Anglo Asian Mining PLC (AIM:AAZ, FRA:A4A, OTC:AGXKF) expects its financial performance to improve in the second half after it reported a decline in interim pretax profit due to higher input costs and lower gold production.
Pretax profit for the six months to end June fell to US$5.9mln from US$11.8mln in the year-earlier period as revenue dipped 5% to US$43.5mln.
“The company's overall profitability in the first half of 2021 reduced compared to the previous year, however results were in line with expectations and we anticipate an improved financial performance in the second half of 2021,” said Reza Vaziri.
“This year has seen the easing of most COVID-19 restrictions that had placed constraints on our business both in Azerbaijan and elsewhere, and the Gedabek site now operates normally. We are now regularly shipping doré to Switzerland by scheduled airflights and our refiners are in full operation,“ he said.
“In view of our current performance and expected improved cash generation in the second half of the year, the board is declaring an interim dividend of US 4.5 cents per ordinary share,” added chairman Khosrow Zamani.
First-half production decreased to 32,171 gold equivalent ounces, from 32,501 ounces, as gold output totalled 24,249 ounces versus 27,922 ounces.
The all-in sustaining cost of gold production jumped to US$848 an ounce, from US$743 per ounce, as a result of lower output and increased consumption and prices of diesel fuel and reagents.
The company reiterated its full-year production guidance of between 64,000 to 72,000 gold equivalent ounces.
Anglo Asian Mining also said it has reviewed its current concessions and is in negotiations with the government of Azerbaijan regarding its portfolio of contract areas.