Minera unveils fall in gold production, sales and profits

Shares in Latin American gold mining company Minera IRL plunged Tuesday after reporting a fall in sales and production in the first quarter.

Shares in Latin American gold mining company Minera IRL plunged Tuesday after reporting a fall in sales and production in the first quarter.

Gold sales fell 13% to 5,660 ounces compared to a year earlier, reflecting a 13% drop in production to 5,848 at the Corihuarmi mine in Peru due to lower grade ore.

Revenue declined 17% to $9.2m and profit before tax plummeted 94% to $0.2m as the average price of gold fell 4.0% to $1,631 per ounce.

The company posted a 57% decrease in earnings before interest, tax, depreciation and amortisation (EBITDA) of $1.9m.

Loss after tax came to $1.1m, compared to a profit of $1.7m the prior year.

Chairman Courtney Chamberlain said the results were in line with the group's expectations.

"Corihuarmi has now been in production for over five years and an outstanding success," he said.

"Production is now declining with the mining and treatment of lower grade ore but the mine continues to generate strong cash flow."

During the quarter, the company raised $15.5m in equity for the exploration of the Ollachea mine in Peru.

The business has so far completed a first phase underground drill programme on the eastern extension of the Minipampa resource zone which wielded strong results.

"The focus is now on obtaining the development permit during the second half and, in parallel, arranging of project finance," Chamberlin added.

Minera ended the period with a cash balance of $6.5m, up from $6.2m at the end of the previous quarter.

Shares tumbled 16.33% to 20.50p at 11:36 Tuesday.

RD

Recommended

Share tips of the week – 21 January
Share tips

Share tips of the week – 21 January

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
21 Jan 2022
Seven cheap defence stocks to buy now
Share tips

Seven cheap defence stocks to buy now

We’ve got used to a world without war between major powers, but that era is coming to an end as Russia threatens Ukraine and China eyes Taiwan. Buy de…
21 Jan 2022
Invest in VCTs: tax-free investments set to break records
Investment strategy

Invest in VCTs: tax-free investments set to break records

Generous tax breaks make VCTs – venture capital funds – an attractive supplement to pensions.
21 Jan 2022
HubSpot: a tech stock set to tumble
Trading

HubSpot: a tech stock set to tumble

US tech stocks have had a fantastic couple of years. But this year is unlikely to be so bullish for high-fliers that can’t turn big profits.
18 Jan 2022

Most Popular

Ask for a pay rise – everyone else is
Inflation

Ask for a pay rise – everyone else is

As inflation bites and the labour market remains tight, many of the nation's employees are asking for a pay rise. Merryn Somerset Webb explains why yo…
17 Jan 2022
Temple Bar’s Ian Lance and Nick Purves: the essence of value investing
Investment strategy

Temple Bar’s Ian Lance and Nick Purves: the essence of value investing

Ian Lance and Nick Purves of the Temple Bar investment trust explain the essence of “value investing” – buying something for less than its intrinsic v…
14 Jan 2022
Interest rates might rise faster than expected – what does that mean for your money?
Global Economy

Interest rates might rise faster than expected – what does that mean for your money?

The idea that the US Federal Reserve could raise interest rates much earlier than anticipated has upset the markets. John Stepek explains why, and wha…
6 Jan 2022