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Mandalay sees revenues grow in third quarter despite lower output

Thursday, November 3, 2016 7:46
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Increased metals prices pushed up revenues at Mandalay Resources Corp (TSE:MND) in its third quarter but taxes and write-offs meant net income was lower.

The firm produces gold, antimony and silver in Australia, Chile and Sweden and in the three months to September 30 and posted revenue of  $48.5 mln (million) compared to $43.3mln in the same period last year.

Adjusted EBITDA (underlying earnings) rose to $13.8mln from $11.5mln last year, while net income decreased to $0.5mln from $1.6mln last year.

This loss was due to a combination of higher taxes at the Costerfield mine in Australia, which has exhausted its tax-loss carryforwards, and the write-off of $1.2 million for mineral properties and exploration.

The board has declared a quarterly dividend of $2.9 million, or $0.0065 per share, payable on November 24.

Total production was 34,586 ounces of gold equivalent (2015: 40,293 ounces) – lower due to the previously reported operational suspension at Cerro Bayo.

Cash costs were also higher in the current quarter than the same period in 2015 ($970 per ounce gold equivalent compared to $783 per ounce gold equivalent in the year ago period).

Mandalay ended the quarter $74.6 million in cash and cash equivalents, up from $45.7 million at the beginning of the quarter, it added.

For the year as a whole, Mandalay expects to deliver its original guidance range for gold, exceed original guidance for antimony, and fall short of the original guidance for silver.

The overall effect, including metal price changes, is to reduce the gold equivalent production guidance from between 165,000 and 180,000 ounces to now 149,000-152,000 ounces.

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