Anglo Asian Mining Plc (LON:AAZ) saw a substantial pick-up in production in its second quarter as it continues to improve and lower costs at its Azerbaijan operations.
And chief executive Reza Vaziri told investors: "The second half of the year has historically been our best performing half due to the seasonally better weather and our production will also benefit from the second SAG mill which is due to start operating next month."
Gold output from Gedabek rose to 19,665 ounces in the three months to end June, compared to 14,172 ounces in the first quarter this year.
Copper production came in at 537 tonnes versus 432 tonnes last quarter, while the miner produced 56,440 ounces of silver against 34,342 ounces in Q1.
It sold 15,661 ounces of gold in doré sales in the three months at an average price of $1,265 per ounce (Q1: 12,058 ounces at an average of $1,184 per ounce).
Copper concentrate shipments to the customer totalled 1,582 dry metric tonnes with a sales value of $3 million (Q1: 1,330 dmt with a sales value of $2.1 million).
The first half also saw a contract struck over purifying water from the tailings dam and a second contract was executed to build electrical sub-station and associated overhead power lines expected to be completed by end of 2016, and anticipated annual savings of $1.8 to $2.0 million from 2017 onward.
"The new underground equipment which is now in full time use at Gadir is also improving our productivity," the firm added as it continues to work towards returning to profitability."
The firm has also hedged around half of expected gold sales for the rest of the 2016 due to the recent strength in the gold price resulting from the uncertainty of the UK's EU referendum decision.
The minimum sale price per ounce will be US$1,200 and the maximum US$1,426 under the deal, which the firm called a "win win" transaction.
"This is the first time Anglo Asian has hedged gold sales and this transaction therefore marks another stage in the development of your company," it told investors.
Its targeted output for the full year remains at between 73,000 ounces and 77,000 ounces of gold and 1,700 to 2,100 tonnes of copper.
Net debt as at June 30 was US$40.8 million, a reduction of US$8.2 million since the end of 2015.
Broker Shore Capital noted the improved Q2 production, that full-year targets were maintained and that the higher gold price eased balance sheet concerns, but added that "investors should remain wary, we believe".
"The recent rise in the gold price has alleviated our concerns somewhat for the near term, but until the balance sheet has been properly sorted out, we believe that investors should remain wary in relation to the medium term," said analyst Yuen Low.
Shares gained 7.97% to 18.625p.
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