Calidus Resources Limited Announces Urgent Sale and Recapitalisation Process
CALIDUS RESOURCES LIMITED (CAI) Share Update August 2024 Friday 2nd
Calidus Resources Initiates Urgent Sale and Recapitalisation Process
Calidus Resources Limited, an ASX-listed gold company, has announced an urgent sale and recapitalisation process for its assets, including the Warrawoona and Nullagine Gold Projects.
Instant Summary:
- Receivers and Managers seek urgent expressions of interest starting 5 August 2024.
- Assets include Warrawoona and Nullagine Gold Projects and other satellite deposits.
- Processing of 1.3MT of low-grade ROM stock commenced, expected to generate positive cash flows.
- Calidus held $19.2M in cash and $11.0M in bullion as of 30 June 2024.
- Generated $45.8M in revenue from gold sales during the quarter.
Sale and Recapitalisation Process
Starting on Monday, 5 August 2024, the Receivers and Managers of Calidus Resources Limited will be seeking urgent expressions of interest for the acquisition and/or recapitalisation of the company. This opportunity includes the acquisition of some or all of the project assets, notably the Warrawoona and Nullagine Gold Projects, along with several satellite deposits that hold significant upside potential.
Interested parties are encouraged to contact the Receivers and Managers to lodge their expressions of interest. This process aims to secure a viable future for Calidus Resources and its valuable assets.
Update on Operations
Following a successful trial of low-grade ore over a five-day period, which resulted in an average grade of approximately 0.43g/t and an average recovery of about 94.0% through the mill, the Receivers and Managers have commenced processing around 1.3 million tonnes of low-grade ROM stock. This processing is expected to be completed by the end of the calendar year and is anticipated to generate positive cash flows for the company.
Additionally, the Receivers and Managers are evaluating the decision to mine and process additional ore from the Blue Bar deposit, further enhancing the company's operational prospects.
Corporate and Financial Information
As of 30 June 2024, Calidus Resources held $19.2 million in cash and $11.0 million in bullion. The company reported $45.8 million in revenue from the sale of 14,594 ounces of gold during the quarter, with 5,000 ounces delivered into the hedgebook and the remaining gold sold on the spot market at an average price of $3,140 per ounce.
However, the company also reported unaudited trading liabilities and accruals of $49.6 million as of 30 June 2024, compared to $36.9 million as of 30 March 2024, indicating an increase in financial obligations.
The announcement of the urgent sale and recapitalisation process is likely to have a significant impact on Calidus Resources' stock price. Investors may react to the uncertainty surrounding the company's future and the potential for asset sales. The commencement of processing low-grade ROM stock and the evaluation of additional ore mining are positive operational updates that could mitigate some concerns. However, the increase in trading liabilities may weigh on investor sentiment.
Investor Reaction:
Analysts are expected to have mixed reactions to this announcement. While the urgent sale and recapitalisation process introduces uncertainty, the positive operational updates and the company's cash and bullion reserves provide some reassurance. Investors will likely be closely monitoring the expressions of interest and the outcomes of the sale process.
Conclusion:
Investors should keep a close eye on the developments of the sale and recapitalisation process and assess the potential long-term impacts on their portfolios. Calidus Resources' ability to secure a viable future through this process will be crucial in maintaining investor confidence. Stay informed on the latest updates to make well-informed investment decisions.