Gold One confident on year-end metal target

[] — GOLD One International on Wednesday reported a 7% quarter-on-quarter drop in June quarter production to 12,287 ounces after a five-week strike at its Modder East operation.

Four weeks of the five-week strike by members of the National Union of Mineworkers occurred in the three months to end June, which contributed to only half a quarter of normal production.

Gold One president and CEO, Neal Froneman, said however the company’s 2010 gold production guidance of 85,000 to 100,000 ounces remained on track, with 25,000 ounces forecast for the September 2010 quarter.

Second quarter revenue was $14.8m and group cash operating costs were $6.6m, resulting in a group operating cash flow of $8.2m.

Development and capital expenditure for the quarter across the Modder East and
Sub Nigel projects was $8.3m.

Gold One ended the June quarter with $8.6m of cash on hand and gold pour receivables, compared to an end of March quarter cash balance of $8.9m.

Looking ahead, the company said the successful build up in production levels since
the strike has set the platform for continued ramp up at Modder East.

The company said it was confident of meeting its cost targets of less than $400
per ounce for the year, particularly given its cost performance in June.

A key milestone to be attained during the quarter ahead is the finalisation of the
agreement with Absa Capital and BNP Paribas relating to the $65m debt

The company said it would also be undertaking updates on resources and reserves
of all of its major projects during the September and December quarters.

“With continued ramp up at Modder East and the progression of our project pipeline, the company continues to be well positioned for growth and to deliver on our strategic objectives,” said Froneman.