Interim Results Announcement for H1 2011
20.09.2011
View the full results announcement (PDF - 296 Kb)
20 September 2011 - Highland Gold Mining Limited ("Highland Gold", or the "Company") announces its production and financial results for the half year ended 30 June 2011.
FINANCIAL SUMMARY
| IFRS, US$000 (unless stated) | H1 2011 | H1 2010 |
| Production (gold and gold eq. oz) | 93,057 | 85,789 |
| Total Group cash costs (US$/oz) | 531 | 518 |
| Revenue | 158,085 | 100,473 |
| Gross profit | 85,355 | 43,226 |
| EBITDA | 88,068 | 46,687 |
| Net profit after tax | 70,296 | 23,334 |
| Earnings per share (US$) | 0.216 | 0.072 |
| Net cash inflow from operations | 77,778 | 37,449 |
| Capital expenditure | 31,388 | 13,685 |
| Cash, short term deposits and bonds | 272,233 | 216,484 |
HIGHLIGHTS
Financial:
- Net profit after tax tripled year-on-year to US$70.3 million (H1 2010: US$23.3 million) and resulted in earnings per share of US$0.216 (H1 2010: US$0.072), demonstrating the Company's leverage to higher gold prices
- EBITDA was US$88.1 million (H1 2010: US$46.7 million), an 88.6% increase due to increased production, gold sales volumes and higher realised prices
- Total group cash costs were contained at US$531/oz (H1 2010: US$518/oz), despite inflationary cost pressures
- Cash margins expanded significantly to US$922/oz (H1 2010: US$645/oz) as the Company is unhedged and fully participated in the increase in gold prices
- Cash, short term deposits and bonds at June 30, 2011 were US$272.2 million (H1 2010: US$216.5 million) due to the generation of strong net cash inflow from operations
- An interim dividend payable of 5.0 pence per share (H1 2010: £nil per share), consisting of an ordinary dividend of 2.5 pence and a special dividend of 2.5 pence per share
Producing Mines:
- Mnogovershinnoye ("MNV"), Novoshirokinskoye ("Novo") (48.3% shareholding) and Belaya Gora combined produced 93,057 oz of gold and gold equivalents - an 8.5% increase on H1 2010 production
- New JORC compliant audit increased MNV reserves by 190%
- Novo continued production ramp up resulting in a 33% increase in processed tonnes compared to H1 2010
- The Company remains on track to produce 210,000 - 220,000 oz of gold and gold equivalents in 2011
Development and Exploration Sites:
Belaya Gora select oxide ore processing via MNV continued during the first half of 2011 and pre-construction preparations for a stand-alone processing facility remained on track with the submission of design documentation to Federal authorities
- MNV exploration programme continued to target potential resources adjacent to existing operations
- 1.38 million oz of C1+C2 reserves at Unkurtash approved by the State Committee on Reserves in Kyrgyzstan
- Exploration drilling and underground development results at Unkurtash support potential continuity of mineralisation along strike and at depth
- Exploration work at Lyubov being compiled for GKZ regulatory submission and commencement of JORC audit by year end 2011
- Blagodatnoye and Belaya Gora Flanks exploration properties continue to provide positive drilling intercepts
CONFERENCE CALL DETAILS
The Company will hold a conference call on Tuesday, 20 September 2011 hosted by Valery Oyf, CEO to discuss the interim results. The conference call will take place at 8.30 UK time (11.30 Moscow). To participate in the conference call, please dial one of the following toll-free numbers:
UK Free Call 8000 440 189
UK Local Call 0844 493 38 00
UK Standard International + 44(0) 14 52 55 55 66
Russia Free Call 8108 002 097 2044
USA Free Call 1866 966 9439
Conference ID 1167 08 19
A replay of the presentation will be accessible shortly afterwards by dialing one of the following numbers:
International Dial In: +44 (0) 1452 55 00 00
UK Free Call Dial In: 0800 953 1533
UK Local Dial In: 0845 245 5205
USA Free Call Dial In: 1866 247 4222
Encore Replay Access Number: 11670819#
For further information please contact:
Highland Gold
Duncan Baxter, Chairman - + 44 (0) 1534 814202
Dmitry Yakushkin, Head of Communications - +7 495 4249521
Matrix (Nominated Adviser)
Nick Stone - + 44 (0) 203 206 7000
Stephen Mischler - + 44 (0) 203 206 7000
The Interim Report to 30 June 2011 will be available on our website from 21 September 2011.