Dacian Gold is clawing its way back into the market’s good books after hitting production targets at its Mt Morgans operations near Laverton.

Preliminary results for the September quarter reveal Dacian churned out 42,000 ounces of gold and finished with cash and gold of $53.9 million.

That marked an $8.3 million rise from the June quarter and came after a scheduled debt repayment of $10.8 million.

Dacian still bears the burden of $95 million in outstanding debt and will need to ramp up production by about 10 per cent in the latter half of the financial year to hit forecasted guidance.

But that did little to dampen the appetite of shareholders with Dacian’s shares rising 8.3 per cent at yesterday’s close.

Although it marks a milestone in the miner’s long road to redemption, Dacian is yet to regain its lustre of old.

Spooked investors sent Dacian’s shares plummeting by 67.5 per cent on June 5 after the miner cut production guidance for the second time in three months.

With $241 million wiped from the company’s value the savage battering continued the next day with Dacian’s share price falling another 14 per cent.

The company recovered some of its shine a month later when it unveiled a plan to produce 1.1 million ounces over an eight-year mine life at Mt Morgans, including between 150,000oz and 170,000oz this financial year.

Dacian yesterday said the September quarter’s production was well in line with the stated guidance for the first half of the financial year at 67,000-77,000 ounces.

Mill reconciliation was up at 100.7 per cent from 88.3 per cent in the June quarter.

Dacian Executive Chairman Rohan Williams yesterday said the September quarter was strong across the board at Mt Morgans.

That was echoed by RBC Capital Markets Mining Analyst Paul Hissey who said it appeared to be a solid quarter and a positive step “towards demonstrating the robustness of the new mine plan”.

But Mr Hissey warned there was a “near-term risk” associated with the planned ramp-up in production. 

Image: Dacian Executive Chairman Rohan Williams, The West Australian.