Perseus Mining Ltd (ASX:PRU) has revealed it produced 255,916 ounces of gold in FY18, up 45% on FY17 and lowered its royalties and sustaining capital average cost by 22% to US$1,039 per ounce.
The increased production resulted in 36.5% higher revenue to $378.1 million.
At 30 June 2018, the total value of cash and bullion on hand was $89.8 million, nearly double that which was held at the end of FY17.
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Perseus’s managing director Jeff Quartermaine said: “We are confident that Perseus is well on track to deliver value to its shareholders.
“The Sissingué mine which came on stream earlier this year will make a significant contribution to the bottom line when it operates for a full twelve months, rather than three months as was the case this year.
“Not to be outdone, the Edikan mine is also performing materially better than it has done in the past and is making a solid contribution to free cash flow.”
Developing third mine in FY19
Perseus is currently producing gold from its Edikan gold mine in Ghana and Sissingué gold mine in Côte d’Ivoire.
Yaouré, also in Côte d’Ivoire, is a development stage project and will become Perseus’s third gold mine when developed.
Quartermaine added: “In the coming financial year, we expect to commence development of our third operating mine, Yaouré and when this mine comes online in early 2021, Perseus’s production levels should be in the order of 500,000 ounces of gold per year.
“Subject to the gold price at that time, this should mean that Perseus will be in a position to generate material amounts of free cash flow and record significant profits.”
A new mine plan to maximise Edikan
Perseus has updated its life of mine plan (LOMP) for Edikan from 1 July 2018, following a re-estimation of Ore Reserves.
Proved and Probable Ore Reserves total 44.7 million tonnes of ore, grading 1.09 g/t gold and containing 1.56 million ounces of gold as at 30 June 2018.
Quartermaine added: “Having successfully brought our second operating mine, Sissingue, on stream earlier this year, we have achieved a level of operational flexibility that has enabled us to think strategically about how we execute our business at Edikan.
“Instead of focusing on satisfying expectations of Edikan that were created in a different market environment, we have designed a mine plan that seeks to maximise the production of profitable ounces rather than maximise ounces of gold produced at this mine.”