Regis flags $280m hit on review
One-time market darling Regis Resources is facing a $280 million hit as the gold miner conducts a review of its assets in the Northern Goldfields and NSW.
The Nick Giorgetta-chaired company says a pre-tax impairment charge in the range of $230 to $280 million is likely to be announced at its financial results in September.
Regis says the charge is consistent with its previous 2015 full year guidance issued in May.
The impairment charge relates to open pit pre-strip mining, deferred waste mining and pre-production costs at its Garden Well and Rosemont assets near Laverton amid falls in the gold price.
"Whilst no final decision has been made, the board believes it is likely that an impairment charge in the range of $230 to $280 million will result," Regis said in a statement.
Yesterday Regis also reported quarterly gold production to June 30 of 65,747 ounces at a cash cost of $1010 per ounce.
Total gold production for the financial year was 270,759oz.
"Production and costs were significantly compromised by restricted operations resulting from impacts and remediation of flooded Garden Well and Rosemont pits," Regis said.
Mining operations during the June quarter were restricted to the southern stage four part of the Garden Well open pit following flooding.
Cash costs of operation for the quarter were $1299 per ounce due to disruptions of flood remediation, restricted mining areas and processing plant restrictions, the company said.
On the bright side, Regis has completed expansion of its Garden Well processing plant on time and under the $20 million budget to boost recoveries for its nearby Rosemont mine.
Commissioning is underway and should be completed in the September quarter.
Perth-based Regis made an unaudited profit of $79 million for the financial year which does not include tax or the expected impairment charge.
The company also extended its financing facility with Macquarie Bank to $70 million.
Shares in Regis were 1.4 per cent lower at $1.78 at yesterday's close, down from a five-year high of $5.87.
