Lower grades knocked revenues at Xtract Resources’ (LON:XTR) Chepica gold mine in the three months to end December despite a rise in the amount of ore processed.
Revenue was 16% below the previous quarter at US$375,000, though costs dipped by 44% to US$168,000, which helped profits rise by 39% to US$208,000.
Mill grades were 40% lower than expected at 1.65 g/t and 8% below the previous three months.
Xtract has now halted processing at Chepica after two employees died at the plant in an accident before Christmas and it is awaiting Chile’s mine inspectorate approval to re-start.
Jan Nelson, Xtract’s chief executive, said: "The main challenge at Chepica has been delivering the planned volumes, which has proved challenging as a direct result of the lack of flexibility due to having only one access point.
“We now have five ends on reef at Colin with the mine's new adit at Chepica on target to expose another two reef ends during Q2 2016, compared to only one reef end at present.”
Nelson added rougher cells are being installed to address the mill grade problem.
“This gold is not lost and we expect to recover it in Q2 and Q3 2016."
Shares eased 7% to 0.2p.