Perseus Mining Ltd (ASX:PRU, TSX:PRU, OTC:PMNXF) has reaffirmed its production guidance on delivering a “strong” September quarter with 132,800 ounces of gold produced at a low AISC of US$937 per ounce, according to Foster Stockbroking
The company reiterated it is comfortably tracking to December half guidance group production of 242,500 to 272,500 ounces and US$1,080 to 1,190 per ounce AISC.
PRU shares are currently trading at A$1.74 with a market cap of A$2.38 billion.
Following are excerpts from Foster’s research report:
Sissingue impacted by rain, but shortfall to be made up
Edikan and Yaoure performed well, offsetting Sissingue for which mining and gold output was negatively impacted by heavy rainfall.
However PRU expects Sissingue to make up the production shortfall during the December quarter, the mine so far performing well in October with the rains having abated.
Cash bolstered to US$594 million
PRU finished the quarter with US$594 million cash, up by US$72 million from end June, with group cash margin of US$999 per ounce contributing to operating cash flow of US$135 million during the quarter.
The company remains on the watch for acquisition opportunities, but will contemplate bonus dividend, capital return, or share buyback if no compelling targets are identified.
Looks inexpensive versus peers
PRU consensus FY24e PE is 8x, about 40% below ASX golds' 13x PE. We think the market is too aggressively discounting Africa risk, and not accounting enough for a strong balance sheet, portfolio of operations, high cash margin and management track record.
In the current market environment where gold is attractive, PRU certainly should be considered by investors.