Centamin yearly gold sales down 13% but Q4 sales up 26%

By Dominic Ellis
Centamin's annual gold production was delivered in line with guidance and this year it aims to unlock further value from the Sukari Gold Mine

Centamin reported a 13% drop in annual gold sales to 407,252oz last year but the year ended brightly with Q4 2021 sales rising 26% year-on-year to 99,936oz.

Annual production for the gold mining operator was delivered in line with guidance (400,000-430,000oz), totalling 415,370 oz for the year, with production of 107,549oz for the three months to December 31.

CEO Martin Horgan said 2021 was characterised by solid delivery against stated plans and completion of the Sukari Gold Mine Life of Asset study, confirming the high-quality and long life of the mine, in addition to identifying significant upside growth opportunities.

Sukari is a bulk tonnage open pit and underground operation which began production in 2009 and is the first large scale modern gold mine in Egypt, as well as one of the world’s largest producing mines. It is forecast to produce in excess of 400,000 ounces a year.

"We continued to improve our safety performance, beating our annual targets, as we strive to achieve a zero-harm workplace," said Horgan. "We have commenced 2022 with confidence and excitement and look forward to delivering on our clear roadmap to growing and unlocking further value from Sukari and our exploration portfolio."

Highlights from Q4 mining operations 

• Strong safety performance: Q4 Lost Time Injury Frequency Rate of 0.31 per one million site-based
hours worked; FY LTIFR of 0.46, 28% better than the annual target of 0.65 
• Q4 revenue of US$183mn, generated from gold sales of 99,936oz at an average realised gold price of US$1,828/oz sold; FY revenue of US$733 million, generated from gold sales of 407,252 oz at an average realised gold price of US$1,797/oz sold
• Q4 cash costs of US$972/oz produced and all-in sustaining costs of US$1,256/oz sold; FY cash costs of US$859/oz produced and all-in sustaining costs of US$1,211/oz sold were delivered at the midpoint of annual guidance (Cash costs: US$800-900/oz produced; AISC: US$1,150-1,250/oz sold)
• Q4 capital expenditure of US$86mn; FY capex of US$233mn, exceeding the annual guidance of US$225mn due to the waste-stripping outperformance
• Q4 exploration spend of US$6mn advancing the Doropo and ABC projects in Côte d’Ivoire; FY exploration spend was US$14mn and US$3 million below the annual guidance
• Cash and liquid assets of US$257mn, as at December 31
• Full COVID-19 protocols remain in place, and supply chains and gold shipments have not been materially impacted
• The company will publish its full year 2021 financial results and propose the final dividend in mid-March

Outlook for mining operations

• Gold production of 430,000-460,000oz
• Cash costs of US$900-1,000/oz produced
• AISC of US$1,275-1,425/oz sold
• Capex of US$215 million, including US$25 million of deferred solar and paste-fill plant construction expenditure
from 2021
• Exploration expenditure is expected to be US$25 million, predominantly focussed on the Doropo Pre-Feasibility
Study (scheduled for completion in H2 2022), ABC fieldwork and drill testing, and commencing exploration on the
Egyptian Eastern Desert 3,000sqkm highly prospective landholding.

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