Northern Star

NST

June 19, 2021 FAT-MIN-768
11.05
Speculative
high

1Q21; six now under one roof

Northern Star has reported its activities for the March 2021 quarter, and in doing so has brought together six operating mines, with Thunderbox, Carosue Dam and the Super Pit joining its stable of four mines. Northern Star has indicated that it remains on track to hit 2021 guidance.

Gold production for the March 2021 quarter came in at 366,000 ounces, with the following chart showing quarterly gold production:

Source: Northern Star

Due to the merger no comparatives will be made to earlier results and when made it will be on a like-for-like comparison. As Members can see from the above chart there was a significant uplift in overall gold production for the March 2021 quarter. It is this production uplift that we considered was a key feature of the merger for Saracen Shareholders and this is especially so in a rising gold price environment.  

Of the Saracen mines in the merger, Carosue Dam was the standout for the quarter, following the reporting of a 16.5% year-on-year (yoy) rise in gold production to 57,630 ounces. Driving the result were higher mill throughput and gold recoveries, with ore throughput up 47% yoy, to 858,175 tonnes, while gold recoveries jumped to 94% from 92% for a year earlier. The Jundee mine was the standout for the March 2021 quarter from Northern Stars stable following the reporting of a 16.63% yoy rise in gold production, to 63,648 ounces. Driving the result were higher mill throughput and gold recoveries, with ore throughput up 31% yoy, to 655,143 tonnes, while gold recoveries jumped to 91% from 89% for a year earlier. Management will, over the months ahead, become more familiar with the operations of the new mines and improve efficiencies and smooth the integration process.

Pro-forma guidance for 2021 is forecast to be in the range of 1.5 million to 1.7 million ounces of gold and remained unchanged. Despite integrating two operations into one, we believe the quality of Northern Stars assets and the experience of the management team are reflected in the unchanged 2021 guidance.

First time all-in sustaining costs (AISC) came in at A$1,598 an ounce for the March quarter, with quarterly AISC shown in the following chart:

Source: Northern Star


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