The Alkane Resources Limited (ASX: ALK) share price is gaining in morning trade, up by 2.49% to $1.24.
Below we take a look at the ASX resource producer's gold production update.
What production update did Alkane announce?
Alkane Resources' share price is moving higher after the company provided a positive update. Alkane said it had exceeded its 2021 financial year gold production guidance at its Tomingley Gold Operations, in New South Wales.
The company's original full-year guidance had been for production in the range of 45,000–50,000 ounces of gold. In April, Alkane upgraded that guidance to a higher range of 50,000–55,000 ounces.
In this morning's announcement, Alkane reported Tomingley had produced 56,958 ounces of gold in FY21.
Additionally, the company reported costs had come in below its guidance of $1,400–1,550 per ounce. Pleasingly, all in sustaining costs (AISC) for the financial year came in at $1,320 per ounce.
Alkane credited a higher grade of material processed than it originally forecast for helping drive its guidance-beating results.
Commenting on the results, Alkane's managing director Nic Earner said:
Tomingley continues to meet or exceed our expectations, demonstrating why it is a great asset managed by a highly professional and committed operations team.
With an updated mine plan that extends the life of Tomingley to at least 2031, at increased production rates, we remain buoyant about the longer-term prospects both at Tomingley and at our Boda exploration tenements.
As at 30 June, Alkane Resources had (unaudited) $19.0 million in cash, $7.7 million of bullion in hand and $47.2 million of listed investments. It also has $20 million in undrawn credit approved facilities.
The company's gold production guidance for the 2022 financial year from Tomingley is 55,000–60,000 ounces at an AISC of $1,450–1,600 per ounce.
Alkane Resources share price snapshot
Over the past 12 months the Alkane Resources shares are down more than 3%. In comparison, the All Ordinaries Index (ASX: XAO) has gained 27% over that same time.
Things have turned around for shareholders in 2021, with the Alkane Resources' share price up 28% year-to-date.
