Mining Journal > Finance > Most stocks up as metals prices and profits rise

Finance

Most main board miners showed gains this week as commodity prices increased and financial results reflected this year’s stronger markets.

On the main board, Randgold Resources plc was the only faller of note, shedding more than 4% after the West African gold producer cut 5% off its original 2010 production guidance.

CIS miners, Ferrexpo plc and Eurasian Natural Resources Corp (ENRC), both released updates during the week. Ferrexpo, an iron-ore pellet producer in the Ukraine, showed increased production and sales prices which fed through to much higher earnings for the half year to end-June. ENRC, which produces iron ore and chrome in Kazakhstan, said its operations in the country were running at full capacity. Volumes from the company’s aluminium division also increased.

Three of the big four reported results to the end of June, with BHP Billiton expected to report on August 25. Xstrata plc said it had approved US$8 billion in projects during the half year, part of a pipeline that will increase production by 50%.

Rio Tinto announced record first half results on Thursday morning. Earnings before interest, tax and depreciation (EBITDA) were up 85% to US$11.3 billion.
Anglo American plc reported mixed results last Friday, reinstating its dividend but also announcing likely delays and cost increases at its Minas Rio iron-ore project in Brazil.

On AIM, Bellzone Mining plc’s announcement it had concluded definitive terms for the funding and development of infrastructure for its Kalia iron-ore project in Guinea with China International Fund Ltd (CIF) pushed the company's share price 25% higher. The US$2.7 billion deal would support the US$1.2 billion iron-ore operation based on inferred resources estimated at 2,400Mt.

Turkey-focused Ariana Resources plc was 28% ahead after saying the latest drilling results from the Banu and Derya veins at its Red Rabbit project “confirmed the integrity” of the resource at the Kiziltepe prospect. The company added that the gold and silver grades were “robust” and demonstrated economic potential.

Russian-focused Amur Minerals Corp surged 23% after raising £1.2 million through the placement of 35 million shares. The company intends to use the funding for its Kun-Manie copper-nickel project.

Despite not making any announcement, the week’s top performer was Turkey and Saudi Arabia gold explorer Kefi Minerals plc. Other significant risers included Eurasia Mining plc and EMED Mining Public Ltd, which gained 46% and 24%. respectively.

Palmaris Capital plc, which owns 16% of coal producer Scottish Resources Group (SRG), dropped 15% to be the week’s biggest faller. SRG last week announced it had pulled plans for a £200 million stock market flotation.

Arian Silver Corp was down more than 11%. The company’s only news this week was that it had appointed XCAP Securities Ltd as its new broker.

Explorer Forte Energy NL was down 10% despite releasing encouraging assay results from recent drilling at the A238 uranium anomaly within its licences in the Zednes region of Mauritania.