Alkane Resources meets 2023-24 guidance for Tomingley Gold Mine

Company News

by Glenn Dyer

Alkane Resources (ASX:ALK) has confirmed that its Tomingley Gold Mine in central western NSW met its reduced guidance estimate for the 2023-24 financial year after a slower-than-predicted expansion ramp-up in the final quarter of the year.

The company also announced a higher guidance target for the year ending June 2025.

Alkane reported that Tomingley delivered strong production in the final quarter of the financial year, meeting its updated guidance of 55,000 oz to 58,000 oz by producing 57,217 oz of gold.

Costs will end up around the updated range of A$2,150/oz to A$2,350/oz on an All-In Sustaining Cost basis.

In early June, Alkane issued a revised guidance estimate for the June quarter and the 2023-24 financial year after encountering issues during the ramp-up of an expansion plan.

The original financial year guidance for Tomingley was 60,000 to 65,000 ounces.

In a statement on June 11, CEO Nick Earner explained, "Tomingley is starting to deliver from the Roswell underground. The Roswell ramp-up has not been sufficiently rapid for us to meet our original FY24 guidance, particularly given the recovery issues experienced in February from a discrete mining area in Caloma Two, as highlighted in our March quarterly report. Tomingley is now performing well, and the paste plant and flotation circuit upgrades remain on schedule."

Alkane also promised that its five-year expansion plan for Tomingley would be out by the end of June, which it delivered on June 24. The company forecast gold production this financial year to be between 70,000 to 80,000 ounces, which was reconfirmed in Thursday’s announcement.

Alkane reported its unaudited cash, bullion, and listed investments position at June 30 was $54.5 million, comprising $45.5 million in cash, $8.7 million of bullion on hand, and $300,000 of listed investments.

"During the quarter, A$42.8 million was drawn from the Macquarie Bank $60 million debt facility," the company said.

Alkane also noted that the cash and liquid assets figure "assumes no value for shares in Calidus Resources Ltd, as receivers and administrators were appointed for Calidus on June 29, 2024."

"This change in value for CAI shares will also be reflected in Alkane’s full-year FY2024 non-cash financials,” the company added.

Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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