RMS - Ramelius Resources

[finicky]

RMS down today @ 1.65

Missed commenting on its March Qtrly report.
Once again, tightly consistent results with guidance. Managed to execute within production guidance despite 7 days down due to mechanical failure at the mill.
Added $9M to cash despite paying $20M tax for fy20 during the Qtr, paying $10M for purchase of private land at Tampia project and paying scheduled capital development at Tampia and Penny.

Chart showing reasonable prospect of having made a major low. Has filled in a gap last week.

Interesting screenshot (2) from March conference comparing RMS with 8 'peer' producers. RMS ranked #1 in some primary metrics such as ROE, EBITDA margin.

 

[Clansman]

There will be many that don't know this but this is a top class mining company with excellent management.
Since the beginning of 2016, slightly more than 5 years, the SP increase is 565%. Northern Star has returned 675% coming off an almost identical base in nearly 7 years. EVN is next best with 215% in 5 years. Newcrest has returned 105% and Resolute 88%.
It's clear that Ramelius has astute management. Gold Road Resources has also been impressive returning more than 300% in the same period.

 

[finicky]

RMS @ 1.88

Best performing of my goldies today. Chart looking good with a caveat that the daily momentum indicators are not confirming. Irregular head and shoulders top centred on Sept 2020 has been more than answered by the subsequent fall into March 2021. The neckline at 1.90 is on verge of being up-tested. Likely to break through imo with the risk limited to a pullback, say to 1.60, then up again, jmo from a goldbug.

Daily

 

[barney]

The neckline at 1.90 is on verge of being up-tested. Likely to break through imo with the risk limited to a pullback, say to 1.60, then up again, jmo from a goldbug. Daily

Agree Finicky. Daily POG is definitely gaining some traction and many Goldies have been following suit. Even a couple of my little Spec battlers are looking better

 

[finicky]

RMS @ 1.70

Daily chart has turned a bit iffy, but surely the value is getting enticing? Working off eofy 2020 figures at Commsec I get:

Price/Book: 1.70 ÷ 0.64 = 2.65 (likely closer to 2.5 by now)
Book value has been in rising trend. Fy20 ROE was 22% but average over 5 years would be about 15%
P/E: 1.70 ÷ 0.16 = 10.6

Held
Not buying as I sold half back at around 0.80 (hence psychological barrier)

Started mining Tampia deposit ore and that is high grade for open pit (AISC expected to be $1,167/oz) and will contribute a significant amount of the feed to Edna May in fy22, starting July.

Daily

 

[barney]

RMS @ 1.70
Daily chart has turned a bit iffy, but surely the value is getting enticing? Working off eofy 2020 figures at Commsec I get:

4% drop today not ideal, but Gold/Goldies across the board look similar, plus plenty of punters holding profits since March

Half year 2021 results were full of good results.

Should establish a new base once the POG settles and the EOFY Sellers leave the building.

 

[finicky]

@barney
Yep, one goldie I am not a bit worried about is RMS - aside from a general crash that is. Nothing but steady progress for the years that the m.d has been in charge, his hub and spoke model and growth by acquisition been working fine.
Back to1.60 is looking very possible now, has gapped down after well and truly over balancing the uptrend.

 

[rederob]

Back to1.60 is looking very possible now, has gapped down after well and truly over balancing the uptrend.

Downside to $1.40 and it's still within trend:

https://www.tradingview.com/x/pCaGCMox/
With some decent recovery of POG since this morning's demise, RMS might have bottomed for the near term.
Like you, I am not worried about RMS as it is still making good profits on the present gold price. And I reckon POG will tick back over $2000 before the year ends.
While nothing is certain, the general rule in a bull market is that stock return to and then overtake their previous highs.

 

[finicky]

After overbalancing the uptrend ..

 

[mullokintyre]

quarterly report out.
Record year of production , in the midpoint of prediction from last year, though slightly down on final quarter guidance.
Costs in midpoint of AISV guidance.
Downside is a very small cash gold increase.
Will have to wait and see the fin report to see whether they received a lot less for gold sales, or they spent up big. (probably a bit of both).
Still one of the better goldies, paying 25FF divvy.
Mr Market seemed not to be too pleased about the report, although most goldies are marginally down on the open, RMS is down 5%.
Only down side I see is the AGE of the Mt Edna mine, which will more likely bring a decline in production.
Mick

 

[finicky]

Only down side I see is the AGE of the Mt Edna mine, which will more likely bring a decline in production

To my reading there looks to be a very good chance of a big cutback operation at Edna May for a stage 3 pit. Its still only at study stage but as long as the gold price holds up there's over 6 years of mill material there if they go ahead with this option.

From Jan 28 2021 announcement

There's also the satellite feed from the Tampia mine

 

[Sean K]

There's also the satellite feed from the Tampia mine

And satellite feed from MGV ;-)

 

[Beaches]

quarterly report out.
Record year of production , in the midpoint of prediction from last year, though slightly down on final quarter guidance.
Costs in midpoint of AISV guidance.
Downside is a very small cash gold increase.
Will have to wait and see the fin report to see whether they received a lot less for gold sales, or they spent up big. (probably a bit of both).
Still one of the better goldies, paying 25FF divvy.
Mr Market seemed not to be too pleased about the report, although most goldies are marginally down on the open, RMS is down 5%.
Only down side I see is the AGE of the Mt Edna mine, which will more likely bring a decline in production.
Mick

RMS has just started hauling ore from Tampia
Capital costs were $26mil (not sure how much of this was included in the cash drawn down for this quarter)
Which would provide some explanation for the small increase in cash/gold held.

17June2021​

FIRST ORE MINED AT TAMPIA GOLD MINE​

HIGHLIGHTS​

▪First ore mined, following commencement of open pit miningi n late April 2021​

▪Haulage to Edna May processing facility to begin early July 2021​

▪Accommodation village and major site earthworks largely complete​

▪Mine workforce now at ~85% capacity with ramp up continuing​

Tampia will also add to the gold production going forward as no gold from Tampia was included in the recent results. AISC for Tampia is good at A$1,167/oz.

Not sure how good stage 3 of Edna May will be for the company. $165mil capital cost for a current estimated AISC of A$1,540/oz (and possibly higher given the rising costs).

Overall I like the look of RMS.
.

 

[finicky]

And satellite feed from MGV ;-)

I'm hoping RMS is a potential buyer of MGV's Cue project but if so, it would be for RMS's Checkers' mill at Mt Magnet not the Edna May camp. Cue's projects are only 40+ kms by direct sealed road from Checkers. I'd also have to ask what Evolution's scheme might be: EVN has a 4% shareholding of MGV and is drilling Lake Austin in a jv next door to MGV's 100% owned Cue prospects. Maybe RMS will have too much on its plate if it intends to go ahead with an expensive development of a stage 3 to the Edna May open pit?

Where MGV's Cue project is, relative to Mt Magnet's Checkers' mill

Where RMS assets are situated

 

[noirua]

A share that in the last collapse fell to as low as 4.5c which makes its performance one of Australia's most outstanding. However, before it fell to 4.5c it had been over $2 per share listing it among the worst performers. So it is a share to be wary about in case the story repeats itself.

 

[finicky]

@noirua
Far from an identical company to its past though if you consider performance during 7 years of tenure of the current M.D and his type of operation (hub and spoke). It's subjective but I'd rank the M.D up with best, such as ex M.D of Saracen Mineral Holdings SAR (now M.D of NST) and the ex M.D of NST. Added to which it has different mining assets to that period such as Edna May, Tampia and Penny West as well as the continuing Mt Magnet with its acquired satellite deposits and recently self discovered deposits such as Eridanus. Ramelius will doubtless be hit hard in the coming collapse though, but what won't?

 

[rederob]

RMS's quarterly activity report with FY22 guidance is very promising:

Chartwise RMS was most recently a buy in March:

 

[mullokintyre]

2 big announcements today.
Sold the royalty agreement it had over Lithium tenements fro 30 mill.
27% increase in mine planning resources.
Production will decline after FY25 without m\ extensions.
market obviously thought it a good result, RMS up 7% early, back a bit to 5%.
Looking for 1.90 to offload some of the recently bought at lows.
Still my biggest goldie.
Mick

 

[rederob]

Adding to the above, present mine plan sees production through to 2030:

The above assumes no further discovery and current cut-off grades. But exploration expenditure for FY22 alone is budgeted to be A$32M, so there's a good chance of converting some to a lot more of inferred resources to reserve and indicated resources.

 

[mullokintyre]

Annual report out looks good.
Gold production up 18%
Revenue up 38%.
Net cash and bullion up 45%
2.5% FF divvy.
The down side is a 13% increase in AISC.
Lower production guidance for next year.
AISC forecast up from 1317 this year to between 1425 to 1525.
Will hold at this point, though not as bullish on gold as I once was.
Mick