LONDON (Alliance News) - Condor Gold PLC on Wednesday reiterated that putting a 'For Sale' sign on the business could be its best option.
Earlier this month, Condor Gold initiated a formal strategic review of its business and assets, with the company considering options including a full sale, joint ventures or asset disposals.
"In the last three years the company has operated in a chronic bear market. The gold price is down 41% from its all-time high, and the NYSE ARCA Gold Bugs Index, which represents junior gold companies, is down 72%. Investors have sold shares across the full spectrum of gold companies, irrespective of the fundamentals," Mark Child, executive chairman and chief executive, said in a statement.
"Condor's share price has suffered accordingly even though La India Project, in the board's view, is one of the most attractive resource/reserves due to the high average grade of 4.0 grammes per tonne gold, low all in sustaining cash costs of under USD700 per ounce gold, low upfront capital costs, 100% ownership of the concessions and mining friendly jurisdiction," Child said.
"One of the options being considered would be a possible offer for the company," Child added, listing asset sales or a joint venture as other potential moves.
The company reported a GBP1.5 million pretax loss in the six months to June 30, compared with the GBP1.6 million reported for the corresponding period the prior year. Child said the company's GBP2.4 million cash position at the end of June is enough to fund its current strategy, under which it wants to continue to show the "significant exploration upside" of La India project through geological mapping, soil geochemistry surveys and the production of a detailed structural model.
"The commissioning of Whittle Consulting to run its Enterprise Optimisation Software on the existing resources/reserves and technical studies used in the PFS and PEAs should be announced shortly. The strategy of securing the rural land, applying for an EIA permit and implementing the IFC performance standards will all materially de-risk the Project and pave the way for Mina La India to become the next large commercial mine in Nicaragua. Drilling is postponed until market conditions improve. The local employee payroll has recently been cut by 30% and the board of directors has accepted reduced remuneration," Child said.
Condor Gold shares were up 2.8% at 55.0 pence on Wednesday morning.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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Condor Gold (CNR)