Perseus Mining share price slips despite record quarter

Investors aren’t biting today despite the gold exploration company’s strong result.

| More on:
an unhappy miner poses with gloved hand on face wearing a hard hat with a light and frowning.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • Shares in Perseus Mining have slipped despite a strong quarterly result posted today
  • It was a record quarter for the company in terms of production and operating cash flows
  • In the last 12 months, the Perseus share price has gained more than 47%

The Perseus Mining Ltd (ASX: PRU) share price is tracking lower today despite the company posting a record result for the past three months of activity.

In its March quarter report released today, the gold exploration company said that it “continues to set production and operating cashflow records”. Despite this, investors have sold off and/or booked profits in Perseus shares today.

At the time of writing, the Perseus share price is tracing 2.85% lower at $1.875 after earlier hitting an intraday low of $1.84.

The share price is also likely to be feeling the weight of the S&P/ASX 300 Metals & Mining Index (ASX: XMM) tracking 5.51% lower so far today. That extends the sector’s losses to 11% over the past week.

Let’s take a closer look at the company’s March quarter results.

TradingView Chart

Perseus share price dips despite record quarter

Despite a production record of 130,523 ounces, investors haven’t bitten at Perseus shares today.

The company reported quarterly gold sales jumped to 131,044 ounces, an increase of 557 ounces for the quarter. Perseus realised these sales at a weighted average sales price of US$1,701 per ounce.

It also reported its weighted average all-in sustaining costs (AISCs) decreased by 3% quarter-on-quarter to US$908 per ounce.

The average quarterly cash margin increased US$58 per ounce to US$793 per ounce of gold for the quarter. However, cash expenditures increased during the period.

“Notional cashflow from operations increased by 10% quarter-on-quarter to US$104 million, resulting in total year to date notional cashflow of US$275 million,” Perseus said.

The company also paid an interim dividend of 0.81 cents per share at the end of the quarter. That represents a 0.43% trailing yield at the current share price.

Through its proposed acquisition of Orca Gold Inc., the company intends to increase its ore reserves and boost its ore inventory. It said:

The proposed acquisition of Orca Gold Inc. through a Plan of Arrangement which, when complete, will result in the ownership of the undeveloped long-life Block 14 Gold Project in Sudan, and an indirect 31.4% interest in the Koné Gold Project, owned by TSX-V listed Montage Gold Corp, in northern Côte d’Ivoire, that is based on a large, potentially long-life undeveloped gold reserve.

What’s next for Perseus Mining?

Perseus left the quarter with available cash and bullion of US$278 million, an increase of US$66 million in its net cash position.

With respect to its half-year forecasts, Perseus made no changes to previously outlined guidance in its results today.

It also retained full-year projections of 471,164 to 506,164 ounces at an AISC of US$932 to $1,020 per ounce. The company said:

Perseus’s strong operating performance is forecast to continue with no change to the June 2022 Half Year production guidance of 230,000 to 265,000 ounces at an AISC of US$915 to US$1,085 per ounce.

In the last 12 months, the Perseus share price has gained more than 47% and is up 16% this year to date after a slight pullback.

Motley Fool contributor Zach Bristow has no position 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.

More on Gold

A woman gives two fist pumps with a big smile as she learns of her windfall, sitting at her desk.
Earnings Results

Newcrest share price lifts despite profit falling 25%

We take a look at the gold miner's results for financial year 2022.

Read more »

a man sits in unhappy contemplation staring at his computer on his desk in a home environment, propping his chin on his hand.
Resources Shares

The ASX 200 share Firetrail just bought after brutal sell-off

If a stock has lost one-third of its value over the last four months, would you be courageous enough to…

Read more »

a smiling woman sits at her computer at home with a coffee alongside her, as if pleased with her investments.
Gold

Why has the Northern Star share price climbed 20% in a month?

What's caused the gold miner's shares to shine lately.

Read more »

St Barbara share price Minder underground looks excited a he holds a nugget of gold he has discovered.
Materials Shares

Guess which ASX mining share just exploded 30% on a new gold discovery

We take a look at what this explorer discovered.

Read more »

rising gold share price represented by a green arrow on piles of gold block
Gold

Why is the Evolution share price up 13% in a month?

Evolution Mining shares have been continuing to tread higher in August.

Read more »

a woman holds her hands to her temples as she sits in front of a computer screen with a concerned look on her face.
Gold

Why is ASX 200 gold share St Barbara sliding 10% today?

St Barbara is currently the worst performer among ASX 200 shares today.

Read more »

A woman blowing gold glitter out of her hands with a joyous smile on her face.
Share Gainers

Guess which ASX mining share is rocketing 30% on a ‘significant new discovery’

Meeka Metals has set off in vertical fashion today.

Read more »

Gold nuggets with a share price chart.
Gold

Down 20% so far in 2022, is the Newcrest share price a bargain buy or a falling knife?

Newcrest may or may not be at a turning point.

Read more »