Serabi Gold (SRB) Q3 2024 earnings summary

Executive summary

• Stable gold production maintained for 20 years, primarily from Palito Mine, with Coringa Mine now transitioning from development to production, driving growth over the next two years.

• Revenue for the nine months ended 30 September 2024 was $70.29 million, up from $47.90 million year-over-year, driven by higher gold sales volumes and prices.

• Production expected to increase from 38,000 ounces in 2024 to 60,000 ounces by 2026, funded entirely from internal cash flow without shareholder dilution.

• Ore sorting technology at Coringa and Palito has significantly improved grade and reduced processing costs, eliminating the need for a new process plant at Coringa.

• Strong commitment to ESG, with dry stacking of tailings, minimal environmental footprint, and transition to hydro power at Palito.

Financial highlights

• Cash balance reached $20.03 million by end of Q3 2024, with further growth expected by year-end.

• All-in sustaining costs (AISC) currently in the $1,700s/oz, projected to fall to $1,400–$1,500/oz as production scales up.

• Gross profit rose to $27.15 million from $10.08 million year-over-year, reflecting improved operational performance and higher gold prices.

• Net profit for the nine months was $17.84 million, up from $4.62 million in the prior year period.

• No significant capital outflows expected in 2025 beyond mine development at Coringa and a $5 million+ brownfield exploration budget.

Outlook and guidance

• FY 2024 production guidance of 38,000 ounces expected to be met, with Q4 anticipated as the strongest quarter.

• FY 2025 production guidance to be released in early January, targeting above 45,000 ounces.

• Coringa production to ramp from 20,000 ounces in 2024 to nearly 40,000 ounces by 2026.

• Management expects to continue gold production growth at Palito Complex and further ramp up at Coringa, targeting higher output than 2023.

• Exploration focus on doubling Coringa’s resource to 1 million ounces and expanding Palito’s resource base.