Centamin lifts profit

Egypt-focused mining company Centamin said full year production increased by nearly a third and, while the year has produced operating challenges and higher costs, it is confident of increased production at its flagship Sukari Gold Mine.

Centamin posted EBITDA of US$233.3m for the period ended December 31st 2012, up 10% on the prior year. Full year production was 262,828 ounces, a 30% increase on 2011 and above guidance of 250,000 ounces.

Pre-tax profit rose to $198.6m during the year from $194m previously after exceptional items of $33m. Revenue increased to $426m from $340.5m before. Basic earnings per share rose 2% to 18.27 cents from the prior year.

Cash costs of production rose to $669 per ounce, equivalent to $530 per ounce compared to $556 per ounce in 2011 at subsidised fuel prices.

For 2013, the group is targeting project production of 320,000 ounces at a cash operating cost of $700 per ounce, at international fuel prices.

"2012 presented some operating environment challenges, however a solid second quarter and a record fourth quarter of production have shown that a substantially larger production profile is achievable for Sukari," the group said in a company statement.

"This potential for production growth combined with the group's reserves, a significant expansion programme, a solid financial position, and an experienced team means Centamin is well positioned for 2013."

Centamin said it remains debt-free and unhedged with cash, bullion on hand, gold sales receivable and financial assets of $219.4m as at December 31st 2012.

Centamin's capital expenditure programme for 2013 has two key focus areas; Completion of the Stage 4 plant expansion and the on-going development of the underground mine, it explained.

During the year Centamin was involved in two separate court cases related to the operation of the mine at Sukari.

"Every action is being taken to contest the decisions, including the making of formal legal appeals and, although their resolution may take some time, we remain confident that a satisfactory outcome will ultimately be achieved," Centamin said.

CJ