Evolution Mining hits over four-year high after profit beats estimates

Shares of Australia’s Evolution Mining jumped to a more than four-year high on Wednesday after the gold miner’s half-year profit topped market estimates.

The stock rose as much as 2.4% to A$6.370, hitting its highest level since November 9, 2020. The benchmark ASX200 ended 0.6% higher.

Evolution, majority-owned by AustralianSuper – the country’s largest pension fund – said its net profit more than doubled year-on-year to A$385 million ($242.3 million) for the half-year ended December 31.

Analysts at Citi said the miner’s profit was 11% ahead of their expectations and 20% above Visible Alpha consensus estimates.

“We have seen the benefits of the foundations laid during FY24…with record breaking financial results and significant cash flow generation achieved in the first half,” said Lawrie Conway, Evolution’s CEO.

Morningstar analysts said higher gold and copper prices and increasing sales volumes by Evolution outweighed a modest rise in costs.

Further, the Sydney-headquartered firm’s earnings before interest, tax, depreciation & amortization (EBITDA) doubled to A$985.3 million for the period from a year earlier, beating Jefferies’ estimates of A$917 million.

Evolution, which operates six gold mines across Australia and Canada, said it is on track to deliver its fiscal year 2025 production forecast of 710,000-780,000 ounces of gold and 70,000-80,000 tonnes of copper.

“We continue to forecast gold sales volumes rising to around 840,000 ounces in fiscal 2029, driven by increased production at Red Lake and Mungari,” Morningstar analysts said in a note.

($1 = 1.5888 Australian dollars)

(By Rajasik Mukherjee; Editing by Sonia Cheema)