(Alliance News) - Russian gold miner Highland Gold Mining Ltd on Tuesday saw a drop in production in the first half of 2020 but came out on top with an 11% increase in revenue thanks soaring gold prices.
The company posted a pretax profit for the six months ended June 30 of USD69.0 million, widening from USD56.1 million a year prior.
Revenue was up 11% to USD194.5 million from USD174.7 million the year before.
Gold production was down in the half to 124.43 million ounces from 142.3 million ounces a year prior.
Highland Gold said that despite the lower sales volumes, its increase in revenue was achieved due to higher realised prices for gold and gold equivalent.
Chief Executive Denis Alexandrov said: "Highland Gold had a positive first half of 2020 despite the ongoing global pandemic, buoyed by strong gold prices and continued progress at our operating mines and on each of our key development goals for the year. The company achieved a solid financial performance in spite of upward pressure on costs resulting, in part, from lower first half production volumes and costs associated with addressing Covid-19."
The company said that Covid-related care and maintenance costs in the first half amounted to USD2.1 million.
The company has deferred making a decision on the payment of an interim dividend. This decision is pending the outcome of the sale of 40% of the company's share capital by Directors Euhene Shvidler and Velery Oyf to Fortiana Holdings Ltd, announced on July 31.
Going forward, the company is expecting to ramp up its operations in the second half.
Alexandrov said: "From an operational standpoint, our mining plans for this year are weighted towards the second half and we maintain our production guidance for the year. The Novo and Belaya Gora expansion projects are progressing and remain on track for completion this year. Construction at Kekura continues apace, and work has also begun on the smaller Baley ZIF-1 heap leach project, which together will help the company achieve its target of exceeding 500,000 ounces of production in the year 2023."
Shares were down 0.3% at 295.00 pence each on Tuesday morning in London.
By Greg Roxburgh; email@example.com
Copyright 2020 Alliance News Limited. All Rights Reserved.