By Lawrie Williams – writing on biznews.com
LSE quoted Acacia Mining – formerly African Barrick Gold (ABG) – has come up with some poor Q3 production and cost figures, after a number of quarters of apparent improvement. It has led to annual gold production guidance being reduced and costs guidance rising.
While the Q3 figures may just be a temporary blip due to unavoidable circumstances, it brings back memories of the old ABG days where quarter of poor results followed quarter of poor results, which prompted parent company Barrick Gold, which owns 63.9% of the Tanzanian gold miner, to put the company on the chopping block for sale.
But since then, to give Acacia its due, restructuring, cost cutting and improving the mining plan had seemed to have come up with some substantial performance improvements and Acacia had looked to be on the route to sustained profitability and cash flow generation, even at the lower gold prices now prevailing. But the latest quarterly figures suggest that such improvements are perhaps at best tentative in the difficult mining environment that its Tanzanian operations present.
The latest production and costs figures show Q3 gold output falling below plan to 164,000 ounces, as several short-term factors negatively impacted output at Bulyanhulu and Buzwagi over the period……..