Quarterly production of 20,077oz from Eastern Goldfields operations in line with revised guidance. KOTH Mineral Resource increased to 4.1Moz, and Darlot Mineral Resource increased to 1.2Moz. Landmark $125 million capital raising underpins next phase of Red 5’s growth pathway to become a multi-asset, mid-tier Australian gold producer.
West Australian Gold Operations
Processing and Production
• Gold production for the March 2020 Quarter of 20,077 ounces (December 2019 Quarter: 23,346 ounces) and gold sales of 19,360 ounces (December 2019 Quarter: 27,740 ounces). All-in sustaining costs (AISC) of A$1,926 per ounce of gold sold for the Quarter (December 2019 Quarter: $1,628 per ounce).
• Production was in line with revised quarterly guidance announced on 12 March 2020. Quarterly production was impacted by short-term crusher and ball mill performance issues at the Darlot Gold Mine and lower grades than planned at the King of the Hills (KOTH) underground mine. Following the shutdowns, Darlot milled 92,153 tonnes in March 2020, a new milling record.
• Production remains unimpacted by the COVID-19 global pandemic, with Red 5’s proactive Management Response Plan implemented since February 2020 focusing on ensuring the health and safety of our people and limiting any disruption risk to our operations. The situation is evolving, and consistent with the broader gold sector, there remains some uncertainty and risk relating to potential impacts at Red 5’s operations.
• Production is expected to recover in the June 2020 Quarter, with an expected range of between 26,000 ounces to 30,000 ounces at an all-in sustaining cost of A$1,400 – A$1,525 per ounce. Following the March
2020 Quarter production result, FY2020 guidance is between 98,000 to 102,000 ounces at an AISC of A$1,570 – A$1,620 per ounce (previously 100,000 to 105,000 ounces at an AISC of A$1,550 – A$1,600 per
King of the Hills Final Feasibility Study (FFS)
• Final Feasibility Study for the stand-alone processing plant and integrated bulk mining operation at KOTH
advancing well and remains on track for completion in the September 2020 Quarter.
• Experienced construction project manager, Warren King, commenced with the Company in March 2020.
Finance and Corporate
• $125 million share placement undertaken in March 2020, significantly de-risking the equity funding component for the KOTH project development. Funds to be used for the development of an integrated bulk open pit and underground mine and stand-alone 4Mtpa process plant at KOTH, ongoing exploration and working capital.
• Option exercised in early April 2020 to complete the acquisition of the 62koz Great Western gold deposit, supporting Red 5’s ongoing strategy to increase Resources and extend mine life at the Darlot Gold Mining
• Group cash on hand and bullion at the end of March 2020 of A$14.11 million. The closing cash balance reflected lower-than-budgeted gold production, combined with expenditure on advancing project-related
development activities, additional sustaining capital expenditure for the crushing plant and repayment of the first instalment of the Macquarie Working Capital Facility.