logo-loader

Vast Resources moves into the black

Published: 08:24 20 Dec 2016 GMT

Upward chart trend on dollar background
There was a 1,310% increase in revenue

Vast Resources PLC (LON:VAST) moved into the black on the back of a sharp rise in revenue in the first half of its financial year.

Profit before tax from continuing operations in the six months to the end of September clocked in at US$265,000, versus a loss of US$3.62mln in the same period of last year.

Revenue shot up to US$14.12mln from US$1.04mln, following the successful commissioning of Vast’s first two mining operations.

WATCH: Vast Resources CEO on why 2017 is set to be 'extremely active'

In Zimbabwe, the Pickstone-Peerless Gold Mine has continued to perform extremely well, the company said. 

Gold production is close to 20,000 troy ounces (oz) a year with a cash cost per oz of around US$700.

The operation is accumulating cash towards the cost of the sulphide plant that is currently under construction.

All being well, the sulphide plant should be up and running by the early part of the second half of next year.

The plan is to build up mining and processing to 40,000 tonnes per month at an average grade of around four grams per tonne gold.

Gold production is expected to increase to 4,000 oz per month from the current 1,600 oz, Vast said.

Cost per ounce produced is not expected to increase significantly, it added.

"Production at Pickstone-Peerless has consistently surpassed expectations, having reliably exceeded 20,000 tonnes of ore per month, and is now running at a steady state,” said Roy Pitchford, chief executive officer of Vast. 

In Romania, there was a 5.6% decrease from the preceding six month period in copper produced at the Manaila polymetallic mine.

The company worked hard during the reporting period to improve metal recoveries in tandem with drilling to convert the resources categorised under Russian standards to the more widely accepted JORC classification. 

The company said the work yielded important results, such as an improved copper concentrate, the delivery of a second revenue stream though a zinc concentrate, and a resource that has been enlarged some eight times, transforming the underperforming asset into a cash flow positive mining operation. 

Work is now underway to generate a third revenue stream through a gold/silver concentrate.

"Following the extension of the licence area and the publication of a maiden JORC Resource estimate, the life of the open pit has been considerably extended and we now have a robust platform to deliver a value accretive and profitable mining operation from Manaila over the long term,” Pitchford said.

"We continue to believe that Romania represents a significant opportunity for the company; by applying the lessons we have learnt at Manaila we believe that there are multiple additional new valuable prospects available to Vast and we continue to employ an opportunistic outlook when appraising new projects," Pitchford added.

The company has had its challenges with the legal process relating to the issue of the mining licence at Baita Plai but receives regular assurances from the Romanian authorities that the process is progressing.

“Looking ahead, there is no doubt in my mind that 2017 is set to be extremely active for Vast,” said chairman, Brian Moritz. 

“With two mines currently in production and identified expansion potential at both, near term production potential at the Faneata tailings dam, and additional growth opportunities identified in Romania, including the Baita Plai mine, Vast has established a valuable and strategic portfolio of mining assets,” Moritz said.

Shares in Vast surged 6.5% to 0.17p in the first half-hour of trading.

HANetf founder and co-CEO discusses shift to active management in ETF market

HANetf founder and co-CEO Hector McNeil tells Proactive's Stephen Gunnion about shifting trends in the exchange-traded fund (ETF) market in the United States, indicating a big move towards active management within ETFs. Despite the European market lagging behind the US by three to five years,...

13 hours, 58 minutes ago