Firefinch share price tumbles 6% despite meeting gold production guidance

A little girl wearing a gold crown sulks and pokes her tongue out.A little girl wearing a gold crown sulks and pokes her tongue out.

The Firefinch Ltd (ASX: FFX) share price is tumbling in early trade, down 5.8%.

Shares in the ASX gold miner and lithium developer closed yesterday at $1.03 and are currently trading for 97 cents.

In fact, the S&P/ASX All Ordinaries Gold Index (ASX: XGD) is also well into the red this morning, down 1.4%.

Below we take a look at the highlights from the quarter just past, reported this morning by ASX share Firefinch.

What were the highlights from the past quarter?

The Firefinch share price is sliding after the company updated the market on its activities for the three months ending 31 March.

For context, the miner’s two projects are located in Mali. The company holds an 80% interest in the Morila Gold Mine and a 100% interest in the Goulamina Lithium Project.

At Morila, Firefinch reported continuing high-grade gold results from its drilling campaign at the Morila Super Pit. Additionally, the miner said significant results from one of the drill holes “may represent a new zone of mineralisation”.

The company reported substantial increases in its mineral resources at several deposits within Morila. According to Firefinch, the total mineral resources for the Morila Gold Project has reached 2.5 million ounces of gold.

Gold production for the quarter (Q1) met guidance, coming in at 10,874 ounces.

Firefinch reported production guidance for Q2 in the range of 17,000 to 20,000 ounces of gold. The miner maintained its full-year 2022 production guidance of 100,000 ounces of gold. It expects annualised production rates for the second half of the year to surpass 140,000 ounces of gold.

The company also provided updates on its Goulamina Lithium Project. Goulamina is among the largest undeveloped high-quality spodumene deposits in the world.

Partnering in a 50/50 joint venture with lithium battery materials supplier Ganfeng, Firefinch aims to bring that project into production.

Firefinch said all the required conditions have been met for Ganfeng’s investment in the project. During the quarter, Ganfeng contributed US$130 million in cash to the joint venture company.

The demerger of Goulamina into Leo Lithium Limited is reportedly proceeding on schedule.

Firefinch held cash and cash equivalents of $102 million as at 31 March.

Firefinch share price snapshot

Despite weakness over the last week, the past 12 months have seen the Firefinch share price rocket 193%.

By comparison, the All Ordinaries Index (ASX: XAO) has gained 3.5% over the past full year.

The post Firefinch share price tumbles 6% despite meeting gold production guidance appeared first on The Motley Fool Australia.

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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.

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