Australian Mining Stocks Gold shares
Ramelius Resources (RMS) is a Western Australian-focused unhedged gold producer with mining operations at Wattle Dam near Kambalda and milling facilities at Burbanks near Coolgardie.
RMS is benefitting from its strong operations and boom times for gold, making it one of the hot gold shares over the past year.
The group is a low-cost operator with no debt and in a strong financial position with $90 million in cash on hand.
Fortunately, recent drilling confirms mine life upside, with a new high grade zone discovered at depth (as at February 2011).
Wattle boasted production of 91,700 oz in 2010 at a total cash cost of $458 per ounce.
It clocked record production of 26,668 oz in the recent December quarter and mine cash flow of $25.6 million.
Wattle anticipates production of 90,000 oz in 2010/11.
For the half ending December 2010, RMS recorded a net profit of $32 million and announced capital return and a dividend totalling 7 cents per share.
RMS is in a strong financial position with $86 million in cash and gold on hand with no debt.
The group has a market capitalisation of $294 million and clocked a net profit of $20 million for FY10.
For the year, total cash costs of $458 per ounce were produced and the group saw production of 91,700oz of gold in 2010.
Gold has generally hovered around US$1,360 an ounce lately, with the precious metal seeing a bull market over the last decade, and repeatedly hitting historical new highs.
Gold prices rose at an average of 18% a year over the last decade and companies such as RMS are benefitting from the boom. Indeed, the likely continuation of the boom means RMS is currently one of the Australian Mining stocks to watch.
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