The Evolution Mining Ltd (ASX: EVN) share price could be on the move this morning after an operations update by the Aussie miner.
What could move the Evolution Mining share price?
Evolution reported its numbers for the December 2019 quarter and provided some key updates on various operations.
Group gold production for the quarter totalled 170,890 ounces (oz) at an all-in sustaining cost (AISC) of A$1,069 per ounce. Year-to-date production is now at 362,857 oz, at an AISC of A$1,040 per ounce.
Those numbers helped to lift Evolution's mine operating cash flow to A$233.1 million with net mine cash flow of A$144.0 million.
The Evolution Mining share price will be worth watching as investors take in this morning's numbers.
One factor that could put the group's shares under pressure was a lower achieved gold spot price. Evolution's achieved price of A$2,091 per ounce represents a steep discount on the current A$2,267 per ounce spot price.
Positively, Evolution ended the December 2019 quarter debt free and with A$170.3 million cash in the bank. That's a significant increase in cash from the A$91.7 million recorded at the end of September 2019.
What about the group's operational update?
In terms of its operations, Evolution's Mt Carlton operations has identified orebodies narrowing at shallower levels than previously modelled.
The Evolution Mining share price could come under pressure if investors react to the Aussie miner's warning of unanticipated loss of ore tonnes in areas planned to be mined in FY20.
Evolution downgraded its estimated production range for Mt Carlton from its original 95,000 to 105,000 oz range to just 70,000 to 75,000 oz. The group's AISC will jump from A$800 to $A850 per ounce to A$1,150 to A$1,225 per ounce.
The Aussie miner also flagged the ongoing drought conditions as a potential headwinds. Water security remains a vital issue for Evolution and its Cowal operations in New South Wales and several initiatives are underway to improve access to water at the site.
The Evolution Mining share price is worth watching in today's trade after the guidance downgrade and operational updates.
