Saracen Mineral Holdings Announces Production Underpins A$46m Interim Net Profit

Saracen Mineral Holdings (ASX: SAR) reported an outstanding first half in which record production underpinned substantial increases in cashflow and earnings.

The strong performance is a direct result of the investment Saracen has made in exploration and development, which has led to it building a 2.1 million-ounce Reserve base and growing production to 300,000ozpa. The Company also has significant potential to grow its inventory, mine life and production further from its existing assets.

Net profit after tax (NPAT) rose 209% in the six months to A$46 million. This came on the back of a 32% jump in sales revenue to A$245.6 million and increased gold sales of 154,119 ounces (PCP: 119,550 ounces).

NPAT included a A$10.6 million profit on the sale of the King of the Hills Project in October 2017. Underlying NPAT¹ increased 149% to A$37.2 million.

Depreciation and amortisation increased to A$46.3 million (PCP: A$30.5 million). This was driven by the increase in overall production and the amortisation of the Thunderbox Zone A deferred mining expenditure (triggered by the actual strip ratio falling below the average life-of-mine strip ratio).

EBITDA rose by 123% to A$103.4 million reflecting the increased production and an improving cost profile supported by a healthy Australian-dollar gold price.

Cash and equivalents rose to of A$82.9 million at December 31, up from A$45.2 million six months earlier, with no debt. This was after spending A$37.6m during the period on growth capital and exploration.


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