Wednesday, August 22, 2018
John Welborn

John Welborn

Resolute Mining

IT’S been an odd time for John Welborn’s Resolute Mining. The firm’s 30 June financial year-end ticked just about every box an investor would want ticked. Cash and equivalents more than tripled, a 300,000 oz production target was exceeded by 30,000 oz; the all-in sustaining cost margin was improved; and net profit was A$166m. It even paid a two Aussie cent/share dividend – in the form of gold through the Perth Mint – while it successfully bid for two blocks in terms of Egypt’s tender process for gold concessions in its Sinai and Eastern Desert. Resolute has stable operations at its Ravenswood mine in Australia, and Syama in Mali, as well as upside at Ghana’s Bibiani mine that will take total production to 400,000 oz/year. Yet for all this, the share price in 2017 was static. Welborn thinks it’s a lack of momentum in the re-development of Bibiani, and slow progress developing the brownfields potential of the 10m oz Syama mine that is holding back the share price. Welborn ended 2017 agreeing to sell 70,000 oz in gold hedges between now and May 2019. He also faced a curious AGM question that his rugby interests were distracting him from Resolute business – an allegation Resolute chairman, Martin Botha, kicked firmly into touch.

LIFE OF JOHN

Welborn describes himself as a rugby playing accountant, having represented the Wallabies, Western Force and even South Africa’s Sharks. He kept links to rugby as a Fox Sports commentator, but the lure of mining, after a period of investment banking at Investec, must have been too great. He was MD and CEO of Equatorial Resources during a period when the iron ore price summited and collapsed, leaving his plans in tatters. His return to prominence at Resolute has been a storming success.