St Barbara (ASX:SBM) share price slides 5% after quarterly results

An early dive for the ASX gold miner on its latest results.

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The St Barbara Ltd (ASX: SBM) share price has dipped into the red in early trading. This comes as the company released its quarterly results earlier this morning.

Let's comb over St Barbara's results in a bit finer detail.

Red arrow on gold bars going down.

Image source: Getty Images

A quick recap on St Barbara

St Barbara is a gold mining company that has interests at Leonora, Simberi and Atlantic sites. It has a geographical footprint in both Australia and Papua New Guinea.

It derives the bulk of its revenue from the Leonora site through the Gwalia underground mine.

St Barbara has a market capitalisation of $1.25 billion at the time of writing.

St Barbara's quarterly results

Fourth-quarter gold production came in at 82,698 ounces, a 24% decrease from the year prior.

All-in sustaining costs (AISC) of $1,623 per ounce came in 2% lower than the previous quarter and also more than $300 lower than the same time last year.

The company also recorded full-year gold production of 327,662 ounces on an AISC of $1,616/ounce.

St Barbara also outlined it had seen "significant improvements in operating performance" this quarter, with "record mill throughput rates" at the Atlantic site.

In addition, the Gwalia mine produced its "highest quarter of mill throughput in five years", despite headwinds incurred from a change in mining contractor.

Moreover, the Simberi site was granted conditional approval to recommence mining. Operations were halted at the site after the death of a worker last month and issues were found with a waste disposal pipeline. Processing at Simberi should recommence at the end of FY22, according to the company.

Additional takeouts

Back in June, St Barbara announced its "Leonara Province Plan", adding "~1.4 million ounces to the existing 5 million ounces of gold in Mineral Resources".

In early July, the company also acquired a 19.8% stake in Kin Mining NL (ASX: KIN).

Kin has 1.2 million ounces of "gold resources" near Leonara and has "exploration upside potential".

St Barbara also provided some colour on FY22 guidance in the report.

It sees FY22 consolidated gold production between 305,000 – 355,000 ounces of gold on an AISC of $1,710 – $1,860/ounce.

Guidance includes the "latest mine plan" at Atlantic, which estimates "lower than expected" ore grades.

Forecasts are "marginally weighted to H2 FY22" as processing at Simberi is aimed for a restart in December during that time.

St Barbara CEO Craig Jetson stated in the report:

All our operations rose to the challenge posed by the second year of the global COVID-19 pandemic and a difficult operating environment with rolling border closures causing additional challenges.

Consequently, investors seem unsatisfied with the company's results today, as shares exhibited high selling pressure from the open.

At the time of writing, St Barbara shares have recovered from their early dive, down 0.28% on yesterday's closing price, currently trading at $1.77 a share.

St Barbara share price snapshot

The St Barbara share price has posted a year to date loss of 25%, extending the previous 12 months' loss of 53%.

Both of these returns have lagged the S&P/ASX 200 Index (ASX: XJO)'s return of ~23% over the past year.

The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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