Evolution’s four-year growth plan has been downgraded less than a year after launch and adds to recent bad news from gold miners St Barbara and Ramelius.
Evolution Mining has downgraded gold production guidance for this year and future years, as pandemic disruptions and delays onThe downgrade came as copper and gold miner OZ Minerals downgraded its 2022 copper production target by 13 per cent after rain, staffing challenges related to the pandemic and a conveyor belt failure.Evolution shares slid 18.5 per cent to $2.76 after the news was issued early on Monday.
The downgrade means Evolution’s gold production has declined for a fifth consecutive year and was blamed on a high rate of pandemic-related staff absenteeism at the Mungari mine in Western Australia, as well as heavy rains at Cowal. Even if the company did 5 per cent better than its new 2024 target, it would still fall short of the 880,000 and 950,000 ounce range that it promised for 2024 just 11 months ago.Evolution expressed confidence that Red Lake would still deliver for the company, but would just take longer to achieve its potential.
Red Lake was marginally cash flow positive in the March quarter, but was a cash drain once capital spending was included.
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