Serabi Gold third quarter revenue almost doubles

Brazil-focused gold mining and development company Serabi Gold reported record gold production for the third quarter of 2016, and cash costs of production for the year to date of $772 per ounce on Monday.

The AIM and TSX traded firm reported revenue of $16.21m for the three months to 30 September, almost double the $8.37m posted at the same time last year, with the cost of sales reaching $10.22m compared to $6.30m.

Its gross profit for the quarter was $3.09m, up from $1.20m, with profit before tax at $0.74m, up significantly from $0.11m.

Basic earnings per ordinary share were 0.11 cents, compared with 0.02 cents, and the average gold price received was $1,256, up from the $1,156 reported a year ago.

Gold production was reported as 29,900 ounces for the first nine months of the year, up from 22,270 ounces.

The company’s all-in sustaining costs were $951 per ounce, more than the $894 at the same point last year.

“The third quarter has produced another satisfying result, both operationally and financially,” said CFO Clive Line.

“Gold production of 10,233 ounces was another successive record quarter being a three per cent improvement on the preceding quarter.

“Record levels of mined and milled tonnages were also achieved in the quarter.”

Line said whilst Serabi’s costs, in local currency terms, continued to be relatively steady, the Brazilian economy and therefore the Brazilian real have continued to benefit from high inward investment flows, supplemented by tax inflows from previously undeclared foreign income and investment holdings that have been stimulated by a short-term amnesty.

“These inward flows have continued to support the currency, though with the amnesty coming to an end, there has been some recent weakening.

“We continue to evaluate all opportunities to improve our cost base and improve gold recovery to maintain and improve margins.”