African Gold Producer's Cash Balance Exceeds A$1B, Growth Projects Advance

• Perseus Mining had a strong quarter and year, achieving top-end production guidance while keeping costs low
• CEO Jeff Quartermaine credits success to operational efficiencies and focus on maximising production at lowest costs
• Perseus operates three mines in West Africa, with A$1B cash on hand and new growth projects in the pipeline
• Quartermaine emphasises importance of fair benefit sharing with host countries and communities
• Perseus is advancing new projects while extending mine life at existing operations to drive long-term sustainable growth

Australian gold miner Perseus Mining announced exceptional quarterly and full-year 2024 results, positioning the company for continued success. Perseus is a disciplined operator with a robust West African production base, strong finances, and an attractive growth pipeline.

Record Production at Industry-Leading Costs 

Perseus achieved gold production of 132,419 ounces in the latest quarter at an all-in site cost (AISC) of just US$1,127 per ounce. This impressive result places Perseus among the gold industry's lowest cost producers globally. CEO Jeff Quartermaine attributes the strong performance to Perseus' relentless focus on operational excellence:

"It's production of ounces at the lowest possible costs and that is all we focus on basically ... the gold price is somewhat irrelevant to us and you can see the benefit of taking that approach because our cost structure at a touch over US$1,100 an ounce is not terribly dissimilar to what we were producing at maybe 10 years ago."

By keeping costs in check even as industry input costs rise, Perseus has been able to maintain robust margins of around $1,300 per ounce at current gold prices. This cost discipline enabled Perseus to generate operating cash flow of US$173 million for the quarter.

Strong Balance Sheet Provides Flexibility 

Perseus ended 2024 with approximately A$1 billion (US$ 704 million) in cash and bullion, a war chest that affords the company significant flexibility. Quartermaine detailed a multi-pronged capital allocation approach including funding organic growth projects, paying shareholder dividends, opportunistic share buybacks, and evaluating potential acquisitions.

He emphasised that Perseus remains disciplined and patient in evaluating M&A opportunities in a competitive market. The company seeks long-life, large-scale assets to build a sustainable production base for the future, but will only transact when an attractive opportunity arises at the right valuation.

Interview with President & CEO, Jeff Quartermaine

Advancing Organic Growth Projects 

Perseus is moving forward on multiple fronts to extend mine lives at its existing operations while advancing new projects. At the Edikan mine in Ghana, Perseus announced approval of an underground development off the CMA open pit project. An underground mining contractor has been appointed and will mobilise to site in April 2025 to commence portal development.

Meanwhile in Tanzania, Perseus is poised to make a final investment decision on its recently acquired Nyanzaga project. Government negotiations are progressing well as Perseus seeks clarity on fiscal terms before proceeding. CEO Quartermaine noted:

"Once approved, we'll get straight into full scale development and will be producing gold in early 2027."

Based on current timelines, Perseus expects to meet its original target of first gold in January 2027, though this could be delayed if government talks extend.

Perseus is actively working to replace depleted reserves and extend mine life across its portfolio. At Edikan, Sissingué and Yaouré, near-mine exploration is evaluating opportunities to expand open pits using higher gold price assumptions. While this approach would increase unit costs, Quartermaine highlighted the need to balance growth against cost escalation and margin preservation. He explained:

"That's something that we've got to weigh up...do we want to move Perseus from being an $1100 per ounce producer to a higher cost producer...do you want to tolerate a higher cost...that's all well and good while the gold price is high but is the gold price going to be high forever?"

Social License & Shared Benefits 

A key part of Perseus' approach is its commitment to host countries and communities. CEO Quartermaine stressed the importance of equitable benefit sharing as a core principle:

"The world today is very very different to what it was 10 or 15 or 50 years ago, and coming into the countries where we operate, people very reasonably expect to get their fair share of the benefit of their resources. Because that's what they are after all - they are their resources, their national heritage."

He argued that maintaining a social license to operate through responsible ESG practices is vital to long-term success and that Perseus will continue to prioritise community engagement regardless of shifting market sentiments. In his view,

"You can have the best assets in the world and the most money in the world and the greatest people, but if you're not welcome in a host community or a government you don't actually have anything."

For Investors

Perseus Mining presents a compelling investment case as a disciplined gold producer with industry-leading costs, robust financials, and clear growth prospects. The company's conservative approach to capital allocation, demonstrated by its $1 billion cash position and measured expansion strategy, provides a strong foundation for sustainable growth.

While the supportive macro environment for gold adds tailwinds, Perseus' true strength lies in its operational excellence and commitment to stakeholder relationships in West Africa. With production costs remarkably stable at around US$1,100 per ounce, the company is well-positioned to generate strong margins even in volatile gold markets.

For investors seeking exposure to gold through a well-managed producer with proven assets and a clear growth trajectory, Perseus Mining remains an attractive opportunity backed by solid fundamentals and responsible management practices.

The Investment Thesis for Perseus Mining

• Exceptionally low All-In Sustaining Costs (AISC) of just over $1,100 per oz position Perseus as one of the world's lowest-cost gold producers
• Strong operating cash flows and ~$1 billion AUD net cash provide flexibility to fund growth, pay dividends, buy back shares, and pursue accretive M&A
• Near-term organic growth potential from underground mine development at Edikan in Ghana and the Nyanzaga project in Tanzania
• Actively working to extend mine lives at Edikan, Sissingué and Yaouré through near-mine exploration leveraging higher gold prices
• Experienced management team with track record of operating successfully in West Africa
• Committed to host countries and communities through fair benefit sharing and responsible ESG practices
• Patient and disciplined approach to capital allocation and growth - willing to wait for the right opportunities at the right valuation

Macro Thematic Analysis

The global macroeconomic environment remains supportive of the gold investment thesis. Heightened geopolitical tensions, soaring inflation, and the specter of a global economic slowdown have increased safe haven demand for gold as a portfolio diversifier and hedge.

Central banks have aggressively hiked interest rates to tame inflation, but the impact on gold has been muted, with the yellow metal displaying its resilience. Many analysts believe we have reached peak hawkishness, and that a reversal in monetary policy is on the horizon as economic growth falters.

This could provide a bullish backdrop for gold prices in 2025 and beyond. As confidence in fiat currencies erodes amid huge money supply expansion and fiscal largesse, gold stands out as a proven store of value. The risk of a policy mistake tipping economies into recession or even stagflation will likely continue to drive haven flows.