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Worker at the Deflector Gold Copper Mine. Source: Silver Lake Resources
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  • Silver Lake Resources (SLR) trades red this morning following the release of its latest quarterly financial report for the three months to the end of September 2021
  • Silver Lake produced just under 65,000 ounces of gold and 251 tonnes of copper over the quarter, with gold sales topping 62,000 ounces at an average of $2467 per ounce
  • The result is a $28.4 million increase to cash and bullion to $359 million by the end of September — not including SLR’s gold concentrate on hand and listed investments
  • While the company affirmed its annual exploration budget of $25 million for the 2022 financial year, Silver Lake is yet to shed light on why it is holding on to so much cash
  • Shares in Silver Lake Resources are down 2.14 per cent and trading at $1.60

Gold miner Silver Lake Resources (SLR) is trading red this morning following the release of its latest quarterly financial report for the three months to the end of September 2021.

While total gold production and sales over the September quarter topped the June quarter from this year, Silver Lake is yet to tell investors what it plans to do with its growing stockpile of cash.

Silver Lake produced just under 65,000 ounces of gold and 251 tonnes of copper over the quarter. This production figure was underpinned by record production of 31,000 ounces of gold and 251 tonnes of copper from Silver Lake’s Deflector project.

The company sold 62,051 ounces of gold at an average of $2467 per ounce with an all-in sustaining cost (AISC) of $1562 per ounce over the September quarter.

Combined with quarterly copper sales, the result was a $28.4 million increase to cash and bullion to $359 million by the end of September — not including the $21.3 million of gold in circuit and concentrate on hand and SLR’s $10.5 million in listed investments.

The company has no debt.

Yet, Silver Lake is yet to shed light on why it is holding on to such a large amount of cash.

The company said it was continuing to advance its exploration work, with a 1.36-million-ounce increase to group ore reserves over the quarter. However, exploration investment topped $5.2 million over the three-month period — well below Silver Lake’s revenue from gold and copper sales.

As far as its business outlook goes, Silver Lake said it was well-positioned to hit its 2022 financial year sales guidance of between 235,000 and 275,000 ounces of gold and between 600 and 1000 tonnes of copper. The company forecasts an annual average AISC of between $1550 and $1650 per ounce of gold equivalent.

The company’s exploration investment budget is $25 million for the full 2022 financial year.

As such, despite the company’s quarterly production increase, investors reacted rather tepidly to the Silver Lake report, likely due to the lack of direction for the growing cash position.

Shares in Silver Lake Resources were down 2.14 per cent and trading at $1.60 at 1:04 pm AEDT. The company has a $1.44 billion market cap.

SLR by the numbers
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