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Northern Star Generates Record Cash Flows for March Quarter

Northern Star Generates Record Cash Flows for March Quarter
Northern Star is on track to boost its production to 700,000 ounces per annum by 2018.
Apr 14, 2016 By Kaivalya Kandarpa Tags: NST

Local gold miner Northern Star Resources Limited (ASX:NST) released a positive quarterly trading update as it generated record cash flows and succeeded in reducing its all-in sustaining costs by a further 5%.

Northern Star expanded its sales by 1% to 143,469 ounces of gold during the three months’ period ended 31st of March 2016. The miner states that the sales made during the quarter have placed the company at the top end of its full year guidance of 535,000-570,000 ounces.

All-in sustaining costs have been reduced to $985 per ounce, a 5% drop from the December quarter. Lower contracting, labour and supply rates have enabled the miner to further decrease its production costs.

Northern Star Generated Record Cash Flows

Northern Star generated record operating cash flows of A$103 million during the March quarter. Free cash flow of A$66 million was achieved after accounting for all expenses including the $18 million spent in exploration and expansionary capital expenditure. Subsequently, the company finished the quarter with A$286 million in cash and bullion. As of today, Northern Star has no debt.

Northern Star Reaffirms Production Guidance

Northern Star has also announced that it is on track to boost its production to 700,000 ounces per annum by 2018.

During the March quarter, Northern Star announced high-grade drilling results from the Groundrush deposit at the Central Tanami Project. The company also announced that the exploration results at the Kanowna Belle project came in favourable and supported production growth by approximately 50%.

Recently, the company also revealed that three of the key deposits at its East Kundana Join Venture have shown a potential for improvement on its 100,000-110,000 ounces per annum production forecast. 

Northern Star’s Managing Director, Bill Beament was pleased with the results: “These results demonstrate that we are achieving outstanding operational outcomes which are translating into strong financial results for Shareholders. At the same time, we are setting up the company for tomorrow’s growth with an exploration and development strategy that is poised to deliver a significant production increase solely from organic sources.”

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Kaivalya Kandarpa Author: Kaivalya Kandarpa Apr 14, 2016

Kaivalya is an equity analyst and a client advisor at Wise-owl. She specialises in fundamental and technical analysis for large and mid-cap companies. Having completed her bachelor's degree in Business Administration majoring in Finance, Kaivalya has a comprehensive understanding of international stock market movements. She tracks local and overseas markets and compiles analytical reports for various industries.

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