Centamin cuts gold production forecasts due to operational delays

Gold miner Centamin on Friday cut its annual production target as delays in planned operational improvements led to a 25% fall in third quarter output.

The company cut its 2018 production target to about 480,000 ounces from August estimates of 505,000-515,000 ounces.

Third-quarter production at its Sukari mine in Egypt fell to 117,720 ounces from 156,533 ounces year-on-year.

Analysts at RBC Capital Markets described the guidance downgrade, 15% below their forecasts, as "disappointing".

They added that with production rates improving in September, the 145koz forecast for the fourth quarter "would suggest that the operations are on track exiting the quarter".

RBC's team was also waiting for clarification on why the grades from the mine's underground operation remained so low through the quarter.

"This being the 3rd straight guidance downgrade questions are likely to continue at around Sukari. We continue to see compelling upside fundamentally from the investment case both around the medium-term outlook for gold and with better understanding of Cleopatra likely to emerge in the coming months, but this disappointment, again, will be unhelpful for the share price in the near term," they said.