War vor 9 Std in meinem Postfach;-))
HARTLEYS LIMITED RESEARCH REPORT UPDATE
Please find below an extract from the latest research paper on Focus Minerals by Perth based broking firm Hartleys. Please follow the link below for the full analysis:
Record profit with production increasing
Focus Minerals Ltd ("Focus", "FML", "Company") has reported an audited net profit for FY10 of A$10.9m, at the upper end of guidance. The profit, which is a record result for the Company, was generated from a 50% increase in production to 62,296oz gold at cash costs of A$792/oz (including royalties). Revenue from gold sales amounted to ~A$72m with a further A$3.3m received from toll-treating income. Cash costs have increased on FY09 costs (A$603/oz) due to the increased tonnes processed and introduction of lower grade surface stocks into the processing mix.
Completion of toll-treatment sets platform for growth
The final toll treatment of third party ore has been completed ahead of schedule to set the foundation for improved Dec’10 quarter production. The toll-treatment has been the main reason for the high cash costs reported in the Jun’10 quarter and expected in the Sep’10 quarter. The impact of losing close to one month of milling capacity to processing third party ore will see production for the Sep’10 quarter at similar levels to Jun’10, within guidance of 12-14Koz gold. To achieve FY11 target production of 100Koz, Focus will need to produce on average >28Koz gold for the next three quarters. With increased production at these levels for the Dec’10 quarter, cash costs should return to more representative levels at ~ A$750-850/oz.
The Mount set for next phase of development
The Mount, situated 80kms to the south of the main production centre at Tindals, continues to exceed expectations with an average mined grade of 8.4g/t gold. Trial mining continues in anticipation of moving to the next phase of development during the Dec’10 quarter. This next phase involves the construction of a larger decline to facilitate the movement of larger underground mining equipment to enable an increase in the scale of stoping. Construction of the decline could start as early as Nov’10. The Mount is forecast to produce ~60Kozpa gold once fully developed. The deposits mineralised system has a current footprint of over 300m; made up of 15 parallel sub-vertical lodes that are open at depth. These have considerable potential for resource growth and mine life extensions. The average distance between the lodes is 15- 20m, providing for low lateral development costs and efficient mining. We see The Mount development as being critical to the growth aspirations of the Company.
Recent exploration success at TMC more to come
Focus has intersected more high-grade gold at its recently discovered Perseverance North orebody within the Tindals Mining Centre (TMC). The orebody was delineated through drill testing of electromagnetic (EM) geophysical targets, with recent drilling confirming that the mineralisation remains open at depth and along strike and can be accessed with only 75m of horizontal development from the existing Perseverance underground workings. The results included 4.4m @ 13.3g/t Au and 3.9m @ 3.2g/t Au, while surface drilling of a second EM target, parallel to the Perseverance North discovery, returned 2m @ 7.4g/t Au. With a resource base of 2Moz and production growth to 100Kozpa and beyond, we continue to rate Focus Minerals Limited as a Speculative Buy. |
Thread abonnieren
