Asanko returns to profitability after improved production quarter

Asanko Gold Mine, Ghana

ASANKO Gold, the Ghana-based company in which Gold Fields has acquired a 9.9% stake, produced net income of $2.2m in the first quarter of its 2018 financial year representing an improvement on the $7.1m loss in the prior quarter, but well off the $7.7m profit generated in the first quarter of the previous financial year.

Asanko Gold operates the Asanko gold mine in which Gold Fields also bought a 50% stake. Including the acquisition of shares in the company, achieved through subscription of $17m worth of shares in a rights issue, Gold Fields has invested a total of $202m in the company and the mine. It described the deal, unveiled in March, as “… demonstrably accretive”.

First quarter production totalled 48,229 ounces which was in line with guidance for the first half of the firm’s 2018 which was between 90,000 to 100,000 oz. Gold sales totalled $64.2m after an average realised price of $1,314 per ounce. “The mine’s strong operational performance was mirrored in the financial results for the quarter as we returned to profitability,” said Peter Breese, president and CEO of Asanko.

Commenting on the transaction with Gold Fields, Breese said the company would continue to operate and manage the mine which was “… a great vote of confidence in both the quality of the asset as well as the management team”. The Gold Fields deal was “… progressing well and we remain on track for closing before the end of the third quarter 2018,” he said in notes to the firm’s published results.