JUGGLER16 May 2011 10:59
Griffin Mining substantially improved its fortunes in 2010, despite suspending operations from August following two fatalities. Production of zinc concentrate fell just short of 2008’s record of 22,922 tonnes and was significantly up on 2009.
Griffin processed 389,496 tonnes of ore in 2010, an increase of more than 40% on 2009, and upgraded processing facilities should enable significantly more throughput to be processed in future. A 90% increase in gold production to a record 7,067 oz, and a 77% increase in sliver output helped boot pre-tax profit by 55% to $11.2m (£6.8m).
At 60p, the shares remain well below our long-standing buy advice (105p, 31 Aug 2007). But operations have improved and have the potential to grow further, and the global zinc market is forecasted to tighten beyond next year. Buy.