Amax Gold (TSE, NYSE) continues to post a strong operating performance, with second-quarter output up 29% to 91,654 oz., primarily due to excellent results at its new Wind Mountain mine in Nevada. It turned out 22,392 oz., compared with its startup level of 3,620 oz. in the second quarter of 1989. Gross operating margin for this latest quarter amounted to US$15.8 million, compared with US$15.l million. But after taking a US$12.6- million writeoff to reduce substantially the carrying value of its investment in Canamax Resources (TSE), there was a net loss of US$4.5 million or 7 cents per share, compared with second quarter net earnings of US$8.9 million or 15 cents per share last year.
“Second-quarter operating results were outstanding, particularly in view of falling gold prices. All of Amax Gold’s operations are running at peak efficiency,” says Timothy Haddon, the American firm’s chief executive officer.
“Current weak conditions in gold markets led to the decision by Canamax to suspend operations at two of its three Canadian producing properties. In line with that decision and our conclusion that Amax Gold’s holdings in Canamax is not expected to be maintained for the long term, this investment has been reduced,” Haddon reports.
“Given Amax Gold’s superior cost position, we expect a continued strong performance over the remainder of 1990 despite current gold prices,” he adds.
Sales for the latest quarter were US$37.2 million, compared with US$28.9 million for the same period last year. The average price realized was US$400 per oz., US$34 higher than the average COMEX price. Cash production costs were US$143 per oz., compared with $130 in the similar period of 1989. Amax Gold (NYSE) $000s except per-share items* 6 months ended June 30 1990 1989 Revenue $72,500 $57,500 Net earnings 5,500 18,100
per share 0.09 0.30 *US dollars004
Be the first to comment on "New Wind Mountain gold mine boosts Amax Gold’s earnings"