Egypt-focused Centamin ((TSX: CEE; LON: CEY) has reported a 25% increase in annual profit thanks to higher gold sales at soaring prices for the precious metal.
The miner’s profit last year rose 14% to US$195.1 million from US$171 million in 2022, with revenue climbing 13% to US$891.3 million from US$788.4 million.
Gold sales from Sukari in Egypt, the company’s only producing mine, totalled 456,625 oz., up 4% from 438,638 in 2022. This as Centamin saw realized prices for the precious metal increase 8.6% to US$1,948 per oz. from a previous US$1,794 per ounce.
Bullion prices climbed 15% in 2023, ending at US$2,078.40 an ounce, a record high year-end figure, according to data from the World Gold Council. The average 2023 price of US$1,940.54 an ounce was 8% higher than the 2022 average, marking the metal’s best year since 2020.
“2023 was the third consecutive year that we have safely delivered on our production guidance, reflecting the operational improvements and flexibility from our three-year reinvestment plan,” chief executive Martin Horgan said in a release.
The company cut its payout to shareholders to US2¢, down from US2.5¢ it handed in 2022. This made a total payout of US4¢, down 20% from US5¢ the previous year.
Improvements at Sukari
The executive said Centamin had “re-positioned” its Sukari gold mine to achieve a consistent annual production of 500,000 ounces. He also anticipated a reduction in operational expenses following the establishment of solar power generation capabilities.
The company invested less than expected last year, US$204 million in total, below guidance of US$272 million. It attribute the drop to cost savings, lower costs capitalization and changes to equipment rebuild schedules.
Centamin highlighted a grid connection project that it kicked off last year, thanks to recent upgrades to Egypt’s power distribution infrastructure. It expects the project, which would be supplemented with the existing onsite solar power generation, to cut US$41 million a year just in diesel costs.
The plan would also help Centamin achieve its near-term decarbonization goals. It is targeting a reduction of 30% of its Scope 1 and 2 emissions, those hose incurred through mining operations and power consumption, respectively, by 2030.
The miner left its 2024 gold production guidance range of 470,000 to 500,000 oz. unchanged.
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