Serabi Gold's H2 profit more than triples as gold price soars
By Sean Farrell
Date: Friday 14 Aug 2020
(Sharecast News) - Serabi Gold's second-quarter profit more than tripled as the price of gold soared in response to economic uncertainty caused by the Covid-19 pandemic.
Operating profit rose to $4.6m (£3.5m) from $1.3m in the three months to the end of June from a year earlier as revenue increased to $16.3m from $12.5m.
The AIM-traded Brazilian gold miner said average the gold price received during the second quarter jumped to $1,710 per oz from $1,292 per oz. Serabi said its results were also boosted by the weakness of the Brazilian real against the dollar.
Gold has continued to rise in August, breaching the $2,000 per oz barrier. Serabi said it produced 17,524 ounces of gold in the first half and that it hoped to return to full staffing at its mine before the end of the third quarter.
The company said third-quarter performance should be similar to the second with a return to full production early in the fourth quarter. In this case annual production will be between 34,000 and 37,000 ounces.
Chief Financial Officer Clive Line said: "The second quarter of the year has proved, financially, to be one of our most successful ever.
"Since the end of the quarter we have seen continued improvement in the gold price. With the expectation of gold production for the third quarter being at similar levels to that of the second quarter levels, this bodes well for the company's cash generation going forward."
Serabi Gold shares rose 2.8% to 93p at 10:05 BST. The shares have doubled since the end of March as uncertain economic prospects have prompted investors to invest in gold.
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