Dacian meets revised guidance

DACIAN Gold’s Mt Morgans operation has met its revised guidance for the June quarter.
Dacian meets revised guidance Dacian meets revised guidance Dacian meets revised guidance Dacian meets revised guidance Dacian meets revised guidance

Mt Morgans near Laverton in Western Australia

Mt Morgans produced 36,658 ounces of gold at an all-in sustaining cost of A$1519 an ounce.

The figure fell within revised guidance of 36,000-38,000oz at AISC of $1500-1600/oz.

Up until the start of last month, Dacian had expected to produce 50,000-55,000oz at AISC of $1050-1150/oz in the June quarter.

That was revised last month due to grade issues at the Westralia underground and lower than expected productivity due to contractor performance.

The company's full quarterly will be released later this month.

Last week, Dacian released an eight-year life-of-mine plan for Mt Morgans, outside Laverton in Western Australia.

The outlook includes FY20 guidance of 150,000-170,000oz at all-in costs of $1400-1500/oz, or $1450-1550/oz consolidated, weighted to the second half.

Dacian expects to produce an average 170,000oz per annum at AIC of $1340-1440/oz over the next five years.

"While the recently updated mine plan provides additional visibility for Dacian (our valuation looks through the commissioning phase), we balance this against near-term risk associated with ramp-up and the potential implications for existing reserves given the recent reconciliation issues," RBC Capital Markets analyst Paul Hissey said.

"We expect sentiment is likely to drive stock performance in the near-term."

RBC maintained a sector perform rating and $1 price target.

Shares in Dacian rose 2.5% to 62c in early trade. The stock dropped as low as 37.5c last month.