LONDON (ShareCast) - (Sharecast News) - Brazil-focussed miner and developer Serabi Gold reported full-year 2022 revenue of $58.7m, down from $63.1m in 2021 due to lower production.
The AIM-traded firm said its gold production for the year totalled 31,819 ounces, with 7,798 ounces produced in the fourth quarter.

Its EBITDA totalled $8.8m, more-than-halving from $19.1m recorded in the prior year, while Serabi Gold reported a post-tax loss of $1m for 2022, which included a provision of $1.2m against the recovery of historic tax debts owed to the company in Brazil.

Cash held at year-end in December was $7.2m, a decrease from the $12.2m recorded at the end of the previous year.

The company said the average gold price received on sales during the year was $1,785 per ounce, which was slightly higher than the $1,776 recorded in 2021.

However, the cash cost for the year was $1,322 per ounce, higher than the $1,090 in 2021, while the all-in sustaining cost (AISC) came in at $1,615 per ounce, up from $1,429 year-on-year.

In the three months ended 31 December, Serabi's cash cost was $1,227 per ounce, representing a 1.2% improvement on the quarter.

The AISC for the same period was $1,473 per ounce, which was a 5.8% improvement compared to the third quarter of 2022.]

Serabi Gold said it had a "robust" first quarter of 2023, with 8,005 ounces of gold production.

The firm's production guidance for the year was for between 33,500 and 35,000 ounces of gold.

"The past 12-month period was always planned to be a year of investment as the group continued its work on the development of the Coringa project that had started midway through 2021," said chief financial officer Clive Line.

"The ability to process and sell gold from the development ore being mined from Coringa was not originally planned for but with approximately 1,000 ounces of gold produced in the second six months of 2022 the additional cash flow that this has generated has helped offset the operating costs of the initial mine development.

"We were successful in generating $5m of short-term loan funding through a Brazilian bank to provide some additional working capital which was necessary to compensate for the lower-than-forecast production levels that became apparent towards the end of the first quarter of 2022, resulting from the mining problems encountered at the Sao Chico deposit."

Line said the nature of the arrangement was such that it must be physically repaid through the Brazilian Central Bank.

In February, the group was offered a further similar unsecured loan arrangement for $5m with Santander Bank in Brazil.

Clive Line said the Santander loan would be repayable as a bullet payment on 22 February 2024, and carried an interest coupon of 7.96%.

The proceeds raised from the loan would be used for working capital and secure adequate liquidity to repay the initial loan which was due to be repaid on 12 May this year.

During the year, the group also finalised an unsecured facility with HSBC Bank allowing it to enter into leasing of precious metals for up to 12 months at a time.

The group had not used the facility, but Clive Line said it provided a further opportunity for accessing short-term working capital.

"We have already seen a strong start to the year with production from Coringa being especially pleasing, demonstrating the potential that this project has to support the group's future growth.

"The completion of the ECI study is, we believe, a significant step to securing the longer-term licensing for Coringa.

"A strong gold price is helping cash flow and we look forward to keeping shareholders informed on further good news through the rest of 2023."

At 0953 BST, shares in Serabi Gold were up 5.42% at 28.99p.

Reporting by Josh White for Sharecast.com.

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