OceanaGold tables strong financials despite production dip

Melbourne-based gold miner OceanaGold (TSX: OGC; ASX: OGC) has recorded a particularly robust first half of the year, with profits rising up 45%, revenue up 21%, and debt cut in half.

For the six months ended June 30, OceanaGold had a net profit of US$89 million (US$61 million in the year-ago period) on revenue of US$402 million (US$333.5 million), even though production levels in the first half dipped to 268,600 oz. gold (272,400 oz. gold in the year-ago period) and 7,800 tonnes copper (10,300 tonnes).

OceanaGold has four operating mines: the Haile gold mine in South Carolina; the Didipio gold-copper mine in the northern Philippines; and the Waihi and Macraes gold mines in New Zealand.

All-in sustaining costs were up a bit in the first half to US$696 per oz. versus US$681 per oz. in the year-ago period.

For all of 2018, OceanaGold is boosting its guidance for total production to 500,000 to 540,000 oz. gold and 15,000 to 16,000 tonnes copper, thanks to stronger performance at Haile and Didipio.

As it recorded net profits in the first half of 14 cents per share, OceanaGold has declared a semi-annual dividend of 2 cents per share.

OceanaGold ended the second quarter with US$128.9 million in cash, up 60% from a year earlier, and had a net debt of US$103.9 million, almost half the level a year ago.

The company is working to extend mine life at Waihi on the North Island by at least 10 years, and at Haile is permitting the Horseshoe underground and expanded pit workings. At Didipio, underground operations are ramping up.