Blackham Resources Limited (ASX:BLK) surged after a record month for its Matilda-Wiluna gold operation - one in which output increased and costs were significantly reduced, resulting in strong cash flows.
The company is a leading ASX gainer with shares up 40% in early afternoon trade to 7.5 cents on strong volume of more than 248 million.
Output from the Western Australia mine was 6,713 ounces of the yellow metal, up from 6,498 ounces as 150,000 tonnes of ore was milled.
Costs down significantly
All in sustaining costs fell 21% to $912 an ounce, while the average realised price was $1,670, making for a healthy profit margin from production.
As at the end of last month, Blackham was sitting on cash and bullion of $31.4 million, while it had secured debt of $43.8 million.
“We remain confident that 2018 will be a transformational year that will generate significant cash flows and value for Blackham and its shareholders,” said the company’s chairman Milan Jerkovic.
Despite significant rainfall and lightning during the month, which restricted mining operations, high-grade stockpiles have increased to 144,000 tonnes at 1.7 grams of gold per tonne.
Headed in the right direction
Chairman Jerkovic added: “February’s operational results demonstrate a continued improvement of the turnaround that commenced in December 2017.
“Record production and further reduced costs from the operation underpinned another month of strong cashflow, whilst maintaining stockpiles with increased grades.”