PERTH (miningweekly.com) – Gold miner Evolution Mining has reported record underlying net profits, earnings before interest, taxes, depreciation and amortization (Ebitda) and cash flows for the half-year ended December.
Underlying net profits for the quarter increased by 62% on the first half of 2019, to A$149.1-million, while Ebitda increased by 23% to A$441.2-million, and group free cash flows by 119% to A$242.4-million.
Evolution on Wednesday said that the group’s financial results for the interim period were underpinned by a 19% increase in revenues, which reached A$898.2-million, compared with the A$756.2-million achieved in the previous corresponding period, on the back of a 24% increase in the achieved gold price.
The increased gold price was slightly offset by a decrease in ounces sold, which declined from the 384 556 oz achieved in the first half of 2019, to 378 596 oz in the six months to December.
“These record half-year financial results demonstrate the quality of Evolution’s asset portfolio. The Ebitda margins and free cash flow generation of our business are sector leading,” said Evolution executive chairperson Jake Klein.
“Importantly, the attractive growth opportunities we are delivering out of our key long life, high margin assets reflect the sustainability of this strong cash generation,” he added.
Gold production in the six months to December reached 362 857 oz, down from the 382 214 oz produced in the previous corresponding period.
The Cowal mine continued to be the biggest producer for Evolution in the interim period, contributing 140 887 oz, up from the 119 504 oz in the previous corresponding period, while production at Mungari reached 63 489 oz, on par with the 65 112 oz delivered in the first half of 2019.
Evolution is currently working to bring the Cowal underground mine into operation, and spent A$63.6-million on the project in the first half of the financial year.
Production at the Mt Carlton operation declined from 52 298 oz to 30 664 oz, after recent grade control and resource definition drilling at the V2 openpit had returned results identifying the West and East lode orebodies were narrowing at shallower levels than previously modelled.
A geological review of the underground resource model has resulted in similar geological interpretation as the openpit, Evolution said.
Meanwhile, production at Mt Rawdon also fell from 50 119 oz to 39 588 oz as the operation was impacted by the instability of the western wall, resulting in lower total material being mined.
Production at Cracow remained fairly consistent at 41 770 oz, compared with the 44 731 oz produced in the previous corresponding period, while production at Ernest Henry declined slightly from 50 450 oz to 46 458 oz.
During the interim period, Evolution struck a $375-million deal with gold major Newmont Goldcorp to acquire the Red Lake gold mine, in Ontario, Canada.
Red Lake is an underground gold mining complex comprising the Red Lake and Campbell complexes, which each consist of an underground mine and associated processing infrastructure, as well as the Cochenour mine.
During 2018, the mine produced 276 000 oz of gold at an all-in sustaining cost of $988/oz, with the operation forecast to produce between 150 000 oz and 160 000 oz in the 2019 calendar year, at an all-in sustaining cost of about $1 600/oz.