Hochschild Mining stung by silver price drop

South America focused silver and gold miner, Hochschild Mining, has seen revenues drop markedly, while also reporting delays in winning environmental approval for new Peruvian mines.

A 14% reduction in the price of silver saw total revenues fall to $354.5m in the first six months, against the $496.8m seen at the same point in 2011.

Profits before tax came in at $92.26m, while the actual profit figure Hochschild prefers (profits from continuing operations) was $52.76m, a 65% decline on the prior year.

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Attributable silver production fell 6% to 6.887m ounces, gold was down 12% at 55,940 ounces. After exceptional costs earnings per share fell 72% to just 0.08 cents.

The interim dividend has been kept at 0.03 cents per share.

Hochschild had already told the market that it would like to develop sites at Inmaculada and Crespo but warned on Wednesday that: "the increasingly complex permit approval process in Peru could potentially create some uncertainty on the precise timing for receiving the final construction permits."

Commenting on the results the Executive Chairman, Eduardo Hochschild, said:

"The first half of 2012 provided the company with tougher challenges than last year, although I am pleased to report that we have delivered on our production targets and that we are on track to meet our full year target."

BS