Strong gold production in the final quarter of 2016 saw Acacia Mining PLC (LON:ACA) post forecast-beating full-year production results.
For the three months to December, gold production increased to 212,954oz – 12% up compared to the same period last year.
The strong finish helped to push up full-year production of the yellow metal to 829,705oz – a 12% increase on 2015’s figures.
That was ahead of analysts’ expectations of around 823,000oz, and significantly up on original guidance of between 750,000oz and 780,000oz.
It sold on 816,000oz of the precious metal throughout the year, up more than 11% compared to 2015.
One of the biggest differences was the price of gold, which rallied throughout much of last year, with the average realised price in 2016 of US$1,240 an ounce, considerably higher than the US$1,154/oz it received a year earlier.
Importantly, all in sustaining costs (AISC) for the year came in at US$958/oz, towards the bottom end of the original US$950 to US$980 target range. Yuen Low at Shore Capital said he was hoping for that figure to, at worst, stay the same throughout 2017.
With the much improved AISC, Acacia was able to add to its cash reserves, which totalled US$318mln come the turn of January (2015: US$233mln).
Net cash at the end of the period came in at US$219mln (2015: US$115mln), although this was below City broker Panmure’s forecast of US$240mln.
There was no update on the possible merger with Endeavour Mining (TSE:EDV).
The two parties have held preliminary discussions about a deal that would create a £3bn Africa-focused gold miner.
Shares were down almost 5% to 410.7p.