The Independence Group NL (ASX: IGO) share price has come under pressure on Wednesday following the release of its full year update.
In early afternoon trade the gold and nickel miner's shares are down 3.5% to $5.43.
What happened in FY 2019 for Independence Group?
Investors have been hitting the sell button today after Independence Group reported a mixed finish to the year.
Although it achieved better than expected production at its Nova operation and production in line with guidance at the Tropicana operation, its costs were a little on the high side.
At Nova the company produced 7,906 tonnes of nickel and 3,462 tonnes of copper at cash cost of $2.07 per pound. This took its full year production to 30,708 tonnes and 13,693 tonnes, respectively, at an average cash cost of $2.07 per pound.
For FY 2019 the company had been targeting a cash cost in the range of $1.65 to $2.00 per pound at Nova. Management blamed the high cash costs on lower realised by-product credit pricing.
At Tropicana the company achieved gold production, cash costs, and All-In Sustaining Costs (AISC) within guidance for both the quarter and FY 2019.
This ultimately led to the company reporting full year revenue of $792.9 million and underlying EBITDA of $340.7 million, which was an underwhelming increase of 1.5% and 0.5%, respectively, year on year.
And looking ahead, it appears unlikely that the company will be bettering this result in FY 2020 based on the guidance it has provided.
Management has retained the same production guidance as it had for FY 2019, but increased its costs guidance materially. In FY 2019 it was targeting cash costs of between $1.65 and $2.00 per pound, whereas next year it expects costs in the range of $2.00 to $2.50 per pound.
Elsewhere in the industry on Wednesday, the shares of Evolution Mining Ltd (ASX: EVN) and St Barbara Ltd (ASX: SBM) have pushed higher following another rise in the gold price overnight.
