For calendar 2018, the AIM-listed group reported a profit before tax of £2.2mln compared to £0.4mln in the previous year, thanks to a £3.7mln profit from its 50% share of the Kiziltepe Mine in western Turkey, which is owned via its Red Rabbit joint venture. Earnings per share of 0.21p compared to 0.04p last time.
The 27,100 ounces produced by Kiziltepe in 2018 were extracted at an average cash-cost of US$415 per oz and sold at an average gold price of US$1,269 per oz and silver price of US$15 per oz.
While the continued slump of the Turkish lira led to £2.2mln of foreign exchange translation losses on the income statement, which may be reclassified subsequently to profit or loss to reflect the effects of the cost of Turkish denominated assets, chairman Michael de Villiers said: “In many ways we are the beneficiaries of having a business which is US dollar denominated in terms of revenue, with a reduced cost base in terms of our lira expenditure.”
At the end of December, Ariana had £0.9mln of cash in the bank, up from £0.77mln a year before.
De Villiers said that with Kiziltepe paying cash dividends and maintaining debt repayments, its financial strength has allowed progress of Red Rabbit’s nearby Tavşan Project to the next stage of development.
He added that Tavşan remained “on schedule” to complete formal environmental impact assessment submission late this year 2019, with a feasibility study to follow and, subject to financing and permits, potentially leading to the mine’s starting to be developed some time in 2020.
Furthermore, de Villiers was bullish about exploration, noting that this was “continuing apace” across various project areas and with the coming year “on target to be our busiest year of exploration activity to date”, while also boasting that Ariana’s costs remain in the lowest quartile worldwide at approximately US$15 per oz.
Ariana shares were up 8% to 2.08p after an hour of trading on Wednesday.