Evolution Mining (ASX:EVN) share price gains on record profit

2021 was a bumper financial year for the mining company…

| More on:
A miner reacts to a positive company report mobile phone representing rising iron ore price

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Evolution Mining Ltd (ASX: EVN) share price is soaring after the company released its results for financial year 2021 (FY21).

Right now, the Evolution share price is $4.05, 2.53% higher than its previous close.

Evolution share price jumps on $345 million statutory NPAT

Here's how Evolution performed during FY21:

The period saw an increased achieved gold price of $2,369 per ounce. However, that was partially offset by a decrease in production for the year.

Evolution produced 680,788 ounces of gold in FY21, 8% less than it did in FY20.

Additionally, the company achieved all-in sustaining costs of $1,215 per ounce, which it says is sector-leading among global gold producers.

Of the company's approximate $1.86 billion of revenue, around $1.60 billion came from gold, $236.9 million from copper, and $22.1 million from silver.

The 5-cent final dividend brings Evolution shareholders' total FY21 dividends to 12 cents per share. That's 23.5% more than FY20's total dividends.

Evolution ended the period with $160.1 million of cash and $620 million worth of debt.

What happened in FY21 for Evolution Mining?

It's been a big financial year for Evolution Mining and its share price.

The company acquired Canadian gold producer Battle North Gold Corp in May. Evolution also acquired the Crush Creek Project, located near its Mt Carlton operation in Queensland.

The company committed to transition to net-zero scope 1 and 2 greenhouse gas emissions by 2050, and to reduce its greenhouse gas emissions by 30% by 2030.

Evolution also released its maiden mineral resource estimate for its Red Lake Project during FY21.

Finally, it successfully completed a number of drilling programs at Mt Carlton.

COVID-19 had no material impact on Evolution's operations.

What did management say?

Evolution's executive chair Jake Klein commented on the results driving the company's share price today. He said:

I am proud of Evolution's achievements during FY21 amid the challenging backdrop of the COVID-19 pandemic. Our teams have risen to the challenge to deliver a record net profit and maintain our sector leading margins.

The fully franked final dividend of 5 cents per share is our 17th consecutive dividend, with $943 million in dividends paid to shareholders since our maiden dividend in 2013.

We continued to upgrade the quality of the portfolio with our commitment to develop the Cowal Underground mine, and district consolidations completed at both Red Lake and Mungari to further enhance those cornerstone operations.

What's next for Evolution Mining?

Here's what may drive the Evolution share price during the current financial year:

Evolution estimates its production for FY22 will increase to between 700,000 and 760,000 ounces.

It also expects its production will be between 815,000 and 875,000 ounces in FY23, and between 940,000 and 1,010,000 ounces in FY24.

The company plans to invest between $125 million and $155 million into sustaining capital in FY22. The majority of the capital will be directed to Cowal and Red Lake and be put towards equipment and infrastructure.

Major capital in FY22 is anticipated to be in the range of $440 million to $510 million, with more than half associated with expanding, developing, and exploring Cowal.

Additionally, Evolution plans to invest major capital into Red Lake, developing mining areas in its Upper Campbell and McFinley deposits.

Finally, major capital for the Campbell mill and Bateman mill will up their processing capacity by more than 2 million tonnes per annum, and put them on the path to surpassing 350,000 ounces of production in FY26.

Evolution share price snapshot

It's been a tough slog for the Evolution share price.

Right now, it's 23% less than it was at the start of 2021. It has also fallen 33% since this time last year.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Earnings Results

A man sits thoughtfully on the couch with a laptop on his lap.
Technology Shares

Up 74% in 2024, why is this ASX 200 stock rallying today?

Recurring revenues continue to grow.

Read more »

Man pointing at a blue rising share price graph.
Earnings Results

Guess which ASX All Ords share is soaring on 21% FY 2024 growth

Investors are piling into the ASX All Ords share today. Let’s find out why.

Read more »

Girl sliding down on snow with arms spread out.
Earnings Results

Elders shares on ice for a $475 million acquisition after profits plunge 55%

What on earth is going on with Elders shares today?

Read more »

A man has a surprised and relieved expression on his face. as he raises his hands up to his face in response to the high fluctuations in the Galileo share price today
Energy Shares

This ASX 200 mining stock just reported a 40% earnings jump

Investors appear pleased with this miner's performance during the first quarter.

Read more »

Business people discussing project on digital tablet.
Earnings Results

2 ASX All Ords shares surging over 10% on strong results

Investors are buying these shares in response to strong results this morning.

Read more »

A young woman holds her hand to her mouth in surprise as she reads something on her laptop.
Earnings Results

Xero share price rockets to record high on explosive half-year growth

The tech star delivered another impressive half year results this morning.

Read more »

A man cheers after winning computer game while woman sitting next to him looks upset.
Earnings Results

2 high-flying ASX 200 gaming shares splitting ways today

Which gaming giant is winning the admiration of investors amid results?

Read more »

Male building supervisor wearing high vis vest and hard hat stands and smiles with his arms crossed at a building site
Industrials Shares

This $23 billion ASX 200 stock is surging 6% while the market sinks. Here's why

This ASX 200 stock is shrugging off the wider market sell down today and racing higher. But why?

Read more »