ASANKO Gold, the Toronto-listed company in joint venture with Gold Fields, swung into profit in the second quarter and said it was positioned for cash flow generation given that major capital commitments were unlikely in the short-term.
“With limited capital expenditure planned in the near term, we expect to see the benefits of the Cut 2 pushback at Nkran positively impact all-in sustaining costs during the last quarter in the year,” said Craig McCunn, CEO of Asanko Gold in the firm’s second quarter report.
Nkran is part of the Ghana-based Asanko Gold Mines which Asanko Gold shares in joint venture with Gold Fields, the Johannesburg-based firm.
On the back of previously reported record second quarter production of 62,067 ounces, Asanko Gold posted positive earnings before interest, tax, depreciation and amortisation (EBITDA) of $35.2m and operating cash flows before working capital changes of $35.3m. Net income after tax of $13.6m.
McCunn said the company was working with Gold Fields to produce a new mineral reserve estimate for Asanko Gold Mine that was not predicated on significant capital investment.
“At this stage, we do not anticipate that the updated mineral reserve estimate will be based on any major capital investments such as further processing plant expansions or Esaase ore transportation infrastructure,” said McCunn. “Future capital investments will be measured against their return on invested capital based on this updated plan,” he said.