Karora Resources Inc (TSE:KRR), formerly known as RNC Minerals Corp (TSE:RNX), is still going strong in Western Australia as the firm posted its fourth consecutive quarter of robust gold output since acquiring the Higginsville mill and mining operations in June last year.
In a statement on Thursday, the Toronto-headquartered miner said it produced 24,078 ounces of the precious metal in its second quarter to June 30, selling 23,185 gold ounces.
The remaining ounces, which were generated, were sold in the first week of the third quarter, Karora told investors.
"I am extremely pleased with our performance during the second quarter where, despite the logistical challenges all miners were faced due to COVID-19 precautions, we delivered yet another rock solid quarterly performance," said Paul Andre Huet, the firm's chairman and chief executive.
At the end of June, Karora held cash of C$50.2 million, up 31% from the C$38.4 million held at the end of March. That came after the company paid into gold hedge agreements during the second quarter, but as of June 30, the group is completely unhedged and will have full exposure to spot gold prices, it noted.
Huet said the firm was in a stronger financial position than ever before and had made significant progress to "aggressively" reduce costs to achieve its target of lowering all-in-sustaining costs (AISC) costs to US$1,000 per ounce by the end of 2020.
"As part of these efforts we have negotiated almost 10% in reductions to our royalty burden on our Western Australian operations, achieved significant savings in phase one of our initiatives with vendors, increased workforce productivity and are on track to achieve significate general and administrative (G&A) savings," he said.
Karora's gold output for the first half of 2020 was 48,894 ounces positioning it well to achieve its 2020 gold production guidance of between 90,000 and 95,000 ounces and AISC of between US$1,050 and US$1,200 per ounce sold.
"With a growing cash balance of over $50 million, underpinned by steady state operations and our success in reducing costs in a rising gold price environment, Karora is in a very strong position to continue to deliver value to its shareholders and we are excited about our future."
Shares ticked up in Toronto 6.25% to stand at C$0.68 in early deals.
Contact the author at giles@proactiveinvestors.com
