PERTH (miningweekly.com) – Gold miner Silver Lake Resources has narrowed its net loss for the financial year ended June, despite a fall in gold sales and revenue.
“Silver Lake has returned to its core assets where it has been possible to generate a superior financial return from substantially less production,” said MD Luke Tonkin.
“The balance sheet has been strengthened and a coherent value-accretive strategy has been deployed, which invests in our core assets to deliver significantly higher margins, while crystallising inherent value from Silver Lake’s noncore assets.”
During the year under review, the net loss after tax narrowed from the A$170.4-million reported for 2014 to A$94-million, despite revenue declining from A$309.7-million to A$186-million.
Gold sales for the year were down from the 217 348 oz achieved in 2014, to 124 209 oz, with gold produced from the Daisy complex, the Cock-eyed Bob underground mine and the Wombola Dam openpit and stockpiles.
Earnings before interest, taxes, depreciation and amortisation increased by 45% on the previous financial year, to A$38-million, primarily owing to Silver Lake’s decision to place the Murchison operation on care and maintenance and to focus its resources on the core Mount Monger operations.
Processing costs also reduced with the sale of the Lakewood mill, with all feed sources now being processed through the Randalls mill.
Tonkin noted that, following a strategic exploration review, Silver Lake had also committed to investing its exploration funds into the core Mount Monger tenements, which host numerous near-surface Daisy Milano target analogues, which, if converted, could materially enhance the group’s operating margins.
“Silver Lake’s short- to medium-term production plan generates sufficient cash to invest in planned exploration activities and future mine development and, given the prevailing gold price, establishes a sound platform for earnings growth,” Tonkin added.
This strategy would focus on maximising cash flow from the Mount Monger operations, commencing production from the Lucky Bay, Rumbles and Santa Area openpit mines, generating lease incomes from the Murchison processing facility, executing the updated exploration strategy and divesting of the Murchison operations and the Great Southern project.
Silver Lake was aiming for gold sales of between 125 000 oz and 135 000 oz for the 2016 financial year.