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RNC Minerals on track to achieve 2020 gold guidance as it posts strong output in first quarter

For the three months to March 31, 2020, the company generated 24,816 ounces of gold

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At the end of March, 5,500 ounces remained in the hedge book put in place in connection with the June 2019 Higginsville acquisition and financing

RNC Minerals Corp (TSE:RNX), the Western Australia focused miner, told investors it remained on track to achieve its gold production guidance for 2020 of between 90,000 and 95,000 ounces as it reported strong first quarter output.

In the three months to March, the company said it generated 24,816 ounces of gold from the Beta Hunt and Higginsville mines.

READ: RNC Minerals to launch normal course issuer bid to purchase up to around 30.4mln of its own common shares

In a statement, the firm also said it expects to achieve its all-in-sustaining-cost (AISC) guidance of between US$1,050 and US$1,200 per ounce sold for 2020, assuming there is no significant interruption due to the coronavirus (COVID-19) pandemic.

As at the end of March, the miner's consolidated cash balance stood at C$38.4 million — an 11% increase from the C$34.7 million on December 31 last year due to the firm's gold hedge agreements.

Meanwhile, at the end of March, 5,500 ounces remained in the hedge book put in place in connection with the June 2019 Higginsville acquisition and financing, which will be depleted during the second quarter this year, noted RNC Minerals.

"The gold production results for the first quarter of 24,816 ounces is our third consecutive quarter of consistent gold production results since acquiring the Higginsville mill and mining operations in June of 2019," said Paul Andre Huet, the company's chief executive.

"During the quarter, our operations continued to generate strong cash flow despite the significant logistical challenges posed by the Australia bushfires as well as inclement weather across Western Australia in January. The fact we have achieved these strong results is a testament to the quality and dedication of our Australian operations team," he added.

Not expecting material disruptions

The RNC Minerals boss said that while the company does not anticipate "material disruptions in production as a result of COVID-19," it remains focused on "operational preparedness should interruptions occur that are out of our control."

Huet added that like its preparations ahead of the bushfires late last year, the firm was once again increasing ore stockpiles ahead of processing, now from three sources.

These are at Beta Hunt, Baloo and Fairplay North, which the firm has said previously could all be expanded.

Contact the author at [email protected]

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