EVN - Evolution Mining

finicky said:

If I recall your pie chart, you hold EVN @Sean K ? I will be considering it more closely. I have never liked it and the apparently poor high cost Red Lake acquisition confirmed my avoidance. But this result shows they can perform well despite the drag of Red Lake and their guidance is pretty persuasive for FY25. But based on a guess of not much more than 10% ROE for FY24 (I haven't done the sums) it seems about fairly priced on current earnings. But I am an optimist on the 'medium term' gold price and their hedging is trivial which I hadn't known before, so a more valuable company in future possibly.

Not Held

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Yeah, I hold EVN and they're performing well despite Red Lake. Guidance for FY25 looks good and I'm optimistic on medium-term gold prices. Worth a closer look!

Evolution Mining FY24 Earnings Call Highlights​

i hold EVN

Good afternoon
EVN having a good time of it of late.



Not holding
Have traded a million years ago

Kind regards
rcw1

Market Matters afternoon report:

Evolution Mining (EVN) +6.82% rocketed today after it released solid quarterly production numbers highlighting its continued low-cost profile and improving free cash flow. The group also announced positive drill results at existing sites. Executing operationally once again – big tick for EVN!
The rest of the gold sector maintained momentum – Regis Resources (RRL) +6.67% , Newmont Corporation (NEM) +2.58% and Northern Star (NST) +1.82% all up 3 out of the last 4 sessions.

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Evolution eyes nearly $2b of cashflow​

Evolution Mining has started the 2024–25 financial year strongly, delivering high-margin cashflow growth.

Evolution produced 193,554 ounces of gold and 19,059 tonnes of copper in the September quarter, with an all-in sustaining cost (AISC) of $1569 per ounce, maintaining one of the sector’s lowest-cost profiles.

The company’s operating mine cashflow reached $429 million, representing a 61 per cent margin of $2227 per ounce.

Evolution generated group cashflow of $108 million, bringing the company’s cash balance to $484 million, compared to $403 million at the end of June 2024.

“It is very satisfying to start the year in a positive way with a first quarter on plan with an improved safety performance,” Evolution Mining managing director and chief executive officer Lawrie Conway said.


“With spot prices well above the achieved prices in the September quarter and the business delivering to plan, we are on track for over $1.9 billion of operating cash flow for the year.”

Safety performance saw a significant improvement, with the company reducing its total recordable injury frequency (TRIF) by 7.4 per cent to 7.12.

Scheduled shutdowns at the Ernest Henry, Cowal, and Northparkes mines were completed successfully, supporting steady production levels.

Among its key operations, Red Lake delivered a record quarter with 37,319 ounces of gold production and a net mine cashflow of $67 million.

The Mungari mill expansion project, Mungari 4.2, remains on schedule and within budget.

Evolution said it remains on track for its 2024–25 production guidance of 710,000–780,000 ounces of gold and 70,000–80,000 tonnes of copper at an AISC of $1475–1575 per ounce.

Not Held

Nice uptick, still roughly a buck and a half off all time high.

Evolution is Market Matters' top pick for their active growth p/f for performance in early cal 2025.

Not Held
Not Buying

Like all commodities, gold is cyclical, but it’s in the middle of a bullish trend that could ultimately surprise many on the upside. EVN has been our preferred vehicle to play this move due to the company’s strong operational transformation in addition to its acquisition of an 80% stake in the NSW Northparkes copper and gold mine from China Molybdenum Co. (CMOC) this time last year when the price was gold prices were ~30% lower. EVN is now a 75% gold and 25% Copper play, and at MM, we’re also bullish on the industrial metal over the coming years, making EVN a great vehicle for exposure to our views.

• We are bullish toward EVN, looking for a break of its 2020 high through 2025/6.

FWIW From Market Matters today:

• Evolution Cut to Underperform at Macquarie; PT A$5.50
• Evolution Cut to Hold at Argonaut Securities; PT A$6
• Evolution Cut to Neutral at Citi; PT A$5.80

Not Held

i hold ( and have for over 10 years )

now investors should NOT confuse the EVN strategy with that of NST ( i hold ) and many other producers )

EVN started trimming costs and increasing efficiency and resilience several years back with the 'hub and spoke(s ) ' strategy , rather than several self-contained mines .

another strategy it leverages are 'earn-in' joint ventures on green/brown- field joint ventures

not as exciting as some peers but then again the strategy may be a winner for EVN

Not sure what the market would have been expecting but this looks pretty good. All gold producers should be bringing these sorts of numbers really.

Sean K said:

Not sure what the market would have been expecting but this looks pretty good. All gold producers should be bringing these sorts of numbers really.

View attachment 193077

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not really .. EVN had been working persistently to boost operating efficiency ( the 'hub and spoke ' strategy where possible ) and a determined approach to controlling/reducing costs , piggy-back that with a rising gold price .. all EVN needs is for copper prices to break out , to really get going .

other producers tended to just accelerate growth

i hold EVN

Looks like EVN outshone NST by a country mile on most metrics and more so the percentage improvements on the pcp.
NST does have tremendous ongoing growth capital commitments which are expected to be completed by mid FY27 I think? Although ramp up at KCGM will only be finished at the beginning of FY29 according to a graphic! KCGM growth capex dwindles out in FY27. Too much 'information' for EVN holders?
For comparison interest with @Sean K's EVN H1 results screenshot above, here are NST's H1 results.

Don't hold EVN

Northern Star H1 results