Bellevue (ASX:BGL) share price leaps on 25% resource growth

This comes after the quarterly results were released before market open.

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The Bellevue Gold Ltd (ASX: BLG) share price has walked through today’s session in the green, hitting an intraday high of 99.5 cents.

Today’s gain comes as the company released its quarterly results before the market open.

Let’s comb over Bellevue’s results in a bit finer detail.

A quick recap on Bellevue Gold

Bellevue Gold is in the gold exploration business. It primarily engages in the exploration and evaluation of precious metals in Australia.

Its flagship interest is the Bellevue Gold project, but it also has interests in the South Yandal gold project.

At the time of writing, Bellevue Gold has a market capitalisation of $815 million.

Bellevue’s quarterly results

The company outlined a raft of progress points achieved throughout the quarter in its report.

Bellevue saw global resources increase to 3 million ounces (Moz), a 25% increase from the “stage 1 feasibility study”.

Indicated resources also grew 34% from the study to 1.4Moz. This will “form the basis of the stage 2 feasibility study” alongside an “upgrade to the 690 thousand ounce maiden ore reserve from stage 1”.

Recall that the stage 1 feasibility study forecasted Bellevue will “generate $1.6 billion in [earnings before interest, tax, depreciation and amortisation] EBITDA” over the life of the mine.

Moreover, the stage 1 study estimated that the company will generate an “average free cash flow of $190 million a year, pre-tax” when assuming a $2,300/ounce realised gold price.

Back to the quarter, Bellevue also recognised a “non-binding debt” offer of up to $289 million that came from “12 leading domestic and offshore financial institutions”. It did not specify which institutions were included on the list in the report.

Additionally, its global resource has demonstrated a run-rate of “~70,000 ounces per month…since the discovery hole in November 2017”.

Additional takeouts from the report

The company established a “second underground diamond rig” this quarter.

Bellevue states this is garnering a “substantial reduction in cost” and permitting “further exploration into the Deacon corridor”.

Regarding progress this quarter, the company stated:

The robust nature of the Bellevue Lode Resource has also been highlighted with exceptional grade control results received from early grade control drilling. The Company continues to invest in drilling to support Resource growth, further Resource conversion and, importantly, grade control, well ahead of the mine schedule.

Investors seem to have favoured the announcement and have pushed the Bellevue Gold share price into the green since the start of trading.

Bellevue Gold shares are now exchanging hands at 98.75 cents apiece, a 3.7% gain from the market open.

Bellevue Gold share price snapshot

The Bellevue Gold share price has had a choppy year to date, posting a loss of 12% since January 1. This extends the previous 12 month’s loss of 8.4%.

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

Should you invest $1,000 in Bellevue right now?

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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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