LONDON (Alliance News) - Acacia Mining PLC benefited from a rise in gold prices during the first quarter with revenue up by 6% despite a ban on gold and copper concentrate exports in Tanzania.
A 6.2% increase in realised gold prices over the quarter offset the impact of lower revenue from gold and copper concentrate sales. The FTSE 250 company reported that in the first quarter that ended March 31 it generated revenue of USD233.9 million, an increase of 5.9% from USD220.9 million the previous year.
During the first quarter, Acacia Mining said its average realised gold price rose to USD1,221 per ounce from USD1,150 in the first quarter of 2016.
Brad Gordon, Acacia's chief executive officer, said that the company was still discussing with the Tanzanian government the resumption of exports of gold and copper concentrate. Such exports have been blocked since March 3 and normally account for around 30% of the company's revenue. Gordon added that whilst talks continue ,the company will stockpile production in Tanzania, meaning that at this stage "there is no change to guidance for the year".
Tanzania stopped the exports last month to keep processing activities within the country. Acacia said in March that it was considering bringing processing operations into Tanzania and was assessing "the economic potential of building of a smelter in Tanzania capable of processing our concentrate" due to the ban.
It added in its first quarter results Thursday that it will reassess the ongoing operation of the Bulyanhulu and Buzwagi mines in the coming weeks.
Acacia's gold production was 15% higher during the first quarter to 219,670 ounces from 190,210 ounces in 2016. The company said that its gold sales remained flat, however, due to the export ban. The company reported pretax profit of USD46.0 million in the quarter, up from USD27.7 million over the same period last year.
Shares were down 4.0% to 437.50 pence on Thursday.
By Tom Rees; firstname.lastname@example.org
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