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Anglo Asian Mining profits grow on higher revenue as production ramps up

Anglo Asian declared an interim dividend of 3.50 US cents after ending the first half in a stronger net cash position

Anglo Asian Mining PLC -

Anglo Asian Mining PLC (LON:AAZ) said it is on course to meet its production target for the year after a strong first half of output.

The Azerbaijan-focused miner achieved total production of 39,905 gold equivalent ounces (GEO) in the six months to 30 June, compared to 37,349 GEO in the year-ago period.

WATCH: Anglo Asian Mining on course to meet full year production target after strong first half

The growth in first-half production resulted in an 8% rise in revenue to US$43.3mln and an 27% jump in pre-tax profit to US$10.3mln.

All-in sustaining cost of gold production came to US$603 per ounce, compared to US$543 per ounce last year, due to an extra US$2.7mln cash costs of mining a higher volume of ore.

Anglo Asian said some of the additional ore mined has been stockpiled for use in 2020, which will reduce costs next year.

For the 2019 financial year, the company expects output of between 82,000 and 86,000 GEOs based on metal prices as of 1 January.

“However, the increase in the price of gold and decrease in the price of copper since 1 January 2019 have resulted in one tonne of copper decreasing in value from approximately 4.7 to 3.8 GEOs,” said non-executive chairman Khosrow Zamani.

“We are on track to achieve our initial production target, but when translated into GEOs at actual metal prices, the FY 2019 forecast outcome is now around the bottom end of the guidance range.”

Nevertheless, Zamani said the company remains in an “enviable position to continue its progression and deliver on its stated growth strategy”.

An interim dividend of 3.50 US cents per ordinary share will be paid to shareholders on 31 October, which the company said reflects a “strong cash position and low level of debt”.

As of 30 June, Anglo Asian had cash of US$20.4mln and debt of US$5.2mln, bringing it to a net cash position of US$15.2mln, compared to US$6.1mln at the end of December.

Quick facts: Anglo Asian Mining PLC

Price: 137 GBX

AIM:AAZ
Market: AIM
Market Cap: £156.72 m
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