Red 5 Limited

Website: www.red5limited.com
Primary ticker: ASX:RED
Stage of development: Development
Commodity: Gold
Project to promote:King of the Hills 4Mtpa Open Pit in Western Australia
Project location: Australia


Cash: A$40M
Debt: A$20M

Major shareholders:
Franklin Advisers – 14.2%
Regal Funds Management – 9.5%
Ruffer LLP – 6.0%
Aims Asset Management – 4.2%
Platypus Asset Management – 3.9%
Management ownership – 1.4%

Red 5 Limited (ASX: RED) is an Australian gold producer that operates the Darlot and King of the Hills gold mines in the Eastern Goldfields region of Western Australia.
Since acquiring these two projects in October 2017, the Company has ramped-up gold production to an annualised run-rate of +100,000oz/year, and is conducting a number of strong exploration programs to increase its Resource and Reserve base.
In 2018, Red 5 identified a potential bulk mining opportunity at King of the Hills, and has since delineated a bulk Mineral Resource of 4.1Moz of contained gold. A Final Feasibility Study for an integrated bulk open pit and underground mining and processing operation is scheduled for completion in the September Quarter 2020.

Management Profile

Mr Mark Williams, Managing Director

A non-executive director since January 2014 and Managing Director since April 2014. Mr Williams was previously General Manager of the Tampakan Copper-Gold Project in southern Philippines from 2007 to 2013. He has over 20 years of mining experience operating within a diverse range of open cut, underground, quarrying and civil engineering environments across the developed markets of Australia, United Kingdom and New Zealand, as well as the emerging markets of Philippines, Vietnam, Thailand and South Pacific.


What is your rationale for taking part in 121 Mining Investment?

Red 5 is seeking to stay in touch with existing investors and meet potential new investors.


What recent news would you like to highlight to investors attending?

The King of the Hills bulk mining project is progressing rapidly to final Feasibility Study completion in the September 2020 quarter, supported by a 4.1Moz updated Resource released 19 March 2020, and a major equity raising of A$125M announced on 30 March 2020, as well as monthly status updates.
The Darlot currently producing mine also processes ore from the King of the Hills underground, and work is accelerating to build Darlot into a stand alone operation, including 31,200m underground drilling program, 11,100m surface drilling program, and to date the acquisition of Great Western deposit and options over Cables and Mission deposits.


What are your key goals for the next 3, 6 and 12 months?

3 Months:

Delivery of the King of the Hills Final Feasibility Study

6 Months:

King of the Hills financial close and start of construction subject to Board approval

12 Months:

Build out Darlot into a stand alone operation


What do you see as the key risks and challenges facing your company at the moment and how are you overcoming these?

Delivering the King of the Hills bulk project and maximizing cash flow from existing operations


What do you think makes your company such a compelling investment?

The King of the Hills project has been partly derisked by the recent major issue which provides a substantial part of the project funding, and will be further derisked with the completion of the Feasibility Study, financial close, and completion of construction.

Analyst Insight – provided by Independent Investment Research

Red 5 is an ASX-listed gold producer that operates the Darlot and King of the Hills gold mines in the Eastern Goldfields region of Western Australia.

The Darlot mine has a long production history, celebrating its 30-year anniversary of continuous gold production in November 2018, with total output of 17.8 million tonnes grading 4.8g/t Au for 2.8 million ounces of contained gold since mining commenced in November 1988.

Since acquiring these two projects in October 2017, the company has ramped-up gold production to an annualised run-rate of +100,000oz/year, and is conducting strong exploration programs to increase its Resource and Reserve base. These acquisitions provide Red 5 with an extensive strategic footprint in the world-class Leonora-Leinster mineral district of WA, with the ability to leverage this position by pursuing a regional consolidation strategy.

During 2018, Red 5 identified a potential bulk mining opportunity at King of the Hills, and has since delineated a bulk Mineral Resource of 4.1Moz of contained gold. A Final Feasibility Study for an integrated bulk open-pit and underground mining and processing operation is scheduled for completion in the September Quarter 2020.

In addition to its growing production profile, Red 5 is also conducting a major exploration program across its extensive strategic footprint in the world-class Leonora-Leinster mineral district of WA. This exploration program has delivered a string of positive results, including the discovery of an emerging bulk mining opportunity at King of the Hills.

In addition to its high-quality asset portfolio in the Eastern Goldfields, the Red 5 group also holds an interest in the Siana Gold Project, located on the island of Mindanao in the Philippines. The Siana Project is held under a Mineral Production Sharing Agreement (MPSA) by Greenstone Resources Corporation (a Red 5 Philippine affiliate company).

Mining operations at the Siana Project are currently suspended pending an improvement in operating conditions in the Philippines. Prior to the suspension, the deposit was mined by open-pit methods, with a plan to transition to underground mining following completion of the open-pit.