Saracen hits higher ground with record-breaking quarter

Image: Saracen Mineral Holdings.

Saracen Mineral Holdings has enjoyed a record-breaking quarter with gold production and costs running ahead of guidance.

The unprecedented company output saw an increase in revenue during the period, from $154 million at June 30 to $196 million despite spending $5.5 million on tax instalment payments and investing $35 million on net growth and exploration.

Saracen managing director Raleigh Finlayson said the production and free cash flow generation reflected the investment the company had made in exploration and development in recent years.

“These results show that we are harvesting the benefits of what we sowed over the past two or three years,” Finlayson said.

“Organic growth is underpinning not only record production rates but also substantial free cashflow, which also reflects our low production costs and our status as a debt-free company.”

Saracen achieved record quarterly gold production of 96,325 ounces, including 50,590 ounces at Carosue Dam and 45,735 ounces at Thunderbox, with all-in sustaining costs (AISC) of $964/ounce.

The company has maintained guidance of 350,000-370,000 ounces at an AISC of $1025-1075/ounce for the 2020 financial year.

A record quarter was also achieved at Thunderbox, with its AISC falling to $682/ounce as the C Zone open pit mine delivered higher grades and lower strip ratio ore as planned.

Finlayson said the ramp-up at Thunderbox was exceptional.

“With the project enjoying some of the lowest costs in the industry thanks to the combination of high grades and low strip ratios. The benefits can be seen in our growing bank balance,” he said.

Saracen continued its regional “bolt-on” acquisition strategy during the quarter, with two transactions successfully completed in the Thunderbox district.

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