Golden Giant strike cuts Hemlo’s earnings

A drop in gold production has contributed to a 38% shortfall in earnings for Hemlo Gold Mines (TSE).

For the first six months of 1995, Hemlo earned $23.4 million (or 23 cents a share) on revenue of $106.5 million, compared with $38.1 million (or 39 cents a share) on $141.2 million in the same period last year.

Gold production fell to 201,000 oz. during the first six months of 1995, down sharply from the 273,000 oz. cranked out in the same period last year. A deficit of about 20,000 oz. was caused by the strike that began June 17 at the Golden Giant mine, east of Marathon, Ont.

Contributing to the shortfall was the fact that Hemlo was mining lower-grade ore at its 55%-owned Silidor mine near Rouyn-Noranda, Que. Meanwhile, at the Holloway joint venture in northeastern Ontario, water inflows and adverse ground conditions impeded shaft-sinking. Conditions have since improved, however, and development is proceeding on schedule. Neverthe- less, Hemlo has been forced to postpone its startup date to the third quarter of 1995.