ASX:RSG
Resolute Mining Ltd
Investment Summary
The fund managers believe that Resolute Mining Ltd is well-positioned to capitalize on rising gold prices, with a strong operational outlook after a good first quarter that keeps them on track for full-year production guidance. In their opinion, the company’s net cash position and unhedged gold production allow it to benefit fully from increases in gold prices, which recently reached an all-time high of USD 2,450 per ounce. As Resolute's cash flow is expected to rise substantially, the fund managers noted a 25% increase in share price in July, partly driven by a 5% increase in gold prices and continued operational performance, including a 19% increase in gold production to 91 koz in the second quarter. They suggest that Resolute’s share price is currently playing 'catch up' to the gold price increases observed over the past year, indicating strong potential for further appreciation.
Commentary From The Managers
Cadence Capital
31 July 2024
$0.65
- Resolute Mining’s share price increased by 25% during the month.
- This rise was attributed to a 5% increase in the gold price.
- Operational performance was strong, with 91 koz of gold produced in Q2, a 19% increase from the previous quarter.
- Cadence Capital has noted that gold company share prices have not kept pace with gold price increases.
- We attribute part of Resolute Mining’s performance to the share price playing ‘catch up’ with gold price increases seen over the past year.
Cadence Capital
31 May 2024
$0.56
- Resolute Mining has confirmed it is on track to meet its full year gold production guidance after a strong first quarter.
- The company is currently in a net cash position, enhancing its financial stability.
- Gold production from Resolute is now unhedged, allowing them to capitalize fully on any rises in gold prices.
- Gold prices have recently reached an all-time high of USD 2,450 per ounce, which is advantageous for Resolute's profitability.
- Cadence Capital continues to hold due to the expected significant rise in cashflow aligned with current gold prices and anticipated production levels.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.