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Randgold Resources slides on lower 1Q earnings due to impact of strikes

Published: 13:10 10 May 2018 BST

exterior of gold mine
Mine in Democratic Republic of Congo is now fully commissioned and on track to achieve 2018 target

Randgold Resources Ltd. (NASDAQ:GOLD) saw its shares slide after it reported lower first-quarter earnings due in part to the impact of strikes at its Tongon mine in Ivory Coast,  though the gold miner said its 2018 production guidance remains intact.

The stock of Randgold was down around 7.5% in early trading, at US$76.13 a share.

Randgold said its first-quarter profit fell to US$66.5mln, which was down 24% from the previous quarter and down 22% from levels of the first quarter of 2017.

Production in the first quarter dropped 16% to 286,890 ounces from 340,958 ounces in the fourth quarter of 2017 due in part to the effects of the strikes, while the total cash cost per ounce of gold rose 15% to US$720 in the first quarter from US$627 in the previous quarter.

In a positive development, Randgold said the full commissioning of its Kibali underground mine in the Democratic Republic of Congo allowed the company to increase quarterly production from the mine by 22% compared to the first quarter of 2017. Randgold said the mine is on track to achieve its 2018 target of 730,000 ounces.

Randgold CEO Mark Bristow said after coming off a strong prior quarter and record performance in 2017 the company had anticipated a slower start to 2018 with a gradual build-up throughout the year. 

"Despite the issues that arose," the company said, "it was still confident of meeting its annual production guidance of 1.30mln to 1.35mln ounces."

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