LONDON (Alliance News) - Amara Mining PLC Tuesday said it swung to a pretax loss in 2013 as a drop in revenues due to lower production and a fall in gold prices, along with significant impairment charges hit the company.
The Africa-based gold mining company, with operations in Burkina Faso, Ivory Coast and Sierra Leone, posted a pretax loss of USD52.0 million compared with a USD8.5 million pretax profit the previous year as revenues fell 43% to USD52.4 million from USD91.3 million.
The company said its revenues fell due to a 29% fall in gold sold in the year along with a 20% fall in the average gold price.
Amara mining also noted impairment charges of USD30.4 million as the company's Burkina Faso assets were hit by a range of increased costs and reductions in value and mine life due to the gold price drop.
In January, the company said it had achieved a full-year production of 42,348 ounces of gold from the Kalsaka/Sega Gold Mine in Burkino Faso compared from 53,544 ounces at the Kalsaka mine in the previous year before trucking from Sega Gold project began midway through 2013.
As such the company did not achieve its original 50,000 to 60,000 ounces of gold production guidance for 2013 but surpassed its revised number of 40,000 ounces, which the company announced in November after a delay in production from Sega.
On Tuesday, Amara reiterated its 2014 production guidance from Kalsaka/Sega at 60,000 to 70,000 ounces as the average grade of material from Sega is expected to continue rising.
The company continues to expect that production will end from Kalsaka/Sega in the first quarter 2015 and is currently fully funded to the point of delivering a pre-feasibility study for its Yaoure site in Ivory Coast in the same quarter, following a placing to raise GBP18.2 million and an open offer to raise GBP300,00 earlier this year.
Amara's Preliminary Economic Assessment of the Yaoure Gold Project has shown compelling returns, including a 32% Internal Rate of Return and a USD688 million Net Present Value at a gold price of USD1,250 and a discount rate of 8%.
The company also updated its mineral resource at Yaoure during 2013 to 6.3 million ounces, growing Amara's total resources to 10.1 million ounces.
Amara Mining shares were down 0.8% to 16.50 pence in early trading Tuesday.
By Tom McIvor; tommcivor@alliancenews.com; @TomMcIvor1
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