Centamin PLC Announces 2013 Annual Results
March 24, 2014 - Perth, Australia
Centamin plc (LSE: CEY) (TSX: CEE)
Centamin plc ("Centamin" or "the Company")
(LSE: CEY; TSX:CEE)
This is not the full announcement. For the full announcement, please click here:
HIGHLIGHTS FOR THE YEAR ((1) (2))
Centamin remains in a robust position to continue delivering on its track record of production growth and solid cash flow generation during 2014 and beyond, as demonstrated by the following highlights:
- Full year production was 356,943, a 36% increase on 2012 and above guidance of 320,000 ounces.
- Cash costs of production of US$663 per ounce (2012: $669 per ounce).
- Record EBITDA of US$234.2 million, up 1% on the prior year.
- Basic earnings per share 16.87 cents, down 8% on prior year.
- Stage 4 plant expansion (to nameplate capacity of 10Mtpa) expenditure at the year end was US$327.8 million of the reforecast cost of US$331.2 million, including contingency.
- Centamin remains debt-free and un-hedged with cash, bullion on hand, gold sales receivable and available-for-sale financial assets of US$142.5 million as at 31 December 2013.
Centamin delivered strong operational and financial results in 2013, producing 356,943 ounces of gold (2012: 262,828 ounces) and generating profit after tax for the year of US$184.0 million (2012: US$199.0 million). Centamin has continued to return strong earnings and cash flow generation despite the weaker gold price environment, owing to the Group's emphasis on maximising productivity and maintaining rigorous cost control. Now in its fifth year of production, the Sukari Gold Mine remains highly cash generative, with EBITDA of US$234.2 million (2012: US$233.3 million). Centamin has a robust cash and cash equivalents balance of US$106.0 million (2012: US$147.1 million) as at 31 December 2013.
2013 saw the Sukari operation performing well across all areas. Most notably, the processing plant operated consistently at c.15% above nameplate capacity and the output from the underground mine continued to rise quarter-on-quarter to end the year at levels significantly above original expectations. The completion of construction of the Stage 4 plant expansion, which is currently under commissioning, sets the stage for the next step-up in production towards Sukari's long-term target of 450-500,000 ounces per annum from 2015 onwards.
An updated resource and reserve statement for Sukari was announced on 18 December 2013, with the total Measured and Indicated resource containing 13.4 million ounces (Moz) and the total reserve containing 8.2Moz. This takes into account the latest drill results, higher cost environment and the timing of the Stage 4 commissioning. The underground reserve of 2.30 million tonnes (Mt) represented a 120% increase on the December 2011 reserve, despite mining depletion. We remain confident of further significant reserve expansion, with the 0.52Mt Proven component of this reserve showing a grade of 11.4g/t gold, and continued positive results from on-going drilling into the target high-grade extensions.
The Company progressed its medium and long-term growth strategy during 2013. In September, Centamin entered into a joint venture with AIM-listed Alecto Minerals over their exploration projects in Ethiopia, thus expanding the Company's presence in this important region of focus. A recommended all-share takeover offer for ASX-listed Ampella Mining Ltd, valued at A$40.9 million, was announced on 10 December 2013. This takeover provides Centamin with an extensive licence holding over a highly prospective and underexplored 100km+ trend of gold mineralization in Burkina Faso. Centamin will implement a systematic exploration programme, aimed at developing the potential for further substantial growth of the existing resource base, being 1.92Moz Indicated and 1.33Moz Inferred.
The Company continues to hold equity interests in Nyota Minerals Limited and Sahar Minerals Limited, however, these investments have been impaired during the year to reflect their fair value.
The Supreme Administrative Court appeal and Diesel Fuel Oil ("DFO") Court Case are both ongoing. Operations continue as normal and any enforcement of the Administrative Court decision has been suspended pending the appeal ruling. We remain confident that a satisfactory outcome will ultimately be achieved in both cases.
With respect to the DFO case, management recognises the practical difficulties associated with re-claiming funds from the government and, for this reason, has fully provided against the cumulative prepayment of US$97.0 million as an exceptional item (refer to Note 6 to the Financial Statements). In the meantime the Group is continuing to pay international prices for DFO.
1. Cash cost of Production, EBITDA and cash, bullion on hand and available-for-sale financial assets are non-GAAP measures.
2. Basic EPS, EBITDA, Cash costs of Production reported includes an exceptional provision against prepayments to reflect the removal of fuel subsidies which occurred in January 2012 (refer to Note 6 of the Financial Statements for further details). The provision had no further impact on the 2012 and 2013 results other than previously reported.
Centamin will host a conference call on Monday, 24 March at 9.00am (London, UK time) to update investors and analysts on its results. Participants may join the call by dialling one of the following three numbers, approximately 10 minutes before the start of the call.
From UK: 0808 237 0040 Canada: +1 866 404 5783 Rest of world: +44 203 428 1542
Participant pass code: 93268020#
For details of the full announcement please visit http://www.centamin.com/centamin/investors/news-media/news/2013-annual-results
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