Reviewing Northern Stars (NST) recent result
Hi Team, You said you were going to dig in to NST's results and report back but I can't find your analysis anywhere! Thanks
The Latest Q&A
Answer
Hi Stephen,
NST has climbed higher since the company delivered their half-year result a week ago but the sentiment towards gold stocks is being largely dictated to by bond yields, the $US and of course the underlying gold price. In terms of the result, they delivered record cash earnings of $430m, increased the interim dividend by 5% to 10c and continued the track record of increasing this over time. They have three operation centres are all in growth phase on track for 2moz by FY26. In short, the strategy is on track and they gave no change to FY22 guidance
The other interesting thing to happen this week was that they made the decision to not go ahead with Windfall JV/earn-in which they were doing due diligence on. Back in December they had signed an agreement for a private placement of C$154 million in a convertible debenture whereby NST would earn the right to effectively buy into the project over time. It was a good project however NST announced this week that they were not going ahead with it, the CEO saying“Following extensive due diligence, Northern Star was unable to agree mutually acceptable terms with Osisko”
We continue to like NST as a gold exposure and hold it in our Flagship Growth Portfolio.
