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LONDON (Alliance News) - Anglo Asian Mining PLC on Wednesday said sales and production of gold in the first quarter of 2016 were both lower than any quarter throughout the whole of 2015, but said it expects to deliver at least a small amount of growth during the full year.
The miner operating within Azerbaijan said gold production amounted to 14,172 ounces of gold in the first quarter of 2016. That production was comprised of 13,383 ounces contained within gold dore, 777 ounces from the flotation plant and 12 ounces from the SART processing facility.
That gold dore production was at least 22% lower than any quarter in 2015 when quarterly production varied between 17,185 to 18,739 ounces per quarter.
"Gold dore production lower than fourth quarter of 2015 due to harder ore with lower grades encountered and severe winter weather. Second SAG mill for the agitation leach plant now contracted for and expected to begin operation in the third quarter of 2016. This will increase amount of ore that can be processed to offset slower milling of harder ore," Anglo Asian said.
Gold sales totalled 12,058 ounces in the first quarter of 2016, which also was at least 19% lower than any quarter in 2015 when sales varied between 14,871 to 17,206 ounces per quarter.
However, gold prices have strengthened for Anglo Asian since the start of 2016, averaging USD1,184 per ounce in the first three months of 2016. That is higher than the average gold price achieved in the second half of 2015, but still lower than a year ago when prices averaged USD1,214 per ounce.
Silver production in the first quarter totalled 34,342 ounces, which was a huge rise from the 17,710 ounces produced n the final quarter of 2015. Copper production also rose to 432 tonnes from only 335 tonnes in the previous quarter.
Copper sales in the first quarter totalled 1,330 dry metric tonnes of concentrate, generating a total of USD2.1 million in sales. That can be compared to the 817 tonnes sold in the final quarter of 2015 which generated total sales of USD1.3 million.
Anglo Asian published its full-year guidance for the year, as the miner aims to produce between 73,000 to 77,000 ounces of gold and between 1,700 to 2,100 tonnes of copper.
Gold production in 2015 rose 19% year-on-year to 72,032 ounces whilst copper production increased by 24% to 969 tonnes. That means Anglo Asian is expecting gold production to rise by around 1.3% to 6.9% this year whilst copper production is expected to rise by at least 75%.
Based on the 14,172 ounces of gold produced in the first quarter, Anglo Asian would only be able to produce 56,700 ounces in 2016. However, the miner is expecting the flotation plant to contribute around 4,000 to 5,000 ounces this year after contributing those initial 777 ounces in the first quarter of 2016, its first full three-month period of production.
The copper produced in the first quarter of the year suggests Anglo Asian is currently on track to deliver the bottom-end of its full year guidance.
Net debt at the end of March stood at USD47.5 million compared to the USD49.2 million at the end of 2015.
Anglo Asian shares were trading down 13% to 5.35 pence per share on Wednesday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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