Cash and growthHas Robex's recent SP decline caused any negative emotions for you? Remain confident because Robex's financial situation, production capacity and growth potential have rarely been better.
The constant increase in the tonnage of ore processed during 2021 is definitely the most interesting statistic to observe. In 2021-Q4, this increase is 7.88% compared to 2021-Q3, 9.55% for 2021-Q2 and 10.02% for 2021-Q1. In addition, the recurrence of this increase was confirmed by the results obtained at the beginning of January 2022. Consequently, 519,749 tonnes of ore processed / quarter is now the value that will be used for my next estimates.
The sustainability of this production capacity will be ensured by the availability of the 4 zones cleared of their waste rock and by the bottom of the main pit which is fully available for the extraction of ore from the transition zone. All of this surface area to be mined is what will provide the agility needed to continuously feed the plant and control the gold grade to be processed. Consequently, the predictability of the production results obtained is an attribute that should appeal to the Chief Financial and Operations Officer.
Regarding the gold grade, the average is 0.88 g/t for 2021-Q4 and improves further in December to reach 0.94 g/t. Considering that 6.82% is a significant increase, the calculation of my pessimistic scenario for 2022 will use a gold grade of 0.88 g/t and 0.94 g/t for my optimistic scenario. The good gold grade in December is also an indicator that suggests that the stripping ratio has stabilized around 3, which will have very positive consequences on production costs.
For the year 2022, the pessimistic scenario considers the processing of 2,078,996 tonnes of ore with an average grade of 0.88 g/t. The adjustment of the 2021 results according to these assumptions makes it possible to anticipate a production of 53,945 ounces of gold (46,554 x 1.067 x 1.086) for the year 2022, an increase of 15.87%.
For the optimistic scenario, he proposes an average grade adjustment of 0.94 g/t. Under this assumption, the 2022 results will be 56,131 ounces of gold (46,554 x 1.067 x 1.13), an increase of 20.5%.
For the dreamers, I offer you a final annualized scenario entirely based on the results obtained in December 2021. This considers the processing of 2,304,288 tonnes of ore with an average grade of 0.94 g/t. The adjustment of the results according to these assumptions makes it possible to anticipate a production of 62,180 ounces of gold (46,554 x 1.182 x 1.13), an increase of 33.56%.
In any case, we can envisage a year 2022 with rising revenues, falling costs and all the free cash flows that will be necessary to ensure the development of operations through internal or external growth and/or restore the distribution of dividends. A good understanding of this financial context makes it possible to establish that the recent drop in the SP is attributable to other factors and that we are currently in the presence of an opportunity quite comparable to that of 2019.
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