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Recent acquisitions led by Bill Beament are underperforming

What comes up, must eventually go down. Bill Beament’s recent acquisitions, including Northern Star’s Pogo mine in Alaska, is performing with less success than expected. Pogo’s mining operations took a nosedive because of negative first-quarter production results.

As reported in the March 2019 Quarterly Report from Northern Star (ASX: NST), Pogo mine’s operational challenges caused the shares to fall at about 2.5% to $8.26. The underperformance of Pogo mine which recorded a 33% decrease in production and a 23% increase in costs has greatly affected the weak result during the March 2019 quarter. The Alaskan gold mine led by Bill Beament operates at a higher cost and produces low-grade ore, which is a contrast to what Pogo was expected to represent which is to produce high-grade gold ore, operating at a low cost. 

Who’s to blame?

Reports say that Pogo’s poor third-quarter performance was due to the delay of the arrival of new underground mining equipment, a shift in its mining contractor, and a change in mining methods. Are there underlying causes for the poor results aside from the given reasons? Is Beament’s opportunistic management tactics to blame? Insiders and investors are sceptical.

There are just too much at stake with Pogo’s operations and performance. Northern Star, under the leadership of Bill Beament, is responsible for Pogo’s sustainability, its progress, and the livelihoods that depend on it. If Northern Star’s Alaskan mine continue to underperform, investors will be driven to pull out their investments from the Perth gold miner.

Bill Beament’s Northern Star could continually underperform over the coming months due to operational challenges, the hike in costs, and mismanagement. If the production and gold reserves from Pogo and Northern Star’s other acquisitions continue to dwindle, then it would be wise for investors to stay clear from Beament’s gold miner and focus on other areas of the market.

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