Lending Association

Evolution Mining declares another interim dividend

Another interim dividend for shareholders in Evolution Mining (ASX:EVN) after a modest result for the six months to December, highlighted by the consolidation of its position in the growing central NSW gold and copper province.

Evolution bought 80% of the Northparkes copper and gold mine to go with its much larger Lake Cowal operation in the same area.

Directors on Wednesday declared a 2 cents a share payout, unchanged from a year ago, marking the 22nd consecutive payout to shareholders.

Statutory net profit of $97 million for the six months to December 2023, down a fraction from the $101 million for the December 2022 period. This was after a 53% increase in underlying net profit after income tax to $158 million from $103 million a year ago after a 28% lift in underlying EBITDA to $573 million, from $446 million in the December 2022 half.

The improvement came from the surge in gold prices late in the half to more than $A3,000 an ounce.

That helped push up revenue 18% to $1.34 billion and offset a dip in gold and copper production in the December 2023 quarter from a year earlier.

Gold production for the half was 319,377 ounces (327,502 ounces a year earlier) at an All-in Sustaining Cost of $A1,615 per ounce (US$1054/oz). The cost was up from $A1,307 an ounce for the December 2022 half.

Copper production in the latest half-year fell to 27,635 tonnes from 29,951 tonnes a year earlier.

The company said group production and cost guidance for 2023-24 “is expected to be within the range of 789,000 ounces (±5%), copper production of 62,500 tonnes (±5%) and AISC of $1,340/oz (±5%).”

The company released new reserves data at the same time as the interim results.

“Mineral Resources estimated to contain 32.7 million ounces of gold and 4.1 million tonnes of copper – an 8% increase of 2.3 million ounces of gold and 134% increase of 2.4 million tonnes of copper compared with the estimate as at 31 December 2022.

Evolution said it saw a 15% increase in gold Ore Reserves (net of depletion) to 11.5 million ounces and a 100% increase in copper Ore Reserves to 1.3 million tonnes – “an increase of 1.5 million ounces of gold and 659 thousand tonnes of copper compared with the estimate as at 31 December 2022.”

CEO, Lawrie Conway, said the higher reserves “incorporate compliant Mineral Resource and Ore Reserve estimates for Northparkes. The feasibility study for the E22 orebody is progressing, and we anticipate the outcomes of that study to be available early in the June 2024 quarter, which will inform future mining options at the asset.”

“The first half of FY24 saw Evolution return to net cash generation, realizing the benefit of capital invested in growth projects over the past couple of years.

“This will see us deliver increased cash flows in the second half of FY24, and beyond, as we deliver on our commitment to building free cash flow, deleveraging, and increasing shareholder returns. Based on the positive cash generation and outlook for the year, we have declared our 22nd consecutive dividend of 2.0 cents per share.