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.
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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.
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