Perseus Mining Limited

Jeff Quartermaine - MD & CEO

Cathy Moises - Evans & Partners Reg Spencer - Canaccord Genuity Kurt Walker - Morgan Stanley Michael Slifirski - Credit Suisse

Thank you very much and welcome to our conference call to discuss Perseus's September 2015 quarterly report. As in the past, the start of all of that call I apologize in advance to those who had inconvenience by the timing of this call.

It is difficult to accommodate all time zones, as I'm sure you would appreciate. In summary it's been another very solid quarter for Perseus.

We've produced gold in line with our half year production guidance and now all inside costs are coming under the half year guidance range as well, thanks to some very significant cost reductions in product mining and processing. This has enabled us to continue to generate cash during the quarter and to build our working capital position such as the company is in a pretty strong financial position.

It being said, not only do we offer investors a significant leverage to the gold price in a rising market but we've also managed to insulate ourselves through having a healthy cash buffer in the event that the gold price gives a bit of its recent gains back. And what we've also done is we've given ourselves the means of providing real capital growth to our shareholders should we feel that we can achieve this with the right balance of risk and return.

So what I'd like to do is to talk in more detail about what we have actually delivered during the quarter and I'll start off with the operations at Edikan in Ghana. So gold production for the quarter was 44,267 ounces, which was less than the record that we set in the June quarter of this year.

It's still a very credible result given the average head great of all those prices during the quarter. And for the first half of the quarter while although still being mined from the Stage 3 of the AG pit, we produced gold that are very similar to our record June quarter.

However, as the quarter progressed and we reached the bottom of the Stage 3 pit we had to switch to drawing ore from our stockpiles while waste was being stripped out of Fobinso and the Eastern pits, and this meant that the grade of ore processed reduced sharply inside gold production in the second half of the quarter. Now this turn of events shouldn't come as a surprise to anyone as it was very clearly flagged in our June quarter report that this was likely to happen and was the direct result of us being delayed in gaining access to the Eastern pits mining area by the regulators.

It didn't come through formally until around the middle of July. Now I won't comment any further on that matter but suffice to say it was a very frustrating experience for us waiting for that final green light to be given.

But the positive news is that now having got the go ahead and we're starting to get ore from the – by the Chirawewa under Fetish pits. And by the tons in grade of ore that will be drawn from that pits will improve in the December quarter, and that we have every expectation it will produce sufficient gold to meet our guidance range of 90,000 ounces to 100,000 ounces for the half year.

In the March and June quarters the following year starting in the first half of 2016 things will continue to improve and the second half of this financial year should be quite a bit better than the first half enabling us to achieve our full year guidance of 190,000 ounces to 210,000 ounces. So, we are reasonably comfortable with that guidance even though the first quarter was down a little on where we've been in the past.

We have to pay credit to our mining contractors, Rocksure and AMS, once we receive clearance from the regulators to start mining in the Eastern pits. AMS rapidly mobilize and we're in fact ready to respond to our requests to deploy additional equipment if the iron is flowing back as much last time as possible, and they have done very well and by the end of the December quarter we'll actually be ahead of budget as far as movements of material is concerned.

And as I said earlier on, we'll be back into where we certainly ensuring much improved production going forward. And specific achievements on that mining front so we moved the 3.8 million bcm of ore and waste during the period which is 135% more than in the June quarter.

So there was clearly a lot of activity out there in the in the pits. We produced some ore.

We produced about 273,000 tons of oxide at 0.68 grams per ton, and we produced about 430,000 tons of transition and primary ore at about 1.5 grams per ton. Very good grade but unfortunately not enough of it in terms of quantity to make a real difference.

And as I said the shortfall of tonnes mined relatively to the ore mined was drawn from the stockpiles. So according to stockpile of about a million tonnes during the period.

And I mentioned that halfway through the quarter we turned to those stockpiles and said the head drive dropped cost considerably. The average for the quarter was 0.93 grams per ton and that compares to about 1.36 grams per ton in the June quarter.

But overstating the lower head grade, from a processing perspective, another technique – there the technical premises remain very strong so we had elevated three grades and we had good recoveries in a view of the fact that we increased the blend of oxide and transitional ore to primary ore, neither of which are particularly suited to our processing but nevertheless the performance as the mill demonstrates very clearly that if we can feed reasonable grade to the front of that plant we get out plenty of gold at the back. And that given that the need to rely on stockpile ore it's only going to be witnessed for a fairly short while, the future for gold production is looking very promising.

On the cost front, our all inside costs were recently good this quarter notwithstanding the lower head drives and therefore lower gold production. In the September quarter our all-in cost averaged about $1,060 an ounce, that was about 4% if you lie at the bottom end of the guidance range of 1,150 to 1,300.

Now certainly compared to the June quarter that was an increase of some proportion, the vast majority of which related to the volume. So if you produce well – then your cost per ounce is going to be higher.

Having also moved substantially greater quantities of material the amount of money spent on mining during the quarter was also up, so that accounts for the increase from the previous quarter but nevertheless it's still within the related guidance range which was quite pleasing. Now the reason why we are able to keep costs under control, not spending in the production was very – we're seeing some very material reductions in both unit mining and unit processing costs.

So to put that in perspective the unit mining cost in the September quarter was $2.35 a ton, and that compared very well to the $4.28 in the June quarter. Similarly the processing was at $9.10 and that compared well to the – it was about 15% actually below what we had seen in the previous quarter.

Now the reason for the very material drop in mining cost is actually a 45% drop, there are several factors as guideline to that. One is that, as you'll recall we have negotiated new rates under our mining contracts and in this quarter those lower rates took full effects and that was certainly a plus.

The other factor that contributed was that with the substantially larger number of tonnes of material being mined, we were able to spend our fixed cost saving more tonnes, so that helped them in unit prices. And the other fact that was very material was that we are mining in the top of the pits, so the material we're mining is relatively soft compared to the bottom of the pits.

That means that the amount of drilling and blasting required is lower and it also means that the amount of vertical climb out of the pit is lower. So, all of those things contributed to that very good mining performance, mining cost performance and which contributed to the overall result.

And what is not too differently, the processing cost has also reduced by 50% as I said earlier, during the quarter. We processed 4% more and that certainly helped us in terms of the quantity side of things, so that accounted for about 34% of the $0.34 per ton reduction in the mining and the processing cost.

The balance of $1.29 is the difference came back through renegotiation of range of supply contracts. So for example, sign a contract, we saw material reductions, there we saw some reductions in the energy cost back in terms of electricity and diesel and we were more efficient in high use of contractors and consultants, and all of those things combined reduced the prices because one thing we did see during the quarter was an increase in royalty, the royalties for this quarter was $133 an ounce.

Now this is an abnormal situation and basically reflect as the fact that in the June quarter quite a number of the shipments that we head towards the end of the quarter were actually at our site [ph] and so the payment of royalties didn't fall in the June quarter, it fell in this quarter, and that accounts for that increase. Going forward we will pull back to a more normal level if I can describe in that way to something around the $85 an ounce rather $133 or so.

Expenditure of sustaining and development capital remained relatively stable during the period. I do note that we are advancing work on infrastructure and relocation, housing, and I'll talk about that in a moment.

So we will see some increase in the CapEx side of things going forward from here but that is contained well within our guidance cuts. So, in summary while gold production and cost performance in the September quarter was enough for the very high standard that we set in the prior quarter, we're very much on-track and we believe we can certainly achieve guidance but you can be certain that we'll be aiming to do a lot better than that if we could possibly do it.

Our gold sales during the quarter, we saw 45,344 ounces and the average price was $1,291, now that was fairly well above the average stock price during that period. We delivered some of the gold into forward contracts at $1,600 but the balance were into spot sales and spot forward contracts.

It's suffice to say that the margin over the spot price was the result of a very conscious effort on our part to manage that revenue line and that's something that we'll continue to do going forward. Just a couple of other points around the Edikan probably that should be mentioned.

We have talked about this in the past, one was the access to the Eastern pits which has been problematic for some time, as I had mentioned earlier we did get that formal approval. And we did get it in July.

I was – been on site, this week in fact just come off the site now and I can say that I am – it's doing a very, very effective job in getting underway and moved a lot of material in a short period of time. In fact both contractors, the Rocksure guys in the pits are also doing a very good job and we will be starting to see some improved ore grades coming through and we're looking forward to some good performances going forward of the back of that.

The other thing that we have been doing which a lot of people are being interested in, like is the relocation housing project. So as you are aware, we do need to build some houses to accommodate residents of the mining areas that we're planning to move into although we have moved into in recent times.

Late in the June quarter we ordered a civil construction contractor PW Ghana to carry out the earthworks required to what we refer to as one of the housing project. PW mobilized during the quarter and now are going very well relative to play, and I did get it right to a bit of a slow start but it have in fact mobilized more equipment almost required under the contract and like the mining contractors, they are working very hard to recover lost time.

And I'm very certain that, that is likely to happen. In September we also awarded the first of our housing construction contracts to a Ghanaian company called Wilhelm Construction, and they will build the first 46 houses which are earmarked to relocate people who are formerly living in the Eastern pits area, and I should say that those people have already moved out, most of them already moved out and are living in rental accommodation and when the houses are complete they will move into the new houses.

The point of that comment is that we are able to mine in those territories, we don't need to move people right now as they have already gone. Now Wilhelm are getting ready to mobilize this side and now they will do so as soon as the building permits are in place and this should be a formality as everything that's been asked of us has been done and we are simply waiting on the bureaucratic processes to take their effect.

But we are optimistic that that will be resolved fairly shortly. Tenders for another 153 houses are due to be received tomorrow, October 23, our intention is to split that package into three separate construction contracts and all these houses will be complete or should be complete by December 2016 in time for us to move residents from the sludge and those area into their new houses and get started in mining operations.

So first the relocation project at Fetish and Esuajah in office concerned, we're tracking pretty much on-schedule, and we are actually on the budget as far as this exercise is concerned. In fact we're well under budget on the forecasts that were made a couple of years ago.

The expenditure going for, we are expecting $16.7 million to be spending in fiscal 2016 and $35.4 million in 2017. But I think given the tender prices we've been seeing of late, we are more likely than not to come in under those levels but I guess we have to wait and see for sure.

As always in Ghana, and in many parts of West Africa nothing can be taken for granted, and I have to add to rider that these plans to get this work done will be achieved subject to nothing coming out of left field and nothing is off course, so touch wood on that particular school. So this quarter we've seen a lot of progress at Edikan and we've certainly continue to keep goals there and I think that as we've said earlier on, we are fairly comfortable that we're on-track for guidance and the next quarter should certainly support that.

And for some time now we've been demonstrating the things at Edikan that are pretty well under control now. We're the first to admit that not everything happens according to plan all the time, we do have the odd setback and they'll continue to happen.

But when they do happen we respond very well and we find ways to get back on-track and this quarter has certainly been no exception as far as that's concerned, judging by the mining performance, the performance in processing, the relocation housing, and the management of government relations which is no small task but initially. Switching our focus to the second project, that's the Sissingué Project in Cote d’Ivoire.

Now, significant progresses we made during the quarter on Sissingué and we're now positioning – we positioned ourselves very well to be able to take a development decision one way or the other later in this quarter. Given where we sit today the decision around Sissingué is interesting and it's not absolutely straightforward, a very strong case can be made by the proceeding with the development and also an equally strong case for are not proceeding at this particular juncture.

And we're working our way through the issues and I expected a sound decision – a sound and wise decision will be taken later in the quarter. Recognizing the strategic importance to purchase in terms of financial and risk mitigation benefits of having a second income stream.

In a different geopolitical setting and that is important for us strategically. Also recognizing the relative attractiveness of the risk versus reward balance versus compared to other investment opportunities and I just repeat the point that $1,200 an ounce the internal rate of return is 27% real and $1,100 that falls down to about 16% real.

So they are not bad returns on the project which albeit is not the largest projects in the world. However, countering that the status of the gold market and person's ability to fund this development without putting on to pressure on the balance sheet in a volatile market is something that does exercise a month, we do have a healthy cash balance at the moment but whether we want to run this down right now is a serious question that needs to be considered, and finally we need to be comfortable with continued political stability in sound community or nations and security in Cote d’Ivoire.

I do know that there is an election, the Presidential election taking place on the 25th in October, it's been a very relatively calm lead up to that election and we're not expecting anything adverse to come following the election but one never knows and we certainly want to see how that plays out for before taking a call. Now notwithstanding this looming decision point we have pressed ahead as I said during the quarter with Sissingué, we've made very good progress at a number of fronts to get the project to a development-ready status.

We signed the mining convention for Sissingué with the government in late July, so that guarantees of fiscal stability, it guarantees five-year tax holidays etcetera which is very helpful for a project of the nature of Sissingué. Our engineering consultants like a podium have moved forward on the front of engineering design, done a very good job there and are running ahead of schedule and under budget on that.

We developed our organization structure for basic construction and operating size and we commenced recruitment of some select staff to give that a flying start messing got forth. We've established a recruitment committee in the involving representatives of all the villages in the area, in the vicinity of Sissingué site, thus people have received the title when it comes to selecting live.

There is a sense of community involvement, an important sense of community involvement. We have commenced an early works program, the budgeted pullback program is about $7.5 million and it involves things like engineering works, building roads, fences, water boards, procurement at the camp, etcetera, that is travelling well on plan and making very good progress there.

We're also involved in a program of engaging all the national, regional and local governments and community security stakeholders. And we're doing that to ensure that there is a continued commitment to security around the Sissingué area.

We do note that Sissingué is located on the border of Cote d’Ivoire and being located to a border anyway does represent a risk. So working on security relationships at this stage I think we pay very large dividends down the track should we go ahead with the project.

I can't tell lot more about Sissingué right now other than to note once again the strategic importance of developing that income stream and getting some geopolitical diversity into the portfolio, it is compelling. However, we are abundantly aware of the risks we're running down cash balances and taking on debt at the moment.

And then the entire next couple of weeks are going to be very important as to whether we take a decision or not but if we do take a positive decision and as we certainly in the frame then we'll hit the deck running and we should be able to produce gold from Sissingué within about 12 months from the start time. On the exploration front we haven't done terribly much drilling this quarter, what we have done now is to embark on a study of data relating to the Edikan property, in particular, looking for higher grade target.

There are some obvious targets that were there from last year's drilling program, for example, the South, our last drill program indicated a possible extension of the old body in depth and we have commenced some drilling down there and while we haven't got that size at this stage, our drillers and geologists are very encouraged by the call that's coming back. So that is good news – well, I hope its good news at least, and if it is, then we'll share that with you fairly shortly.

And I mentioned earlier on now that we priced ourselves into a relatively strong financial position and that is definitely the case. Our working capital, networking capital at the end of September was $191 million, an increase of $13.5 million during the quarter.

Our cash in volume was valued at $132 million at the end of the quarter, about $4.5 million more than the balance at the end of the previous quarter. So we are certainly improving the cash and building cash itself was $123 million at the end of the quarter which was about $20 million more than the previous quarter.

We had 5,267 ounces of gold on hand at the end of the quarter as well, and that had a value of about $8.4 million, so between the $123 million of cash I thought millions of bullion we came up with $132 million. I should point out that these balances don't include the further $13.6 million of cash that's held on the positive accounts to provide security for various rehabilitation works going forward.

I mentioned earlier, the sales of 45,344 ounces provided average price of $1,291, that was a pretty reasonable result given the spot price was. The hedge book is also fairly well positioned, we've got a 149,100 ounces of gold sold forward at a weighted average price of $1,240 an ounce.

And that book was in the money to the extent of about $26 million at the end of June, about $5 million more than at the end of September, about $5 million more than what was in June. Creditors were up slightly at around $40 million at the end of the quarter.

I think a significant amount of that if I'm not mistaken was related to foreign exchange move because much of these creditors are in U.S. dollars.

That was particularly notable but there was a small increase. We did remain debt free during the period, we did say at the end of last quarter that we were considering raising $80 million of corporate debt, we've looked pretty closely at that plan and we are currently revising that plan because what we would like to do in terms of expenditure going forward is to place a greater emphasis on internal cash resources and to fund the capital program and reduce any possible balance sheet pressure in a difficult market segment.

We are looking very closely at that frontload funding arrangements and I think that something sensible will come out of that in due course. All in all, it's been another productive quarter for Perseus, we have not performed as well as I said earlier as we did during the record quarter of June but we have performed exactly as planned and we have established a platform for better quarters ahead with the opening up of the new mining areas on the eastern side of our land holdings and also with some very intelligent assessment of a number of organic growth opportunities at Edikan, we'll talk about these more in coming period as these plans develop and certainly we can see some very good opportunities at Edikan to continue to improve our productivity and to continue to improve the value of that property.

We also our pushed ourselves along the Sissingué, we find ourselves in a position where we have some real choices going forward. And most importantly, we've got the financial ability to execute strategies if we think that they will deliver the sort of returns that our shareholders want and frankly, do deserve.

We just spend the last week or so and thought the Ghanaian team are going through both of their projects top-to-bottom. I have to say I'm very excited about what appears to lie ahead into course here.

If we can keep on course and not get sidetracked which as I said earlier, is something that we are doing quite tight into these days. So with that I'll close the – I'll stop my presentation and perhaps hand back to the moderator for questions.

Good evening, just a couple of questions. Your mining cost as you pointed out was particularly low and part of softness in the – you said the nature of the ore but looking forward compared to where we would have been expecting what sort of mining cost would you be expecting to get?

Another question relates to your stockpiles, when you quoted the average grade list, what sort of did you process during the quarter from the stockpile and looking to this quarter if you did get down continued delays in excessing the high growth material, what sort of grade you would be factoring in most stockpiles now representing the balance then the grade, it's like –

Okay, lot of questions there, so let me try and answer that. So mining costs, I mean we haven't gone out specifically with what our average mining cost will be over the life of the mining contracts.

However, I would point out that at this stage of the game they are on the low side it as we go forward and go deeper in the pits, that will increase slightly but the average will come in at around I think somewhere in the order of about $3.25 or so at a time when we take into account most of the contracts and average it out, either the entire period of those contracts because as we clearly know, as you get to the bottom of the pit things get harder and you've got to climb out of the bottom of the pit. So you got a long way hole and then speak value to the license.

So that's probably ballpark-ish kind of numbers I think. As for the stockpiles, we've said all along we've been reporting our stockpiles every quarter and we've been reporting them around the 6X to 7X.

And that's what we drill this month, this quarter, and that we'll drill off going forward. So I think the last point I think you're making – it was around stockpiles, look Cathy, we're going to – we were already getting ore from the pits and as the set out plans indicate that, that quantity of ore will steadily increase over the months coming forward as will the grade.

And by the end of this year, by December we'll be in fairly good condition again. So I don't think there will be – I can't imagine there will be any further delays in mining where mining head out at fairly cost rights at the moment.

So we're pretty comfortable with that thought.

Thanks, Jeff. That's great.

Thank you, thanks Jeff. Just a couple of questions from May.

Are you able to provide or give us a number on what do you expect the strip ratio to actually being over the course of FY '16?

I probably could if I knew that was at the top of my head but I can't say I do – what I would do there. I really just refer you to the larger mine plan that we published earlier this year or last year and those statistics are very clearly articulated in that document.

And there has been no variation from those probably sense of things?

No, not of any material much, no.

Okay, thank you. Next question is on…

Sorry – factored into that plan, most effective we would most likely be dealing with stockpiles group for couple of months and that's precisely what has transpired.

I understand, thanks. And the next question is just on the hedge, if we go back to your FY '15 results where you announced that you had taken out some more hedging, at that point it's only at 149,500 ounces at about $1,239.

You reported that you delivered some additional ounces into the hedge which I would have presumed would reduce that balance, but it's only come down a little bit. Was there anymore hedging taken out during the last couple of months?

Look what we do Reg is we roll the positions, we roll them. So we deliver low and we take the opportunity to replace low hedges with higher prices and that's why if you look at reported average hedged prices over a period of time, quite often they are moving upwards, relatively moving upwards.

To answer your question, yes we have done some - but we deliver into them at the site or deliver into the ones – replaced at the ones at the same time.

Okay, that answers my question. I think Cathy covered up one of my questions on mining costs, and that's it for me.

Thanks, Jeff.

Hi Jeff, you have covered off but I have few more questions. Just quickly on Sissingué, provided the elections and the same government this weekend, you've already engaged with the community out there, probably talking jobs, you've got a mining convention signed.

How much pressure is on you to develop that project up there? Is there used diluted portion or are the discussions fairly open-ended and I understand the time one of these things.

Look we've had very constructive discussions with the government all along and I should say that they have been extremely constructive and we've been working very closely together to get to where we are now. I think there is a very good understanding of the issues on the part of the government as there is a very good understanding of the government's imperatives by us.

I mean clearly, the government would like a project to be developed in the north of the country to employ opportunities, etcetera, etcetera. However, while we understand that and we applaud that thought, we are at the end of a commercial organization and that isn't our primary driver.

I don't believe that we have a mining convention at the present time and the mining convention specifies various types as to when we should be doing things. We have a reasonable amount of flexibility going forward, so we're not even considering loss of the property or anything like that at this stage of the game, what we are doing is focusing on putting as much information on the table as we possibly can say that we can make a fully informed decision later in the quarter.

Sure, that's great. Thank you very much.

Thanks Jeff, congratulations on that cost result that was really terrific to see, I was skeptical, so well done. I've got three or four questions.

First of all, on costs, where are you on the journey all the low hanging fruit, not that any of those are really about hanging but it's the bulk of the cost opportunities behind you now is getting more difficult to find costs to remove?

No, I mean we said we have knocked off the obvious targets and what we have been doing Michael is working through each of our supply contracts as I come through yield. And there are still some of that that will be out there, we will negotiate further.

So things like explosives and profits, certainly opportunities for reducing costs, also looking at consumption rights of the consumables if we can be more efficient in the way we're processing for instance, we are in the presence of installing an oxygen plant into the circuit which does away with the need to put starting peroxide into the circuit and that actually saves a very significant amount of money just in itself. So there are those opportunities and I briefly alluded to the fact that we are looking at other productivity improvements on the circuit which will also have a benefit in terms of unit costs going forward if they delivered what the preliminary analysis suggests they might.

But in each of those sort of instances each opportunity will be valued on its merits and we'll be looking for incremental return on investment in each case that we're fairly hopefully that we have identified a couple of things that should help things along the way but it is too early to be talking in any kind of quantitative value about that.

Fine, thank you. Looking into the second question which is about the no rights and clearly up because of the soft drill but was there anything else in terms of performance that would give you a sustainable increment for the same equivalent hardness you were trading previously?

I'm not really – I mean, I think there were sort of as well as it being upside there was actually drawing from the stockpiles, there was a lot of gains in the material. Had it been downside that metal that this metal was crushing and grinding was involved in that material, so that gave things a bit of a lift in terms of alley throughput rights.

We've said in the past that maintenance is something that we need to focus on very heavily and that has continued during the period that we still think that there is room for improvement in terms of maintenance and to make sure that we work more randomly for more out than we currently do.

Okay, thank you. And thirdly, the finance facility that you've been planning the $80 million, how far did you get in your negotiations and did you give indicative terms since there might have been terms and conditions that you might have been targeting?

Yes, we do that. Well, put it this way, we got down to two banks and they signed that we signed our mandate matter with them but I think that let time progress and I spoke to our stakeholders and we looked more carefully at the situation.

We felt that we needed to perhaps reconsider the approach that we were taking and to find a way that I said would be less reliant on getting more aligned on internal cash. I mean, one of the other things that we wanted to change around was – we do have security in place already that covers the Ghanaian property, and it would be more cost efficient for us to use that structure rather to be creating new security around the company.

So there are a number of things that we were taking into account and I believe that what we come up with in the next short period of time will certainly be far more optimal than what we had conceded earlier on.

Okay. Then finally with respect to the Cote d’Ivoire election I haven't followed the politics at all, so it's a naive question but post the election, whatever the result is, how long do you need to wait to see whether there are any changes in approach from the government that could impact the returns from the project?

I don't know that we would necessarily be waiting to see them put their policies on the table but I guess what has happened in other countries, and in fact in Cote d’Ivoire in the like of the last election was that there was some civil disturbance. There hasn't been that level of disturbance in the country and I'm very optimistic that we're going to finish it guys although we did want to see what – exactly how things have.

I should say this that we did sign the mining convention with the government the other day, and that mining convention walks in the set of terms, fiscal terms surrounding this project and so irrespective of which government is elected or what their policies maybe, we have a contract which guarantees those terms. So it isn't really – we're not concerned from the point of view, our fiscal arrangements were just wanting to make sure that security across the country and facing stability is there because the last thing we want to do is to start a project where there is just harmony in the community before we start.

I think it's challenging enough to set aside the aspirations of local people as you go forward without getting off on a bad foot. So we want to make sure that when we do start the project that we're all in the same page, that everyone understands what their rights and obligations are, and then we can work towards – working very harmoniously going forward.

Thanks very much, Jeff.

[Indiscernible] I've got a large percentage in your company with more portfolio than any other gold mining at the moment because I'm impressed by a few things, the financial position, and your improvements and vision, and it's good to hear you communicating what you have. Thank you.

One thing I'm surprised is not mentioned in your financial position which I find quite impressive is your earnings per share which I just calculate is $0.174 per share, which produces a very impressive earnings ratio, just under 2.5. So first, considering that if you would because with the impact the profit takes $92 million, that certainly boding well for I think not – it's for others.

With that sort of platform that you have, the financial players won't – in terms of you've got no debt and that you're not likely to raise – careful about where are the rights issue which would dilute the values of shareholding for us. I have to say this but – can you explain perhaps earnings per share, is it due to a one-off event or the market continues strong?

Well, I can't make forecast as to what the market will do but look, I think the calculation is probably fairly accurate. I haven't actually got that number in front of me but it's fairly it is like.

I will point out if I may that a fairly significant piece of our profit that we earned last financial year was foreign exchange related and I guess that to some extent some investors done to you that is valuable as underlying profit that comes from production. So that maybe a factor that – I mean one way to take that notice of that because if you will recall in the prior financial year, so fiscal '14 we had a loss and there was a significant part of that loss was a foreign exchange loss at that time as well.

But we do go up and down a bit and that does has an impact but I think your analysis is basically correct that the earnings per share is relatively low. In the process the earnings ratios are attractive as well, now our financial condition is very strong as I articulated earlier and our opportunities for the future are looking good as well.

So I think hopefully we'll be able to convince other investors, not only just yourself but other investors that this is a good investment and that it's right at the outset we then provide exposure to the upside in a rising market but very importantly, we also have a pretty healthy buffer on the downside if things get impatient [ph] as far as the goal process is concerned from here.

Let me say foreign exchange related, do you mean specifically versus certain goals against the U.S. dollar or is it more around the hedging policy and the games you managed to produce or combination?

No, it's U.S. dollar because what we – in Ghana, the functional currency of our local subsidiary over there is U.S.

dollars and we have loans to that subsidiary in U.S. dollars, and then when they brought back to Australia where we are Australian company, we report in Australia, those is in the company lines are revalued from time to time on a U.S.

dollar basis and so that's where you see the major movements coming in.

Thank you very much for attending the call today. As I said it has been a fairly solid quarter for us, and we are looking for further improvements going forward and hopefully you'll be with us at the next call which will be in about three months from now.

Thank you very much.