The first-quarter result compared with $10,786 for the same period a year ago, translating into earnings per share of 2.63c versus the previous 0.03c. Serabi's shares (AIM:SRB) jumped 22.36% Wednesday to 29p (US37.46c).  

EBITDA increased 47% yoy to $4.3 million for Q1 2-19.

CEO Mike Hodgson said the company sold 12,309 ounces during the period, with inventory levels now back to more normal levels meaning sales and production volumes were likely to track more closely over the rest of the year.

The average gold price received during the quarter was $1,287 per ounce, down from $1,319/oz a year ago, although Hodgson said Serabi had been helped by a strong gold price when looked at in Brazilian Real.

"With so much of our cost base incurred in Brazil this is the true indicator of our margin and profitability. Following the election of Jair Bolsonaro as president in November 2018, many, myself included, saw the potential for the Real to strengthen as he pursued public spending reforms and implemented business friendly policies to promote growth. 

"To date however the exchange rate has remained in the range of BRL$3.80 to US$1 and the gold price in Brazilian Real has averaged BRL4,850 for the quarter compared with BRL4,264 for the same period in 2018 and BRL4,600 for the 2018 calendar year."

As previously reported, Serabi produced 10,164oz of gold during the March quarter, rising 10.6% year-on-year, from 42,609 tonnes of mined ore, up 7.4%, at an average gold grade of 7.47g/t, slightly lower than 7.49g/t a year ago.

All-in sustaining costs for the quarter were $1,021/oz, down from $1,166/oz a year ago.

"Given the nature of the operations, Serabi has a fairly fixed level of monthly costs, in the form of labour, power and consumable costs. With the mine and plant producing and processing broadly consistent tonnages of ore, the key to profitability is maximising the grade of the ore mined and processed.  

"Whilst the improvements in the last six months to the processed grade have been relatively small, the benefits have been quite significant," Hodgson said.

Serabi had cash holdings of $12.1 million at the end of March, an increase of $2.9 million from the end of 2018.

Hodgson said net cash generated in the period was slightly less than $3 million after taking into account mine development, exploration and other capital expenditure, but had been helped by the delayed sales carried over from the end of 2018. 

"Provided the company can maintain the current levels of production, I am confident that we can maintain a good cash flow for the rest of the year," he said.