Release Date: August 29, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Westgold Resources Ltd (WGXRF, Financial) achieved a $95 million profit for FY24, demonstrating significant financial improvement.
- The company declared a total of $0.0225 per share in dividends for FY24, reflecting a commitment to shareholder returns.
- Westgold Resources Ltd (WGXRF) completed its merger with Karora, enhancing its production capacity to over 400,000 ounces per annum.
- The company has successfully transitioned to hybrid power, reducing diesel consumption, carbon emissions, and operational costs.
- Westgold Resources Ltd (WGXRF) remains debt-free with a $100 million corporate facility yet to be drawn, indicating strong financial health.
Negative Points
- The decision to pause mining at Paddy's Flat negatively impacted year-on-year production comparisons.
- Trade payables increased significantly from $78 million to $148 million due to heavy investment in growth projects.
- The company faces challenges in maintaining and further improving its safety culture, despite significant progress.
- Depreciation charges are expected to increase as new projects like Great Fingall come online.
- The company has a history of poor performance with hedging, which may pose risks if gold prices decline.
Q & A Highlights
Q: Can you please remind us of the announcement disclosure schedule that will lead into FY25 guidance?
A: The schedule ahead is quite simple. We'll be going with our updated reserve and resource statement early in September, shortly followed by the FY25 guidance, one really feeds into the other. (Wayne Bramwell, Managing Director)
Q: Can you comment on the increase in trade payables from $78 million to $148 million?
A: The increase in trade payables is due to heavy investment in our growth projects such as Great Fingall, Fender, and the Big Bell long-hole open stop. Naturally, the creditors and payments will increase as a result of the investment. (Su Hau Heng, Chief Financial Officer)
Q: Can you provide updates on key management changes and timing on new appointments?
A: The most recent change to the executive team is the appointment of Andrew McDougall as Chief Technical Officer. As we expand our operations, we need to strengthen our executive team. Andrew has been with us for just over four months and has been a key member. (Wayne Bramwell, Managing Director)
Q: Which underground mines in Murchison might return to production in FY25?
A: Of the mines currently on care maintenance, the most likely to return to production is Fortnum Trident, which is being reworked as we speak. (Wayne Bramwell, Managing Director)
Q: How big will South Junction-Bluebird get production-wise?
A: Bluebird-South Junction is targeting a 1.2 million tonne per annum run rate by the end of this year. However, we keep drilling and haven't found the edges of it yet, so the potential scale is much larger. (Wayne Bramwell, Managing Director)
Q: When can we expect first ore from Great Fingall?
A: First ore from Great Fingall is planned for Q4 of this financial year. (Wayne Bramwell, Managing Director)
Q: What is the timeline for bringing Spargo underground and Pioneer 3 open pit into production?
A: We are currently reviewing all targets, including Spargo and Pioneer 3, but there are other large opportunities in the Higginsville area that we are also considering. (Wayne Bramwell, Managing Director)
Q: What other levers might Westgold use to further enhance the business?
A: We can drive more cost out and profitability up by leveraging the scale of our business and taking a different approach to our operations, especially in the Southern Goldfields. (Wayne Bramwell, Managing Director)
Q: Why did depreciation charges come down in FY24 relative to FY23?
A: The decrease in depreciation charges is due to the increased resource base and the care and maintenance status of Paddy's Flat. (Su Hau Heng, Chief Financial Officer)
Q: Are you expecting to release guidance for two to three years or just for FY25?
A: At this stage, we are only releasing guidance for FY25. (Wayne Bramwell, Managing Director)
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
