27th Jul 2015 06:59
LONDON (Alliance News) - Acacia Mining PLC Monday reported a large fall in profit in the first half of 2015 due to higher costs and lower gold prices.
The FTSE 250-listed miner reported a pretax profit of USD25.0 million in the first half of 2015, dramatically falling from the USD62.2 million a year earlier despite revenue experiencing a small lift to USD446.8 million from USD445.5 million in the period.
The fall in profit was caused by its margin being squeezed alongside higher costs, as administrative expenses rose to USD18.3 million from USD14.0 million, share based payments rose to USD8.3 million from USD4.9 million whilst corporate and social responsibility costs increased to USD5.3 million from USD4.7 million.
Finance costs also rose to USD6.5 million from USD4.5 million with the only cost to come down in the period being its exploration expenditure, dropping to USD8.7 million from USD11.0 million a year earlier.
Despite the large fall in profit, Acacia retained its interim dividend of 1.4 cents per share, which is in line with the dividend paid for 2014.
Gold production in the first half totalled 367,301 ounces, 6% higher than the 346,581 ounces produced a year earlier, however its all-in cash cost rose 1% to USD1,133 per ounce. Gold sales rose to 355,470 ounces from 330,947 ounces but gold prices fell to an average of USD1,200 per ounce from USD1,290.
The miner retained its full year guidance to produce 750,000 to 800,000 ounces of gold as it expects the Bulyanhulu mine to increase production in the second half and the grades at North Mara to improve. Both projects are based in Tanzania.
"Primarily as a result of the ramp up at Bulyanhulu, the fourth quarter is anticipated to be the strongest quarter for production and consequentially the lowest for cash costs and all-in sustaining cash costs," said the company.
Acacia said capital expenditure for the full year will come in between USD200 to USD220 million whilst sustaining expenditure, including land purchases expected to total USD120 to USD130 million.
By Joshua Warner; [email protected]; @JoshAlliance
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