Azerbaijan-focused Anglo Asian Mining swung into the black in the six months to the end of June following record copper and silver output.
The group reports a profit before taxation of $3.5 million against a loss of $4.1 million last time.
Revenue decreased to $39.3 million (H1 2015: $41.8 million) due to lower gold bullion sales partly offset by higher sales of copper concentrate
- 26% reduction in average cash operating costs to $546 (H1 2015: $736) per ounce of gold bullion due to both lower mining and processing costs and higher by-product sales
- Increased operating cash flow before movements in working capital of $16.9 million (H1 2015: $10.7 million)
- Reduced capital expenditure of $6.6 million (H1 2015: $9.1 million) - expenditure mainly on advanced stripping, the new SAG mill and underground equipment
- Decreased net debt of $40.7 million as at 30 June 2016 (31 December 2015: $49.0 million)
Production and sales overview:
- Strong H1 2016 production figures with increasing copper and silver production:
* Record copper production of 969 tonnes (H1 2015: 418 tonnes)
* Record silver production of 90,782 ounces (H1 2015: 6,478 ounces)
* Gold production slightly reduced at 33,837 ounces (H1 2015: 35,938 ounces)
- Increased copper concentrate sales which have partially offset reduced gold bullion sales:
* Copper concentrate sales of 2,912 dry metric tonnes ("dmt") which generated revenue of $5.2 million (H1 2015: 606 dmt which generated revenue of $1.7 million)
* Gold bullion sales of 27,719 ounces at an average of $1,230 per ounce (H1 2015: 33,294 ounces at an average of $1,204 per ounce)
- 18,000 ounces of gold bullion sales in H2 2016 hedged at no cost with a minimum and maximum sales price per ounce of $1,200 and $1,426 respectively
- Target gold production for the year to 31 December 2016 lowered to between 69,000 and 71,000 ounces of gold. Target copper production remains at between 1,700 and 2,100 tonnes of copper
Non-executive chairman Khosrow Zamani said: "I am delighted to report a return to profitability at Anglo Asian with the Company earning a profit before taxation in the six months to 30 June 2016 of $3.5 million. This return to profitability, together with the reduction in capital expenditure and net debt, demonstrates the progress of our strategy at Gedabek. The Company has now created a foundation for increased profitability and cash generation."