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MarketScreener Homepage  >  Equities  >  Australian Stock Exchange  >  Evolution Mining Limited    EVN   AU000000EVN4

EVOLUTION MINING LIMITED

(EVN)
  Report
End-of-day quote. End-of-day quote Australian Stock Exchange - 01/15
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01/06Trillium Gold Advancing Multiple Red Lake Projects
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Evolution Mining : September 2020 Quarterly Report

10/26/2020 | 05:15pm EST

QUARTERLY REPORT - For the period ending 30 September 2020

HIGHLIGHTS

Sector leading cash generation

  • Mine operating cash flow of A$272.3 million
  • Net mine cash flow of A$183.4 million
    • Record net mine cash flow at Ernest Henry (A$83.2M) and Mungari (A$44.9M)
    • All operations generated positive cash flow post capital
  • Group cash flow of A$118.9 million
  • Net bank debt of A$180.3 million (30 Jun 2020: A$196.4M) post FY20 final dividend of A$153.8 million

Sustainability

  • Maintained 'A' rating in MSCI ESG Ratings assessment
  • COVID-19continues to be proactively managed with no material impact on operations

Operations tracking ahead of FY21 plan

  • Gold production of 170,021 ounces (excludes any contribution from Cracow which was divested on 1 July)
  • All-inSustaining Cost (AISC)1 of A$1,198 per ounce (US$857/oz)2
  • All-inCost (AIC)3 of A$1,663 per ounce at an AIC margin of A$871 per ounce

Exploration drilling results continue to demonstrate resource growth and increasing confidence

  • Red Lake's Cochenour: 3.35m (1.67m etw) grading 296.6g/t Au from 135.9m (C37230)
  • Cowal's GRE46: 34m (23.8m etw) grading 5.5g/t Au from 529m (GRUD0186)

Delivering significant organic growth pipeline

  • Red Lake
    • Transformation plan progressing on schedule
    • Initial JORC Code 2012 Mineral Resource estimate of 11 million ounces
    • Six diamond drill rigs currently operating underground to capture further exploration upside
  • Cowal
    • Underground mine development application submitted for regulatory approval
    • Integrated Waste Landform (IWL) Stage 1 completed with first deposition achieved in October
    • Board and regulatory approval received in October to develop Galway exploration decline

Consolidated production and sales summary

Units

Dec Qtr

Mar Qtr

Jun Qtr

Sep Qtr

FY20

FY20

FY20

FY21

Gold produced

oz

170,890

165,502

218,104

170,021

By-product Silver produced

oz

137,262

118,224

233,252

164,069

By-product Copper produced

t

5,572

4,832

6,684

5,552

C1 Cash Cost

A$/oz

778

767

761

889

All-In Sustaining Cost1

A$/oz

1,069

991

1,088

1,198

All-In Cost3

A$/oz

1,584

1,584

1,562

1,663

Gold sold

oz

173,408

167,374

218,685

172,759

Achieved gold price

A$/oz

2,091

2,366

2,500

2,534

Silver sold

oz

144,757

118,472

218,239

173,909

Achieved silver price

A$/oz

24

27

24

35

Copper sold

t

5,612

4,801

6,585

5,598

Achieved copper price

A$/t

8,802

8,174

8,192

9,668

  1. Includes C1 cash cost, plus royalties, sustaining capital, general corporate and administration expense. Calculated per ounce sold
  2. Using the average AUD:USD exchange rate of 0.715 for the September 2020 quarter
  3. Includes AISC plus growth (major project) capital and discovery expenditure. Calculated per ounce sold

Evolution Mining Limited Quarterly Report September 2020

1

OVERVIEW

Evolution continues to be recognised for its Sustainability performance, maintaining an 'A' rating in the MSCI ESG Ratings assessment. The Company also ranked among the top five industry leaders globally for 'Health and Safety' and 'Business Ethics'.

Leading safety indicators are trending well with an increase in field safety interactions and a 31% increase in hazard reporting. Group Total Recordable Injury Frequency (TRIF)1 at 30 September was 7.1 (30 June 2020: 6.8). Key initiatives during the quarter to improve safety performance included an increased focus on back to basics, quality field leadership and high-quality focused safety interactions.

As part of Evolution's ongoing Community Investment efforts, two Sustainability Projects were approved during this quarter. These were a Fire Recovery Support project at Red Lake and an upgrade to the Mt Perry Summit Walk at Mt Rawdon.

COVID-19 continues to be proactively managed with no material impact to operations.

Group gold production for the September 2020 quarter was 170,021 ounces (Jun qtr: 218,104oz) at an AISC of A$1,198/oz (Jun qtr: A$1,088/oz). Using the average AUD:USD exchange rate for the quarter of 0.715, Group AISC equated to US$857/oz which places Evolution at the bottom of the cost curve amongst major and mid-tier global gold producers. All-in costs (AIC) of A$1,663/oz resulted in an AIC margin of A$871/oz.

As at 30 September 2020, Evolution had cash in the bank of A$369.7 million and bank debt of A$550.0 million post the cash payment of A$153.8 million for the final FY20 dividend.

Evolution delivered mine operating cash flow and net mine cash flow of A$272.3 million and A$183.4 million respectively (Jun qtr: A$352.1M; A$224.5M). Mine capital investment for the quarter was A$88.1 million (Jun qtr: A$111.5M).

Standout operational performances for the quarter:

  • Ernest Henry produced 24,569oz at an AISC of A$(515)/oz generating record net mine cash flow of A$83.2 million
  • Mungari produced 35,370oz at an AISC of A$1,115/oz generating record net mine cash flow of A$44.9 million

On 13 August 2020, Evolution announced its first JORC Code 2012 Mineral Resource estimate at Red Lake of 48.1Mt grading 7.1g/t for 11.0Moz2. This includes 4.3Moz at an average grade of 10.5g/t in Upper Campbell. Work has commenced on the estimation of a maiden JORC Code Ore Reserve which is planned to be released with Evolution's Group Mineral Resources and Ore Reserves Statement in the March 2021 quarter.

On 30 September 2020 a major milestone was achieved for the Cowal underground mine development with the submission of the Significant State Development (SSD) Application and the Modification 16 Development Application to the New South Wales Department of Planning, Industry and Environment. An Environmental Impact Study forms part of the SSD Application and is on public display until 22 November 2020.

Subsequent to the end of the quarter, the Board approved development of the Galway exploration decline which will enable additional drilling to increase underground Ore Reserves and will also be used for future production. The 2,300 metre decline has received regulatory approval. This is another important milestone in growing Cowal's production to over 350,000 low cost ounces per annum.

Drilling at Cochenour, Red Lake, targeting new discoveries returned strong results with the best intersections of 1.27m grading 11.72g/t Au from 265.75m (Thor) and 0.31m grading 627.75g/t Au from 273.95m (Voss). Resource definition drilling is increasing confidence in geological and grade continuity to grow the short to medium term mining inventory at Cochenour and Twin Otter.

Numerous significant drill intersections at the Cowal underground including 34m (23.8m etw) grading 5.5g/t Au from 529m (GRUD0186) continued to provide robust infill results. Extensional resource drilling down plunge of Regal and Dalwhinnie returned a best result of 19m (13.3m etw) grading 15.6g/t Au from 635m (1535DD544B). Results will be reflected in the next resource model update.

  1. Total Recordable Injury Frequency (TRIF): The frequency of total recordable injuries per million hours worked.
  2. This information is extracted from the report entitled 'Red Lake 11 Million Ounce JORC Code Mineral Resource" released to the ASX on 13 August 2020. See page 18 of this release for further details.

Evolution Mining Limited Quarterly Report September 2020

2

OVERVIEW

Group safety performance (TRIF)

8.4

7.2 6.8 7.1

FY20 Q2

FY20 Q3

FY20 Q4

FY21 Q1

Group production (koz)

218.1

170.9

165.5

170.0

FY20 Q2

FY20 Q3

FY20 Q4

FY21 Q1

Group operating mine cash flow

(A$M)

352.1

233.1

257.4

272.3

FY20 Q2

FY20 Q3

FY20 Q4

FY21 Q1

Group AISC (A$ per ounce)

1,069 991 1,088 1,198

FY20 Q2

FY20 Q3

FY20 Q4

FY21 Q1

Summary of key projects

Cowal

Significant State Development and Modification 16 applications submitted

Underground

Feasibility Study progressing on schedule

Galway exploration decline received Board and regulatory approval to

enable additional underground drilling

Integrated Waste Landform

Stage 1 completed and first deposition achieved in October

Stage H cutback

On track for completion by the end of FY21

Satellite open pits

Pre-Feasibility Study commenced for satellite pits outside E42

Red Lake

Transformation plan

Progressing in line with schedule

Mineral Resources

Initial JORC Code 2012 Mineral Resource of 11Moz declared

Ore Reserves

Initial JORC Code 2012 Ore Reserves expected in March 2021 quarter

Decline

Surface decline study initiated to develop upper level ore access. Results

expected in March 2021 quarter

Processing

Pre-Feasibility Study to commence assessing long term processing

options. Results expected in June 2021 quarter

Ernest Henry

Drilling below 1200RL

CY2020 drill program of 18,000m progressing in line with plan

Mungari

Processing

Castle Hill processing study progressing. Outcome expected in June 2021

quarter

Evolution Mining Limited Quarterly Report September 2020

3

OVERVIEW

September 2020 quarter production and cost summary1

Sep 2020 quarter

Units

Cowal

Ernest

Red

Mungari

Mt

Mt Carlton

Group

Henry

Lake

Rawdon

UG lat dev - capital

m

0

263

1,479

532

0

450

2,723

UG lat dev - operating

m

0

1,680

1,199

137

0

358

3,373

Total UG lateral

m

0

1,942

2,678

669

0

808

6,097

development

UG ore mined

kt

0

1,659

117

101

0

38

1,915

UG grade mined

g/t

0.00

0.59

6.42

3.93

0.00

5.48

1.22

OP capital waste

kt

3,850

0

0

1,316

1,026

0

6,193

OP operating waste

kt

606

0

0

89

971

1,039

2,704

OP ore mined

kt

410

0

0

393

463

112

1,379

OP grade mined

g/t

0.87

0.00

0.00

1.09

1.03

2.39

1.11

Total ore mined

kt

410

1,659

117

494

463

150

3,294

Total tonnes

kt

2,116

1,691

120

515

849

234

5,526

processed

Grade processed

g/t

0.91

0.59

6.35

2.35

0.83

2.40

1.11

Recovery

%

83.9

76.5

93.6

90.9

88.5

81.8

85.9

Gold produced4

oz

51,774

24,569

26,638

35,370

20,024

11,646

170,021

Silver produced

oz

39,980

21,035

1,169

3,145

23,719

75,021

164,069

Copper produced

t

0

5,040

0

0

0

511

5,552

Gold sold

oz

49,929

27,560

26,053

35,865

20,760

12,592

172,759

Achieved gold price

A$/oz

2,501

2,505

2,586

2,557

2,467

2,660

2,534

Silver sold

oz

39,980

21,035

1,169

3,145

23,719

84,861

173,909

Achieved silver price

A$/oz

34

27

36

35

35

36

35

Copper sold

t

0

5,040

0

0

0

558

5,598

Achieved copper price

A$/t

0

9,720

0

0

0

9,193

9,668

Cost Summary

Mining

A$/prod oz

145

1,045

389

477

1,670

527

Processing

A$/prod oz

677

394

307

603

731

489

Administration and

A$/prod oz

144

282

102

161

553

212

selling costs

Stockpile adjustments

A$/prod oz

(14)

(97)

98

144

66

22

By-product credits

A$/prod oz

(26)

(2,018)

(2)

(3)

(103)

(706)

(361)

C1 Cash Cost

A$/prod oz

926

(983)

1,623

893

1,281

2,313

889

C1 Cash Cost

A$/sold oz

960

(876)

1,659

880

1,235

2,140

875

Royalties

A$/sold oz

75

194

0

66

125

221

97

Gold in Circuit and

A$/sold oz

(26)

11

9

(35)

280

12

other adjustments

Sustaining capital2

A$/sold oz

10

167

377

151

138

17

137

Reclamation and other

A$/sold oz

8

27

9

74

16

18

adjustments

Administration costs3

A$/sold oz

59

All-in Sustaining

A$/sold oz

1,026

(515)

2,074

1,115

1,536

2,674

1,198

Cost

Major project capital

A$/sold oz

837

0

271

302

237

(0)

374

Discovery

A$/sold oz

75

0

85

105

4

59

90

All-in Cost

A$/sold oz

1,938

(515)

2,430

1,522

1,777

2,732

1,663

Depreciation &

A$/prod oz

190

1,400

168

374

604

658

480

Amortisation4

  1. All metal production is reported as payable. Ernest Henry mining and processing statistics are in 100% terms while costs represent Evolution's cost
  2. Sustaining Capital includes 60% UG mine development capital. Group Sustaining Capital includes A$2.36/oz for Corporate capital expenditure
  3. Includes Share Based Payments
  4. Gold production at Red Lake is gold production Payable

Evolution Mining Limited Quarterly Report September 2020

4

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Evolution Mining Limited published this content on 27 October 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 October 2020 22:14:01 UTC


© Publicnow 2020
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Chart EVOLUTION MINING LIMITED
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Evolution Mining Limited Technical Analysis Chart | EVN | AU000000EVN4 | MarketScreener
Technical analysis trends EVOLUTION MINING LIMITED
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TrendsBearishBearishNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 15
Average target price 5,31 AUD
Last Close Price 4,61 AUD
Spread / Highest target 51,8%
Spread / Average Target 15,2%
Spread / Lowest Target -4,56%
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Jacob Klein Executive Chairman
Robert Fulker Chief Operating Officer
Lawrie Conway CFO, Finance Director & Executive Director
Evan Elstein Secretary, Vice President-IT & Community Relations
James Edward Askew Non-Executive Director
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