The St Barbara Ltd (ASX: SBM) share price is in negative territory today.
At the time of writing, the gold miner's shares are trading for $1.49, down 1.97%.
What happened?
The St Barbara share price is being weighed down today as investors react to the company's latest projections.
According to its release, St Barbara provided a FY22 guidance for its Simberi Operations in New Ireland Province, Papua New Guinea (PNG).
Simberi is forecasted to produce between 25-30koz at an all-in sustaining cost (ASIC) of $3,200-$3,600 per ounce in FY22.
As such, the group's FY22 production guidance is expected to come to 275-290koz and AISC of $1,750-1,870 per ounce. The guidance for its operations at Leonora and Atlantic remains unchanged.
Last month, St Barbara withdrew its guidance at Simberi following a severe outbreak of COVID-19 across the Tabar Island group. This affected operations as personnel were forced into isolation.
At the peak, 270 people of the 600 strong workforce were at home recovering.
With limited operators and maintainers available, this impacted the amount of material mined and hauled. As a result, production for the third quarter is now expected to be roughly 11koz.
While the number of cases has fallen to 12 employees in isolation, the situation is deemed to be under control.
Nonetheless, the company has determined that ramp-up rates will be slower than previously anticipated. Securing expatriate maintenance specialists and operations management continues to be challenging.
This is expected to impact Q4 FY22, however the new guidance range reflects the latest assessment.
Quick take on Simberi operations
Acquired in 2012, Simberi operations is an open cut mining operation, situated on the northernmost island in the Tabar group of islands of PNG. The company has a 100% indirect interest in the Simberi Gold Project, through its wholly-owned subsidiary, Simberi Gold Company Ltd.
Recently the company announced its pre-feasibility study which highlighted that the project has potentially strong financial returns.
In addition, the mine life is expected to run for about 11 years.
About the St Barbara share price
Over the past 12 months, St Barbara shares have plummeted around 26%. Year to date, the shares are in the green, up 2%.
The company's share price reached a 52-week low of $1.208 in January 2022 and has moved in circles since.
St Barbara has a price-to-earnings (P/E) ratio of 8.29 and commands a market capitalisation of roughly $1.06 billion.
