PERTH (miningweekly.com) – Gold miner Evolution Mining told shareholders on Thursday that it had no ambition to become a gold major.
Speaking at the company’s annual general meeting, chairperson Jake Klein said the company’s strategy was centered around an ambition to be a premier midtier gold producer, with six to eight operating assets in tier-one jurisdictions.
“We do not have ambitions to become a gold major because the midtier space offers the best returns to shareholders. This is based on the premise that midtier companies generate enough cashflow to fund their own growth and return dividends to shareholders, yet are also small enough where a discovery can make a significant difference to the company’s value.”
A recent report by advisory PwC noted that Australia’s midtier miners had outperformed the market during the Covid-19 pandemic, with the top 50 ASX-listed midtier miners, of which Evolution was one, reporting revenue increases of 6%, to A$29.4-million.
Klein told shareholders on Thursday that despite the recent price movements for gold, the commodity outlook remained positive. However, he urged industry participants to "lay the foundation" for stronger, more resilient and more profitable companies for the future.
“Our strategy recognises that we are investing our shareholder’s capital and for every dollar we spend, we need to achieve an appropriate risk weighted return. If we cannot be confident of delivering this, we should not be making the investment.
“The gold industry’s track record has been particularly poor in this area as capital has been allocated to marginal projects that only deliver returns if the gold price continues rising.”
Klein said that Evolution was seeking to differentiate itself by focusing on delivering the best, long-term sustainable returns to shareholders.