Perseus now has two operating gold mines in West Africa
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Perseus Mining’s second operating gold mine in West Africa has reached the cashflow positive mark earlier than expected.
Perseus (ASX:PRU) told investors its Sissingué mine in Ivory Coast was cashflow positive at the end of March.
Investors welcomed the news, pushing shares up as much as 5.4 per cent to 49c just before midday AEST Tuesday.
Reaching commercial production at Sissingué “materially reduces our reliance on our Edikan mine in Ghana for cash generation,” managing director Jeff Quartermaine told investors.
Mr Quartermaine told Stockhead that the mine reached various production targets about a month ahead of schedule, but Perseus declared commercial production at the end of the March quarter, which was in line with its forecast and the reporting period.
Perseus says it is on track to achieve its production target of 140,000 to 160,000 ounces for the half-year and 250,000 to 285,000 ounces for the full 2018 financial year.
The company has not yet disclosed its earnings forecasts for the half-year, but Mr Quartermaine noted that a “strong performance at Sissingué will be a positive” in helping Perseus book a profit.
Perseus managed to narrow its loss after tax in the second half of 2017 to $11.5 million from $25.6 million a year earlier on the back of higher revenues and lower costs.
Cash flows from the Edikan mine in Ghana and the Sissingué mine will partially fund the development of the company’s third gold mine, Yaouré.
Early works at Yaouré are anticipated to begin in the third quarter of this year before full construction begins in late 2018, subject to Perseus meeting a number of milestones.
Perseus is aiming to eventually produce 500,000 ounces of gold each year from the three operations.