1st Jul 2015 09:14
LONDON (Alliance News) - South Africa-based gold exploration and production company Central Rand Gold Ltd Wednesday posted a widened pretax loss for 2014, and said it "eagerly" awaits the completion of the final negotiations for the sale of its Dutch subsidiary.
Shares in Central Rand Gold traded up 15% at 14.99 pence Wednesday morning.
The company has a range of assets, all in South Africa, that are held in its Central Rand Gold (Netherlands Antilles) NV subsidiary. Central Rand Gold said it saw strong interest in the potential purchase of this subsidiary from Asian based investors.
Three companies submitted similar offers of not more than USD150 million with a target date of completion of end-March 2015. However this target date was extended to June to allow a fourth bidder to come forward. The field of bidders was narrowed from four to two, and the remaining bidders requested a one-month extension to July 15 to complete due diligence.
The company posted a pretax loss of USD15.3 million in 2014, widened from a pretax loss of USD14.8 million a year before, as revenue declined to USD8.2 million from USD14.6 million, although this was partly offset by a reduction in production costs to USD9.8 million from USD16.3 million.
Central Rand Gold attributed its fall in revenue to operations underground mining being ceased during the year due to flooding, and whilst the company worked to secure sufficient surface material to sustain operations, this yielded low-grade resources that would not ordinarily be economic.
The company expects to recommence underground mining by the end of 2016.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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