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Alliance News

Eurasia Mining Revenue Multiplies But Loss Widens On Forex Movements

Wed, 15th May 2019 13:58

LONDON (Alliance News) - Eurasia Mining PLC on Wednesday said its revenue was 14 times higher in 2018 than 2017 after the first full season of mining from its West Kytlim but its loss widened due to negative foreign exchange rate movements.

The mining company posted revenue of GBP2.6 million for 2018, many times its GBP183,998 revenue in 2017, as production at the West Kytlim platinum group metals and gold mine in Russia began in May 2018 and continued through to November.

Despite this sizeable up-tick in revenue, the company made a pretax loss of GBP3.2 million in the year, widening 52% from GBP2.1 the year before.

This was caused by a much higher foreign exchange loss - GBP903,427 in 2018 versus GBP169,062 in 2017- from the revaluation of loans and the high volatility of the Russian Rouble. The company also recorded a GBP450,936 impairment of investments in 2018, having recorded no such impairment in 2017.

The company has two major Russian operations, which are West Kytlim and the Monchetundra polymetallic project. The mining licence for Monchetundra was issued in December 2018, which Eurasia Mining feels could be "transformational for the company".

"As a standalone unit the mine at West Kytlim demonstrated excellent profit margins during 2018 and contributed to the gross profit at group level. The economics of this style of operation - with limited overheads and capital expenditure are assured, however expanding the mine at West Kytlim to multiple operating sites is now a key objective for the company," said Eurasia Mining Executive Chair Christian Schaffalitzky.

"The directors look forward to continued successful production at West Kytlim and believe the company can grow its West Kytlim operation to become the largest alluvial platinum mine globally. The directors believe West Kytlim mine cash flows...are now sufficient to make significant contributions to the running of the company at group level," Schaffalitzky added.

Shares in Eurasia Mining were up 2.1% at 0.57 pence early on Wednesday afternoon.

By Anna Farley;

Copyright 2019 Alliance News Limited. All Rights Reserved.

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