PERTH (miningweekly.com) – Gold miner Northern Star Resources has reported record cash earnings of A$648-million for the 2021 financial year, following its merger with fellow-listed Saracen Mineral Holdings.

Northern Star sold 1.59-million ounces of gold during the year in review, at an average price of A$2 277/oz and an all-in sustaining cost (AISC) of A$1 483/oz, resulting in revenues reaching A$2.7-billion, up from the $1.9-billion reported in the previous financial year.

Underlying earnings before interest, taxes, depreciation and amortisation increased by 216%, from $717-million to $2.2-billion as cash earnings increased by 10%, from A$588-million to A$648-million.

Net profit after tax reached A$1.03-billion, up from the A$258-million reported in the 2020 financial year.

Northern Star recognised an asset impairment of A$546-million during the 2021 financial year, relating to the sub-grade stockpiles at the Kalgoorlie Consolidated Gold Mines, and a review of the carrying value of exploration assets.

Northern Star MD Stuart Tonkin said the results provided valuable insight into the scale, profitability and growth potential of the enlarged company.

“With the completion of the merger, we have established a simple, effective strategy based on our three production centres in world class locations,” Tonkin said.

“We have a clear five-year pathway to annual production of two-million ounces a year with a strong emphasis on ensuring it is profitable growth. This strategy involves investing capital in those projects which will generate the strongest returns and actively managing our asset portfolio to maximise this outcome.

“We have an enviable asset base and world-class inventory with significant scope for further organic growth. And as these result show, we have the balance sheet and cash strength to unlock the full value of these opportunities in a way which will drive strong financial returns.”

Looking at the 2022 financial year, Northern Star has set a production target of between 1.55-million and 1.65-million ounces, at AISC of between A$1 475/oz and A$1 575/oz, with net growth capital of A$570-million. A further A$140-million will also be spent on exploration.