7th Aug 2018 11:44
LONDON (Alliance News) - Griffin Mining Ltd on Tuesday warned on challenging second-half of 2018 as first-half profit declined on higher expenses.
The investment company reported pretax profit of USD21.3 million for the six months to the end of June, down 3.6% from USD22.1 million reported for the same period a year earlier, despite revenue climbing to USD54.1 million from USD52.3 million.
The result was hurt by higher operating expenses, which came in at USD9.7 million compared to USD8.1 million the year before.
During the period, Griffin Mining said it saw a record gold in concentrate production totalling 9,492 ounces, up 1.3% from 9,372 ounces a year prior. Meanwhile, zinc production fell year-on-year to 16,873 tonnes versus 19,553 tonnes and silver production reduced to 132,689 ounces from 168,426 ounces. Production of lead decreased to 459 tonnes from 719 tonnes.
Revenue from zinc metal in concentrate was USD42.6 million, up slightly from USD40.3 million received a year earlier, as average price per tonne improved to USD2,522 from USD2,082 per tonne.
Lead & precious metals revenue dropped, however, to USD14.0 million from USD14.5 million the year before, due to lower silver production.
Cost of sales of USD23.3 million in the first half of 2018 was higher compared to USD20.8 million in 2017, due to additional costs incurred when extracting ore from greater depth.
Administrative expenses also rose year-on-year to USD9.7 million from USD8.1 million.
"This is a wonderful result in light of the 21% fall in the zinc since the beginning of the year," said Chairman Mladen Ninkov. "The second half of the year will remain challenging if commodity prices remain subdued."
Shares in Griffin Mining were trading 13% lower on Tuesday at 124.00 pence each.
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