PERTH (Scrap Monster): Australia's second-biggest gold producer Kingsgate Consolidated expects to produce more than 200,000 ounces of gold this financial year, after a big jump in profit and record sales.
Kingsgate reported a net profit of $75.2 million for the year ending June 30, up 255 per cent from $20.9 million on the previous corresponding 12 months and its revenue increased 100.7 per cent to $357 million.
However, shares in the gold miner were down 26 cents, or 5.2 per cent, at $4.73 by 11.53am, as the broader market slumped by around one per cent today.
Kingsgate said its financial performance was driven by record gold sales of 204,145 ounces, up 78 per cent from the prior year, and a higher average realised gold price of $US1,663 ($A1,614) per ounce.
The company said its higher gold production came from an increase at its Chatree operation in Thailand following the expansion of processing facilities there and 12 months of operations at its underperforming Challenger mine in South Australia.
Kingsgate said gold production in fiscal 2013 was expected at between 200,000 and 220,000 ounces.
The miner expects to complete a draft technical feasibility study at its Nueva Esperanza mine in Chile in September and a development decision is scheduled for the December quarter of 2012.
Managing director Gavin Thomas said the profit results highlighted underlying profitability at the Chatree and Challenger mines as the company continued to diversify and grow.
The expanded plant at Chatree would lead to an increase in gold production of between 120,000 and 130,000 ounces.
Production at the Challenger gold mine in fiscal 2013 is expected in the range of 80,000 ounces to 90,000 ounces, in line with 2012 production.
Earlier this month Kingsgate said it would take six months to turn around its underperforming Challenger gold mine, which it acquired in February 2011.
Kingsgate declared a final unfranked dividend of 10 cents per share. Kingsgate closed down 37 cents at $4.62.
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