The St Barbara Ltd (ASX: SBM) share price is out of form on Tuesday.
In afternoon trade the gold miner's shares are down by 5% to $2.15.
Why is the St Barbara share price tumbling lower?
There have been a couple of catalysts for today's sizeable decline.
The first is a decline in the gold price which is weighing on most of Australia's leading gold miners.
The likes of Evolution Mining Ltd (ASX: EVN), Newcrest Mining Limited (ASX: NCM), and Northern Star Resources Ltd (ASX: NST) are all down sharply this afternoon. This has led to the S&P/ASX All Ordinaries Gold index sinking a disappointing 5.6% lower.
The catalyst for this appears to be better than expected economic data out of China.
According to CNBC, China's official manufacturing PMI for March was 52. This compares to economist expectations of a reading of 45.
PMI readings above 50 indicate expansion, while those below that level signal contraction.
A reading of 52 is quite remarkable given the how the country was battling the coronavirus during the month.
Operations update.
In addition to this, this afternoon St Barbara released an update on how the coronavirus was impacting its operations.
The company's advised that its three operations in Australia, Canada and Papua New Guinea have been able to maintain operations, production, and gold shipments at this time.
However, management acknowledged that increasingly stringent COVID‐19 prevention measures increase the risk that one or more of the operations may be impacted at some stage.
Nevertheless, management remains positive on the company's future.
It said: "The Company is in a sound financial position, with all three operations continuing to generate positive net cash flows, and internal financial modelling indicating the Company can readily withstand a prolonged hiatus in production across all operations."
Though, to reinforce its resilience, management has drawn down A$200 million from its existing syndicated debt facility. This will be used to bolster its cash reserves, which will be prudently conserved during this uncertain time.
Following the drawdown, St Barbara has approximately A$312 million cash at bank, with approximately A$315 million drawn on the syndicated debt facility.
