Soaring gold price helps Kalgoorlie Super Pit owners Saracen and Northern Star move up ASX rich list

The joint-venture owners of Kalgoorlie-Boulder’s Super Pit have moved up the rankings in WA’s top 10 biggest ASX-listed companies. Number- crunching and analysis by Deloitte Australia released today reveals Northern Star Resources, with a market capitalisation of nearly $10 billion at the end of June, finished the 2019-20 financial year in fourth spot — up from fifth spot in the previous year. Saracen Mineral Holdings also moved up the ladder from seventh to sixth place year-on-year after nearly doubling its market cap from just more than $3b last year to nearly $6b at the end of June. That comes after Saracen and Northern Star snapped up the Super Pit from its foreign owners for a combined $2.2b at the end of last year. The respective deals meant for the first time in its 30-year history, the patch of ground once deemed the world’s richest mile was in West Australian hands. The gold miners are joined in Deloitte’s WA top 10 index by two other companies with operations in the Goldfields. Mixed metals producer IGO, which owns the Nova nickel mine in the Fraser Range, came in ninth with a market cap of $2.88b. Northern Goldfields mid-tier goldminer Regis Resources rounds out the list in 10th spot with a market cap of $2.65b. Deloitte WA audit and assurance partner Dave Andrews said favourable commodity price moves had been reflected in the index. But Mr Andrews said the index composition had not always been so skewed to the resources sector. “At inception of the Deloitte WA Index in mid-2000, the composition of the top 10 showed a reasonable degree of diversification,” he said. “While energy and resources still dominated the mix at 50 per cent, WA had several significant corporates domiciled in the State playing in other industry sectors.” The top 10 companies by market capitalisation at the start of WA Index tracking included Wesfarmers, Woodside Petroleum, Homestake Mining, Bank of Western Australia, Foodland Associated, Franked Income Fund, Videlli Corporation and Seven West Media, owner of the Kalgoorlie Miner. Mr Andrews said 20 years later the diversification “almost vanishes”. “Apart from Wesfarmers and Woodside, all other top 10 companies at 30 June 2020 are in the metals and mining sector,” he said. The only non-energy and resources focused company holding a top 10 position in the WA Index at both June 30 2000 and June 30 2020 is Wesfarmers. Mr Andrews said the other notable theme from the analysis of the past two decades was the rise of WA-based gold companies in the index. “With four producers in the top 10, and 10 gold-focused companies occupying the top 20, the importance of gold to the WA Index cannot be ignored,” he said. “It’s a well-known fact gold is considered a safe-haven asset in times of economic uncertainty, and with Brexit, the US-China trade wars, and a global COVID-19 pandemic, we are not surprised to have seen investors flock to add gold exposure to portfolios over recent years.” Other notable movers in the index were Ramelius Resources, which increased its market cap 236 per cent from $477 million to $1.6b at the end of June. Rox Resources, with a joint-venture gold project south-east of Leinster, grew its market cap by 824 per cent to $167m at the end of June. Mr Andrews said since the virus outbreak early this year, investors remained on edge and the risk of a second wave remained clear and present. “The market reaction to COVID-19 has been profound,” he said. “Following the first confirmed case of COVID-19 in Australia in late January 2020, the WA Index fell 27 per cent from its high of approximately $200b at January 31 2020 to $151.3b at March 31 2020.”