Acacia Mining Net Profit Drops But Output Target Reaffirmed

By Alex MacDonald

LONDON--Tanzania's largest gold miner Acacia Mining PLC (ACA.LN) said Thursday that net profit fell 60% in the first quarter due to delayed gold sales and higher costs but reaffirmed that it remains on track to produce more gold this year.

The U.K.-listed miner, previously known as African Barrick Gold, posted a net profit of $9.2 million for the three months ended March 31 compared with $22.4 million in the same period a year earlier.

Revenue slipped 0.6% to $215 million during the period as a 7% rise in gold sales volume to 171,415 ounces was more than offset by a 7% drop in the achieved gold price in the first quarter compared with the same period a year earlier.

Gold output rose 8% to 181,660 ounces during the period, buoyed by higher output from Acacia's North Mara and Bulyanhulu mines but gold sales were 6% below production due to the timing of concentrate sales.

Cash costs rose 3.6% to $783 an ounce in the first quarter compared with the same period a year earlier mainly due to the impact of increased maintenance and contracted services costs at Bulyanhulu and waste movement related costs at Buzwagi.

Chief Executive Officer Brad Gordon said the company remained on track to produce 750,000 to 800,000 ounces of gold this year at a reduced all-in sustaining cash cost of $1,050/oz to $1,100/oz.

Acacia Mining, which is 63.9% owned by Barrick Gold Corp. (ABX), produced 718,651 ounces of gold last year, up 13% on year, at an all-in sustaining cash cost of $1,105 per ounce of gold.

Write to Alex MacDonald at [e-mail]