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Avesoro ends Q1 at a loss

West Africa gold producer Avesoro Resources ended the March quarter in the red, reporting a net loss after tax of US$11.8 million.
Avesoro ends Q1 at a loss Avesoro ends Q1 at a loss Avesoro ends Q1 at a loss Avesoro ends Q1 at a loss Avesoro ends Q1 at a loss

Avesoro's Youga mine in Burkina Faso

This compared with a net profit of $9.8 million a year ago.

EBITDA dropped 76% on the year to $9.5 million, with the EBITDA margin also down to 16% from 44% a year ago.

Quarterly revenues also fell 34% year-on-year to $59.9 million, while cash flow from operations was $5.1 million, down 87% from a year ago.

Avesoro previously said it had weaker than targeted performances at its New Liberty and Youga gold mines in Liberia and Burkina Faso, respectively, in the March quarter, due to plant throughput issues. Total gold production from the two mines fell 34% year-on-year to 45,098 ounces, down 3%.

The gold was produced at an all-in sustaining cost of $1,149 per ounce, up 26% from a year ago.

Avesoro sold 45,810oz of gold during the March quarter, down 33%, at an average realised price of $1,304/oz, 2% lower year-on-year.

Capital expenditure in the first three months of 2019 was $7.9 million, down 42% compared with the same period a year ago, while the company had cash of $9.3 million at the end of March compared with $3.5 million at the end of December.

Gross debt rose 1% on the year and 9% quarter-on-quarter to $138.8 million.

CEO Serhan Umurhan said the company was on track to achieve annual production and cost guidance for 2019.

He said Avesoro had worked through a period of unplanned mining dilution at Youga and expected mined grades to increase through the current quarter.

"The focus going forward remains firmly on driving efficiencies and continued operational improvements to deliver on our recently released revised life of mine plans at our assets in Liberia and Burkina Faso," he said.