Vancouver — The latest financial results tabled by Australian-based Delta Gold could heat up its merger talks with South African-based Goldfields (GOLD-N).
“This has been an excellent year for Delta and has allowed us to build a strong balance sheet for a strong company,” says Terry Burgess, the company’s CEO.
Delta posted net profits of A$51.9 million, compared with a loss of A$114.8 million last year.
Despite reduced production, reduced operating costs generated a 16% gain in operating profits to A$32.2 million for the year.
Net debt was reduced to A$15.3 million from A$108.6 million at the end of 1999-2000. The reduction came as a result of the settlement of a political risk insurance claim in the Solomon Islands and the sale of 30% of Zimplats in Zimbabwe. Delta was forced to suspend operations in both countries last year due to political instability.
Delta holds 100% of the Kanowna Belle, Golden Feather and Wirralie gold mines and has a 40% stake in the Granny Smith mine. All of its current operations are in Australia.
Earlier this month, Delta and Goldfields announced that they are in preliminary merger talks. Such a move would create one of Australia’s largest gold-mining groups with a market capitalization of around A$900 million.
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