Hummingbird Resources

Hummingbird Resources, the West African focused gold development company, announced today updated economics on its 85% owned Yanfolila project in Mali. Assuming a US$1,100/oz gold price the NPV8 has increased 24% to US$109m and the IRR to 42%. The all in sustaining cost (AISC) reduces to US$686/oz. This compares with an NPV8 of US$88m, IRR of 37% and AISC of US$720/oz from the DFS (16 January 2016). When considering a US$1,250/oz the updated model delivers a much higher NPV of US$162m, an IRR of 60% and AISC of US$695/oz. Hummingbird offers lost-cost, near-term gold production and we expect a re-rating of the stock once financing of the US$79m Yanofilia project has been finalised in the next few months. In the meantime, we update our target price to 82p (from 60p). Speculative Buy – 29/02/16

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