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LONDON (Alliance News) - Metals Exploration PLC on Friday reported a widened pretax loss in the six months ended June 30 after incurring a heavy fair value loss on forward sales contracts.
The exploration company said its pretax loss for the first half was GBP16.3 million, compared to the GBP1.3 million loss posted a year earlier, though the company made no revenue either year.
Metals Exploration said it had completed a number of gold pours since its first pour from its Runruno project in July but had made no gold sales due to limitations on the sale of commercial products during the test run phase.
Metals Exploration declared the start of commercial production on September 9.
Metals Exploration noted the GBP11.4 million fair value loss it made on forward sales contracts during the period, having made a GBP1.8 million gain a year earlier.
This relates to the hedging arrangements Metals Exploration's subsidiary FCF Minerals Corp entered into with the two banks with which it has a debt facility HSBC Ltd and BNP Paribas: an interest rate hedge for approximately 40% of the interest exposure; and a gold forward sales programme representing a total of 90,000 ounces of gold. 45,000 ounces of forward sales contracts remain open, the company said.
Shares in Metals Exploration were down 4.8% at 5.95 pence on Friday.
By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland
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