to predict. Supply disruptions could also be impacted.

Gold production guidance for FY2022 remains at 260,000 to 300,000 ounces at an AISC of A$1,425-$1,525 per ounce

Ramelius share price recap

The Ramelius share price has fallen 16.24% since the start of 2022, and 10.85% over the past 12 months.

In comparison, the S&P/ASX 200 Index (ASX: XJO) has returned just over 5% in the past year.

The company has a market capitalisation of about $1.1 billion based on its current share price.

The post Here’s why the Ramelius (ASX:RMS) share price tumbled 8% to 4-month lows today appeared first on The Motley Fool Australia.

Should you invest $1,000 in Ramelius Resources right now?

Before you consider Ramelius Resources, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Ramelius Resources wasn’t one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of January 13th 2022

More reading

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://www.fool.com.au/2022/01/28/heres-why-the-ramelius-asxrms-share-price-tumbled-8-to-4-month-lows/

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s