Shares in Evolution Mining Ltd (ASX: EVN) will be on watch today after the company announced an impressive quarterly update to the market this morning.
Evolution Mining was formed in November 2011 and is one of Australia’s largest gold miners. It owns five mines, being Cowal in New South Wales, Cracow, Mt Carlton and Mt Rawdon in Queensland and Mungari in Western Australia. Evolution also has a stake in the Ernest Henry copper-gold mine that will deliver 100% of future gold and 30% of future copper and silver produced from an agreed life of the mine area. Outside of the life of the mine area, Evolution will have a 49% interest in future copper, gold and silver production.
Total gold production of 191,967 ounces was achieved during the September quarter including a record production at the Cowal mine of 75,807 ounces.
The company recorded a record mine operating cash flow of $278.7 million, representing a 30% increase on the previous quarter. Group free cash flow came in at $158.6 million, 45% up on the previous period.
The company’s balance sheet was strengthened during the 3 months until September 30, with net cash of $91.7 million up from $35.2 million as at June 30.
Full-year production guidance remained unchanged at 725,000-775,000 ounces. However, guidance for the company’s All In Sustaining Cost (AISC), which basically reflects the company’s cost of digging the commodity out of the ground, was lifted by $50 an ounce to a range of $940-$990 per ounce.
This adjustment to the AISC will result in a slight decrease to full-year profit forecasts, so it will be interesting to see how the share price responds when the market opens this morning.
At the time of publishing, Luke has no financial interest in any companies mentioned.