Hello thanks for tuning into Kalkine TV, I’m Rachael and this is the Hot Performers – a
show where we take a look at stocks and sectors that could be heating up.
Gold production and exploration firm Regis Resources recently announced a change in its
production guidance following a wall slip at its Rosemont main pit. The firm noted that
other operational challenges have restricted its ability to absorb the loss of high-grade
feed. The Company’s full year guidance has been changed due to this. The full-year production
guidance for the company’s Duketon operations has been lowered to 300,000 to 340,000 ounces,
from 340,000 to 380,000 ounces. Total production is now likely to be in between 420,000 and
475,000 ounces, down from 460,000 to 515,000 ounces. However, the production guidance for
the company’s Tropicana operations continues to remain unchanged. The company, in its latest
guidance update of financial year 22, stated that as a consequence of the incident, The
company range is now $1425 to 1500 an ounce, up from $1290 to 1365 an ounce. The guidance
for Tropicana is unchanged in relation to costs. Let’s look at the details of this
recent development and see what Regis Resources’ expectations of a rise in production in second
half are. The company expects a rise in production in the second half of the current year. The
lift in production is due to increased mill feed-grade at its Moolart well, and throughput
at its Garden Well and increased underground mine grade at Rosemont. Regis Resources stated
that their preparations for and management of COVID related risks continue with the response
plans for the operations constantly being assessed and modified for changing rules and
conditions. The ongoing significant travel restrictions and general COVID impacts that
Regis, and the entire Western Australia mining industry are experiencing, continue to present
challenges and risks. Regis Resources continue to work with their contractors and suppliers
to develop and execute mitigation action plans. In other growth areas, development continued
at its Garden Well South underground mine, with first stoping due to commence late in
the June 2022 quarter. The new potential mining area under Garden Well Main pit continues
to shape up well and Regis Resources expect the results of a study later this quarter.
Positive progress of the permitting process for McPhillamys continues, albeit frustratingly
slowly.
Lastly, let’s look at Regis’ stock price performance.
The company’s stock has delivered a negative year-to-date return of nearly 10%. In the
past year, the stock fell over 51%. In the past month, the stock fell by nearly 10%.
The company in its guidance report also stated that work is now underway to recover the resource
by mining from the existing development in the Rosemont Main Zone Underground area. It
also highlighted that the anticipated increase in Australian Securities and Investments Commission
is primarily because the production went downhill over financial year 2022 period. Other factors
also include increases in prices for consumables and some contract labour for mill maintenance.
The Company does not consider that this AISC increase is a permanent reset of its cost
base, as production is expected to lift again at Duketon the upcoming year.
That’s all for now. We will be back again with the exclusive Hot Performer stock tomorrow.
Till then, keep watching Kalkine TV for the latest market updates and related insights.
I am Rachael, signing off.