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THE reopening of Bindura Nickel Corporation’s Trojan mine in April offset lower revenue from the Freda Rebecca Gold Mine, the group said in its financial statement for the six months ending September 30, 2013.
Mwana Africa generated a seven percent higher group revenue to $65 million for the interim period under review, compared to $60,7 million during the first half in 2012.
Revenue from one of the group’s operations, Freda Rebecca in Zimbabwe, fell from $59,7 million, generated by the sale of 36,335 ounces of gold in the first half last year to $43,6 million from the sale of 32,252 ounces during the six months to September 2013.
Bindura Nickel Corporation (BNC) generated $21,4 million in revenue from the sale of 2,191 tonnes of nickel in concentrate during the half-year to September, increasing from the $1 million reported in the prior corresponding period.
Mwana Africa chief executive officer Kalaa Mpinga said: “The group is thus already enjoying the benefit of having BNC back in production and having two producing mines in its portfolio.”
However, he said the average gold price achieved by Freda Rebecca for the six-month period under review was $1,352 per ounce, a cut from the $1,642 per ounce achieved in the prior corresponding period.
Nickel prices also fell with BNC achieving an average nickel price of $14,268 a tonne for the six months to September 2013, compared with the high of $18,000 a tonne in January this year.
“The fall in gold and nickel prices earlier in the year resulted in a difficult period for Mwana,” said Mpinga, adding that the company moved to cut costs while suspending exploration drilling at the group’s Zani Kodo project in the Democratic Republic of Congo. We reacted swiftly to the challenge, starting a corporate cost-cutting exercise and raising about $6 million to resolve the immediate working capital shortfall. Mwana is now stable and we are focused on delivering value from all of our projects,” he said.
The Aim-listed group posted 88 percent higher profit after tax during the six months to September, reaching $7,5 million, compared with the $4 million achieved in the prior period.
However, basic earnings a share during the interim period fell to 0,45 cents from 0,75 cents during the six months to September last year. Operating costs rose from $49,6 million in the first half of last year to $55,9 million during the six month period under review, owing to the BNC restart.
Mwana ended the interim period with a cash balance of $9,2 million.
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