CNMC Goldmine profit down 2.5% for Q4

An aerial view of one part of the CNMC goldmine in Kelantan.
An aerial view of one part of the CNMC goldmine in Kelantan.PHOTO: BT

SINGAPORE - CNMC Goldmine made a net profit of US$1.25 million for the fourth quarter, down 2.5 per cent from US$1.29 million for the same period a year earlier as unrealised foreign-exchange losses, expenses for a failed Hong Kong dual listing, and higher tax expenses offset a surge in production.

Revenue for the three months ended Dec 31 surged about 2.6 times to US$12.6 million as sales volume of fine gold swelled to 10,198 ounces from 3,619 ounces for the fourth quarter of 2017.

However, the average realised gold price fell to US$1,236 per ounce, from US$1,343 per ounce for the fourth quarter of 2017.

All-in costs of production decreased to US$945 per ounce, from US$1,236 per ounce for the fourth quarter of 2017, owing to higher sales volume of fine gold, and partly offset by higher general and administrative costs, and capital expenditure in non-sustaining operation, the group said.

Net profit margin narrowed to 15.5 per cent from 33.3 per cent for the fourth quarter of 2017.

Fourth-quarter earnings per share was 0.42 cent, down from 0.44 cent for the fourth quarter of 2017.

A final dividend of S$0.002 per share was proposed, unchanged from 2017.

Net asset value per share was 13.94 cents as at end 2018, up from 13.29 cents as at end 2017.

For the 2018 full year, net profit slipped 39.5 per cent to US$1.68 million, as listing expenses, a reversal of Pulai's tax penalty estimate and other one-off items offset a surge in gold production to an all-time high.

Revenue for the 12 months ended Dec 31 reached a record US$39.5 million, almost doubled from 2017's US$19.2 million.

Driving the output increase was CNMC's carbon-in-leach (CIL) plant, which began commercial production in May last year, it said. Used for processing higher-grade ore, the CIL plant is one of three production plants at CNMC's Sokor gold field in Malaysia's Kelantan state.

Total dual listing expenses for 2018 amounted to US$1.99 million. In December last year, CNMC was formally notified by the Hong Kong stock exchange's listing committee that it was not suitable for a dual primary listing on the main board. CNMC said it will re-evaluate its options.

A final dividend of $0.002 per share was proposed, unchanged from 2017.

Net asset value per share was 13.94 cents as at end 2018, up from 13.29 cents as at end 2017.

Chief executive officer Chris Lim said: "We delivered in 2018 what we could not in the previous year, when we had to endure a lull in gold production due to low ore grades, because we were planning and constructing our CIL plant to process higher grade ore. While output reached a record high in 2018, we will endeavour to continue to expand gold resources at Sokor through ongoing exploration so as to support our planned increase in gold production."

The shares added one cent or 4.55 per cent to trade at $0.23 as at 9.43am after the results were announced on Wednesday morning.