Transcription of The Stock Network Interview with Ramelius Resources (ASX:RMS) Managing Director and CEO, Mark Zeptner
Lel Smits: Ramelius Resources is an established Western Australian gold miner which owns and operates two production and processing hubs at Mount Magnet and Edna May. It also mines and hauls ore from its satellite operations and is currently developing its Rebecca Rowe and Kew Gold projects. The company recently announced a transformational merger with fellow ASX Gold Outfit Spark Resources which is set to create a leading Western Australian gold producer with significant exploration upside. Ahead of appearing at Noosa Mining, Ramelius Resources Managing Director and CEO Mark Zeptner joins me. Mark, welcome to the Stock Network.
Mark Zeptner: Thank you for having me.
Lel Smits: Now, Ramelius recently announced the merger with Spartan Resources in a deal that values the combined group at more than $4 billion. What’s the strategic rationale behind this tie-up?
Mark Zeptner: It’s actually rare that you find two gold companies where their primary assets are just 65 kilometres apart, which in our mind leads to real operational synergies once combined and the ability to combine an operator with significant cash flows and an outstanding balance sheet in Ramelius with a successful explorer who is currently developing one of the best gold assets, gold discoveries in recent times in Australia, in Spartan. We think that deal is really attractive to shareholders on both sides.
There’ll be increased liquidity and appeal to institutional shareholders with the potential down the track to move into the ASX100. Ramelius has long had a strategy to grow beyond 300,000 ounces per annum and the combination with Spartan will enable the company to do that and more.
Lel Smits: Excellent. Now, in FY24, Ramelius produced around 300,000 ounces of gold from your existing operations. How does the marriage with Spartan impact your future production profile and growth potential?
Mark Zeptner: That’s true, Lel. We’ve been producing between 250 and 300,000 ounces a year for several years now and the exciting aspect of this combination is the ability to production significantly beyond that over the next five years. We have a vision of being at 500,000 ounces by FY30. Further to that, we believe that this growth will come at a similar low cost level that we’re currently enjoying, where Ramelius is one of the lowest cost producers on the ASX.
Importantly, we have shown that Mount Magna, which is our flagship operation to have a very long life, almost 20 years in fact. And we believe that the Dalgoranga asset, which is Spartan’s primary asset, will also have a long life with obvious exploration potential to combine both assets and the ability to turn the Mount Magna hub as we see it into a plus 300,000 an ounce a year asset. We really put it amongst the top tier assets, gold assets on the ASX. Well, they are ambitious plans, but a lot of progress to date.
Lel Smits: Thank you so much for updating us and look forward to hearing more at the Noosa Mining Conference.
Mark Zeptner: As it turns out, the deal could well complete shortly after the Noosa Conference, something we’re very much looking forward to. The result will be by market cap anyway, either the third or fourth largest domestic ASX gold producer with a compelling production growth profile at industry leading costs. Over the past five years, I’ll just quickly mention we have paid a dividend and we look forward to continuing to provide meaningful returns for our shareholders.
Lel Smits: Mark, thank you so much for the update on your company.
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