Defence and gold drove the growth in value of Western Australia’s listed companies last financial year, fueled geopolitical uncertainty and economic instability.
Defence and gold drove the growth in value of Western Australia’s listed companies last financial year, fueled geopolitical uncertainty and economic instability.
WA’s overall listed company market capitalisation grew 3.7 per cent year on year, to $362.7 billion, according to Deloitte’s annual WA Index publication.
Fueled by record prices as central banks and retail investors buy up in the safe haven asset, gold companies made up nine of the top 20 on the index – ranked by market capitalisation.
The number was up from six last year.
“Given gold is having such a strong run, it’s logical that of the $362.7 billion WA market capitalisation, $55.4 billion comes from nine gold producers sitting in the Top 20,” Deloitte national mining and metals leader Nicki Ivory said.
“In a world of uncertainty, gold remains the safe haven investment choice.”
Northern Star Resources, Genesis Minerals, Perseus Mining Capricorn Metals, Gold Road Resources, Regis Resources, Ramelius Resources, Vault Minerals and Westgold Resources all made the top 20 on the list.
Wesfarmers remained WA’s largest company by market cap, with Fortescue in second and Woodside Energy in third.
No company within the top 20 oversaw as dramatic a rise as defence focused shipbuilder Austal, which increased its market capitalisation by 193 per cent year on year.
Regis Resources (150 per cent) and Genesis Minerals (147 per cent) followed closely behind.
On the other end of the scale was Mineral Resources, where market capitalisation fell by 60 per cent year-on-year as the result of a governance scandal, and lithium miner Pilbara Minerals – down 54 per cent as it weathered the storm of a commodity cycle trough.
Similar impacts were felt at IGO, where market capitalisation shrunk 26 per cent, and Liontown Resources – which dropped from number 18 in last year’s list to number 28 in this year’s.
Gold dominated the M&A conversation – a factor sure to rear its head again at this year’s Diggers & Dealers Mining Forum kicking off in Kalgoorlie this morning.
Deloitte audit and assurance partner Ian Skelton suggested there may be more to come on that front.
“The acquiring miners have seen sizeable increases in their scale and market capitalisation,” he said of deals made over the 12 months to June 30.
“Deals at the beginning of the year, which were thought to be expensive at the time, are now paying back shareholder confidence as the gold price continues its ascent. It leaves us asking the question: ‘Who will be next?’.”
