Group production for the quarter was 61,470 ounces of gold, comprising 34,141oz from Carosue Dam and 27,329oz from Thunderbox.
September was a strong month for gold production, with output of 23,900oz.
The ramp-up of Thunderbox continued, with production up by 23%, despite a four-week delay in the start of production at King of the Hills.
The result was slightly softer than the June quarter record production of 63,192oz, and below its forecast of 65,000oz, but keeps Saracen on track to meet full-year group guidance of 280,000oz.
“These results demonstrate that we are firmly on track to achieve our targeted 300,000oz per annum run-rate by the June quarter of 2017,” Saracen managing director Raleigh Finlayson said.
“At the same time, we are driving an extensive exploration program which we believe will grow the inventory and mine lives of both our operational centres.”
Production is expected to be 65,000oz in the current quarter before rising to 70,000oz in the March 2017 quarter and 80,000oz in the June quarter.
All-in sustaining costs are set to drop from around $A1400 an ounce in the current half to $1260/oz in the March quarter and $1000/oz, though the company said Thunderbox costs were tracking better than forecast.
Saracen had cash and bullion of $A42.5 million at the end of September, slightly higher than June, after spending $17.1 million on exploration and growth capital.
The company has set a $42 million exploration budget for the 2017 financial year.
RBC Capital Markets analyst Paul Hissey said the result was softer than forecast due to it not allowing for a strong second half of the year and aggressive price assumptions, which were around $200 an ounce higher than realised prices.
“Notwithstanding, we expect Saracen to gather momentum as we move through FY17, with increased production (and lower costs) eventually underpinning a re-rating in the stock,” he said.
“In addition, exploration success form the large budget is also likely to provide interim catalysts.”
Shares in Saracen fell by 0.8% to $1.23.
