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Orosur Mining (LON:OMI TSX:OMI) has upped its cash holdings despite lower production and gold price hitting revenues.
The Uruguay-based gold miner produced 12,471oz in the three months to August compared to 13,684oz a year ago.
Cash operating costs rose to US$954/oz from US$945/oz with all All-In-Sustaining costs of US$1,166/oz (US$1,182/oz).
The company, which operates the San Gregorio mine in the Uruguay, received US$1,147/oz per ounce on average compared with US$1,302/oz.
Reflecting that, revenues dropped to US$14.5mln (US$16.5mln), while net losses rose to US$1.74mln from US$710,000. Net cash increased slightly to US$3.5mln.
Ignacio Salazar, chief executive, said: "Despite continuing to operate in a low gold price environment, we managed to slightly increase our net cash balance during the quarter whilst again delivering in line with our production and cost guidance.
"The company has also been implementing changes in mine planning, cost structures and capital spending in a process that has involved multiple interested parties representing government, community and trade unions.
"These efforts are in addition to cost reduction measures across all areas of the business, including a 40% reduction in staff since the beginning of the fiscal year, as the company remains focused on reducing its AISC to below US$1,000/oz for the remainder of the fiscal year.
“In Chile, we are pleased to report the completion of the geophysics program in Anillo and the approval to advance with the 3,600m of RC drilling commencing in November.”
House broker Cantor added that Orosur looks on target to meet its targets in the current year of 30koz - 35koz gold at an AISC cost of US$1,000/oz – US$1,100/oz.
In addition, the permitting process for the proposed San Gregorio Deeps mine is continuing, drilling of the down dip extension to Arenal Deeps is being prepared, and OMI received the first US$850,000 tranche of funding from Asset Chile for ongoing work at the Anillo project.
The target price is 22p. Shares today rose 9% to 6.25p.