Evolution share price lifts as results fall ‘in line’ with forecasts

a miner holds his thumb up as he holds a device in his other hand.a miner holds his thumb up as he holds a device in his other hand.

The Evolution Mining Ltd (ASX: EVN) share price is tracking higher today amid the release of the company’s quarterly earnings and full-year report.

At the time of writing, the ASX gold share is trading 1.3% in the green at $2.34.

In broad market moves, gold is down again today and is trading at US$1,693 per troy ounce. Meanwhile, the S&P/ASX 200 Resources Index (ASX: XJR) is currently down 1.72%.

Evolution FY22 earnings ‘in-line’ with forecasts

Key takeouts for the FY22 period, including Q4 FY22, include:

  • Group gold production increased 16% to 172,722 ounces in the June 2022 quarter, up from 148,787oz in the March quarter
  • All-in sustaining cost (AISC) of $1,290 per ounce for the quarter
  • FY22 group gold production of 640,275 ounces
  • FY22 AISC of $1,259 per ounce places Evolution “as one of the lowest cost global gold producers”
  • Ernest Henry asset in Queensland generated more than $435 million of net mine cash flow in FY22
  • Group gold production to grow by 25% over the next two years

What else happened this period for Evolution?

In a boost for the Evolution share price, the company generated a mammoth $435 million of net cash flow from its mining operations in FY22. On this result, the AISC was negative $1,680 per ounce.

Moreover, the company’s gold production for the last quarter of 2022 was 16% higher quarter-on-quarter and came in at 172,722 ounces.

Its Mungari operation in Western Australia grew production by 7% to more than 35,000 ounces last quarter, helped by the integration of the Kundana assets, Evolution said.

Finally, it left the period with a cash balance of $572.4 million and net debt of $1.2 billion.

What’s next for Evolution Mining?

The company expects group gold production to grow by 25% over the next two years. It guides a 12% increase in FY23 to around 720,000 ounces.

For FY24, the outlook increases a further 11% to 800,000 ounces, give or take 5%.

On this production, Evolution forecasts AISC for FY23 and FY24 at $1,240 per ounce. It also sustained its capital guidance of $190–$240 per annum over the coming two years.

It has a major capital guidance for FY23 of $530–$600 million, and projects around $330–$380 million in FY24.

Evolution share price snapshot

In the last 12 months, the Evolution share price has fallen more than 42%. It is down by a similar amount this year to date.

In fact, the share is in the red across all major timeframes.

The post Evolution share price lifts as results fall ‘in line’ with forecasts appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. 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 Scott Phillips.

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