May 21, 2022

Silver Lake Resources (ASX:SLR) Withdraws FY22 COVID Disruption Guidance – The Market Herald


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  • Silver Lake Resources (SLR) Withdraws FY22 Gold Sales Forecast Due to “Serious Disruption” Caused by COVID-19
  • The billion-dollar materials stock has been experiencing supply chain issues and labor shortages, leading it to withdraw its guidelines as it was on track for respect.
  • In total, Silver Lake produced over 53,800 ounces of gold from the WA-based Deflector and Mt Monger projects, as well as 262 tonnes of copper from Deflector.
  • Year-to-date production was 182,778 ounces of gold and 756 tonnes of copper with sales of 179,990 ounces of gold and 697 tonnes of copper
  • SLR shares are trading down 8% at $1.84

Silver Lake Resources (SLR) said operations during the March 2022 quarter were negatively impacted by COVID-19.

The billion-dollar stock has experienced a combination of supply chain issues, related definitions and processing protocols that have “negatively impacted” the availability of skilled workers, leading to disruptions to operations, higher costs and increased operational risks.

In terms of production, Silver Lake produced 53,822 ounces of gold from its Deflector and Mt Monger projects, down from 64,009 ounces produced in the December quarter.

Additionally, the recently added Sugar Zone mine (through the acquisition of Harte Gold) produced 9,992 ounces of gold and sold 12,758 ounces of gold (of which 4,926 ounces are attributable to Silver Lake).

The Deflector project also produced 262 tonnes of copper, marking an increase from 243 tonnes in the prior quarter.

Located in Western Australia, the Deflector Gold and Copper project contributed the bulk of gold production with 30,581 ounces produced.

The company sold 29,256 ounces and 246 tonnes of copper from the Deflector mine at an all-in sustaining cost (AISC) of $1,465 per ounce, which was higher than the prior quarter.

At the Mt Monger project, also in WA, 23,241 ounces of gold were produced with sales of 26,134 ounces. Similar to the Deflector project, AISCs were higher than the December quarter and totaled $2,270 per ounce.

Year-to-date production was 182,778 ounces of gold and 756 tonnes of copper (186,326 ounces of gold equivalent) with sales of 179,990 ounces of gold and 697 tonnes of copper at an average selling price of $2,441 per ounce and an AISC of $1,673 per ounce.

While the company said year-to-date performance positions it to meet its group gold sales guidance for FY22, COVID-19-related labor shortages, Ongoing restrictions and supply chain constraints caused it to withdraw its sales guidance for FY22. Silver Lake said it could not confidently predict operational performance in the June quarter.

Cash and bullion as of March 31 totaled $287.3 million, which is higher than the $273.8 million he started with.

SLR shares fell 8% to trade at $1.84 at 1:33 p.m. AEST.