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Silver Lake Resources Shares Shine As Gold Prices Recover

Jul. 23, 2013 2:02 AM ET
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Seeking Alpha Analyst Since 2009

Proactiveinvestors is a leading multi-media news organisation, investor portal and events management business with offices in New York, Sydney, Toronto, Frankfurt and London. Proactiveinvestors operates five financial websites in four languages providing breaking news, comment and analysis on hundreds of listed companies across the globe daily. We are one of the fastest growing financial media portals in the world. The group also operates hugely successful “investor forums” where three or four companies present to an audience of high net sophisticated investors, fund managers, hedge funds, private client brokers and analysts. Ian Mclelland founded Proactiveinvestors in 2006 as a way to channel his own views on companies small and mid-cap public companies. What started as a hobby quickly turned into a full time job as the website's readership exploded. One2One forums were added later in 2006, and within two years the company had expanded its operations into Canada and Australia. In 2009 the company expanded into Germany and finally into the US in 2010. Proactiveinvestors is now one of the fastest growing global financial media organizations in the world receiving more than one million visitors per month, with investor forums held across the globe on a regular basis.

Silver Lake Resources (ASX: SLR) shares have climbed 57% since the $0.555 low around a month ago on 26 June 2013, as a climbing gold price, falling Australian dollar and cost cutting initiatives have provided positive price re-rating catalysts.

This is highlighted by this morning's 3.59% increase to $0.865 as gold futures soared 3.3% Monday to settle at $1,336 an ounce on Comex - the biggest one-day gain for the yellow metal in over one year.

Silver Lake has continued to increase gold production from its operations in the Eastern Goldfields and Murchison districts of Western Australia, with full year gold sales of 151,060 ounces for financial year 2013.

This consists of 135,282 ounces from Mount Monger and 15,778 ounces from Murchison Gold.

Production in the June 2013 quarter accounted for more than a third of this at 56,450 ounces, indicating that gold production in the 2014 financial year will be higher.

Silver Lake's current JORC Resource and Reserve of 6.6 million ounces of gold, 10 million ounces of silver and 140,000 tonnes of copper also offer considerable room to grow production further.

However, the company is not standing still and is continuing work to grow its Resources to 10 million ounces of gold.

It is also finalising its Financial Year 2014 budget, which will take into account the decline in A$ gold price, and will focus on deferring capital, reducing costs across the business and maximising cashflow.

This includes a decision to defer the development of the underground Caustons mine for about 12 months, which will not have an impact on this year's coming production.


With physical gold demand remaining strong from Asia, continuing economic stimulus likely from Japan and the U.S. and plans by Silver Lake in place to maintain or improve margins, shares in Silver Lake could see further increases in the mid-term.

Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX "Small and Mid-cap" stocks with distribution in Australia, UK, North America and Hong Kong / China.

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