Market Update

General - Lucapa - Resolute - Gascoyne

Good afternoon

German business confidence slipped slightly , but less than expected. 

Nickel and gold looking strong today - some support for gold ahead of talks between Trump and Juncker?

Lucapa Diamonds - production at Lulo is going quite well, and the local subsidiary has 10 Mill US$ in cash + a very reasonable diamond inventory. That will be needed - the holding company is planning to spend 9 Mill US$ this Quarter, mainly on developing the second mine, Mothae in Lesotho, which will deplete cash reserves at holding company level. The company is also talking to a South African financier on a project loan for Mothae. I think that might be needed - I assume, that Lucapa will need some additional cash, as the timing of payments from the jointly owned Lulo-subsidiary could be a bit uncertain. LOM are on my watch-list...but not quite yet on my buing list!

Gascoyne - commissioning of Dalgaranga is going well. The targeted mill throughput rate of 2.5 milltpa has been consistently achieved. Plant availability has been at 95%+, gold revovery so far in July of 94%+ is also as planned. During commissioning, 7400 oz have been produced so far, and have been delivered into the 180.000oz hedge at 1716 A$/oz . Cash balance of 25 mill$ at the end of June seems easily sufficient to me, as commercial production should be achieved around the 30th of September - and some cash should be generated before that time. Crushing and milling have at times substantially exceeded design, which augurs well. The only thing we do not know as yet are grades - not to be underestimated, obviously, but fair to say, that commissioning so far is going very well. The full Quarterly is not out as yet. This looks promising, provided the gold price does not dive much further!

Resolute - produced 75.000oz at 1303 A$ AISC for the Quarter, to manage a slight beat of the yearly production - and cost guidance. For the enw financial year, RSG expects to produce slightly more at slightly lower costs - 300.000 oz at 1280 A$/oz. Syama underground is progressing as planned, and should see production starting in December. Ravenswood also delivered just above budget. Cash is ok but not plentiful - there is no reason to believe, that Syama sub-level cave will not work, but there are certainly risks. As a holder, happy to hold - as a potential buyer, I would wait a little!

Have a nice evening!


Schröder Equities GmbH


80538 München

Tel. +49-89-4613440-0

Fax +49-89-4613440-10




eingetragen im HR München, HRB 166985

Geschäftsführer: Wilhelm Schröder


The information contained in this communication is confidential and is intended only for the use of the addressee. Unauthorised use, disclosure or copying is strictly prohibited. If you have received this communication in error, please delete it and notify us by telephone at +49-89-4613440-0, by fax at +49-89-4613440-10 or by e-mail at immediately. Please note that this communication does not constitute and may not be construed as investment advice and / or referral to buy or sell financial instruments. Unless specified otherwise, the views expressed in this communication are solely subjective notions of the individual sender and / or the entity or individual stated as the author of any information submitted. Performance in the past may in no case be considered as an indication for future performance. Please also note that Schröder Equities GmbH and / or its officers or employees may have interests in financial instruments referred to this communication. A current list of shareholdings can be emailed on request. Furthermore, our clients are hereby informed that Schröder Equities GmbH renders advisory services to Nestor Australien Fonds, an investment fund administered by Nestor Investment Management S.A. Luxemburg. Please also note that e-mails can be intercepted by