Freda Rebecca revenue decline 36%

Published: 11 December 2013

Freda Rebecca gold mine's revenue for the six months to September declined 36% to $43.6 million from $59.7 million after mine production declined 11.2% to 32,252oz of gold compared to 36,335oz produced in September 2012. Average monthly production was 5,375oz of gold.

The decrease in gold produced was attributable to disruption due to the leach tank incident, lower grade and lower recoveries, which were partially offset by an increase in milled tonnage.

Profit before tax fell to $9,1m compared to $24,3m in the September 2012. The fall is profits is attributable to lower head grade and recoveries and a lower gold price. Recoveries suffered due to the leach tank incident, falling to 81% for the six months to September 2013 (30 September 2012: 82%).

According to unaudited results for the interim period published by parent company Mwana Africa, Freda Rebecca gold mine, having restarted operations in 2009, produced 65,350ozs of gold in the 12 months to March 2013.

"Production levels at Freda Rebecca recovered during this financial period from the leach tank incident that occurred at the end of the last financial year. Leach tank repairs were completed at Freda Rebecca in the period," said the statement.

Cash costs rose to $887/oz compared to $797/oz in September 2012 and all in sustaining costs rose to $1,098/oz compared to $993/oz in September 2012.

The average gold price achieved by Freda Rebecca for the six month period to September 2012 was $1,642/oz compared to $1,352/oz for this six month period.

Management said, "Operations at the Freda Rebecca Gold Mine stabilised during the period following the leach tank incident in the March 2013 quarter. Whilst recoveries initially suffered in the June 2013 quarter dropping to 78%, the September 2013 quarter saw them rise back above 80% to 84%. Freda Rebecca produced 32,252ozs for the period at a C1 cost of $887 per ounce and achieved revenue of $43.6m (30 September 2012: $59.6m)."

Kalaa Mpinga, Chief Executive Officer of Mwana Africa, said: "Despite the difficulties brought on by lower commodity prices, the Company has achieved considerable progress on all of its main projects. Significantly, in Freda Rebecca and Trojan, we now have two mines in production, and our resource base in gold and nickel, together with the copper potential under our Joint Venture with Hailiang underpins a promising future for Mwana."
- businessdaily