Larvotto Resources (ASX:LRV) is currently undertaking a recruitment drive, placing a strong focus on keeping staff turnover below the industry average.
With the company roughly eight months from start-up at its Hillgrove Antimony-Gold Project in New South Wales, Larvotto is ramping up efforts to find the right people.
Managing Director Ron Heeks considers the biggest risk facing an operation entering production is people.
“I don’t consider that we have a metallurgical risk. I don’t consider we have a mining risk. We’re in a spectacular location. So all of that helps, but in the history of start-ups over the last four or five years it’s all about people,” he says.
“There are many examples of mines that have had massive share price destruction because they haven’t met the targets that they’ve put out and largely that is because they haven’t actually been able to build the teams in the timeline that we want to get going.”
Rather than focusing on fly-in, fly-out, Larvotto wants to build a team based in the nearby town of Armidale.
Heeks says for most people it is not just a matter of taking a job, it is also about relocating.
This is why Larvotto has implemented a retention and reward program offering performance shares that vest in two years.
“We’re putting as much focus on incentivising people to one, move to Armidale and two, stay with us certainly for the first couple of years so that we can get all our procedures in place,” he says.
While dilution may be a concern for some shareholders given there will be more shares on issue, Heeks urges investors to focus on Larvotto’s market value.
Since Larvotto acquired the Hillgrove Project around 18 months ago, the company’s share price has jumped over 870% to $0.68, reaching as high as $1 in late March this year.
“I would ask people to focus more on what is the share price than how many shares are out there because that’s how you measure your wealth value and the value of the company,” he says.
“For us it is all about getting the job done and that will flow directly through to the market capitalisation and the share price of the company.”
Heeks also notes that if everybody in the company is a shareholder they are more likely to be aligned with the goal of successfully taking Hillgrove into production.
The industry workforce turnover at good operations is around 30%, according to Heeks.
“I think that’s a horrible number and we’re aiming at considerably less than that,” he says.
“We want to reduce that as much as possible – the costs for training, re-employing people, loss of knowledge, loss of IP through the project is quite incredible when you’re talking industry average numbers.
“We’re trying to retain people as much as humanly possible”
“We’re trying to retain people as much as humanly possible.”
Larvotto is building its team from the top down, with the majority of senior management now on site. The company is now recruiting for another couple of senior management positions that are not required for another three or four months.
Write to Angela East at Mining.com.au
Images: Larvotto Resources
