Gold miner Centamin (CEY) gained 2% this morning to 135p as it revealed it is in pretty good shape despite the coronavirus outbreak.
The FTSE 250 miner operates the Sukari mine, located in Egypt, one of the largest gold deposits in the world.
As of yesterday Egypt, the Arab world’s most populous country with a population of around 100m, had 366 confirmed cases of the coronavirus and reported 19 deaths.
Centamin has delayed publishing its full-year results in line with the Financial Conduct Authority moratorium on the publication of financial statements.
But in an update, the company said none of its workers had tested positive for the virus and that it has experienced ‘no material disruption’ to its operations, supply chain or gold shipments.
It added that ‘early action’ was taken at Sukari to stop non-essential travel, adjust and manage on-site rosters and enable employees to work from home where possible.
It has provided appropriate information to the workforce on the virus’ symptoms and preventative measures, banned non-essential visitors, established mandatory checkpoints for possible symptoms, and travel history screening for all visitors.
'BETTER PLACED THAN OTHERS TO WEATHER VIRUS'
The company said it is a ‘strong, resilient business’ with no debt and $348.9m in cash and liquid assets as at 31 December 2019.
This was echoed by Shore Capital analyst Yuen Low, who added, ‘We note also that as of June 2019, the company had $413.7m of current assets, versus just $55.4m of current liabilities.
‘In our view, such balance sheet strength means the company is better placed than many miners to weather COVID-19.’
NO SUPPLY DISRUPTIONS
While Egypt has closed its borders to civilian travel until at least 15 April, they remain open for goods and supplies.
To date, Centamin said it has experienced no supply disruptions and has ‘sufficient internationally sourced critical supplies stockpiled for the next quarter.’
It added that it is maintaining ‘open dialogue with our key international and domestic suppliers and, as a matter of caution, have assessed alternative potential supply channels.’
Centamin’s existing production guidance for 2020 was for between 510,000 and 540,000 ounces of gold, weighted around 60% to the second half of this year, at an all-in sustaining cost of $870 to $920 per ounce of gold sold.