JOHANNESBURG (miningweekly.com) – TSX-listed Dundee Precious Metals this week reported a half-year loss, widening from a net loss of $1.2-million in the first six months of 2015 to a net loss of $11.7-million during the first half of 2016.

The company attributed this in part to lower copper prices, higher local currency operating expenses and depreciation at the Tsumeb smelter, in Namibia, and higher general, administrative and exploration expenses.

Dundee’s basic loss per share widened from $0.01 apiece in the prior corresponding period to $0.08 a share in the half-year under review.

The net loss attributable to common shareholders from continuing operations in the first six months of 2016 was $12.7-million, swinging from net earnings of $300 000 in the corresponding period last year.

“Net loss attributable to common shareholders from continuing operations for the second quarter and first six months of 2016 was impacted on by several items not reflective of the company's underlying operating performance, including unrealised losses and gains attributable to hedging future copper and gold production, and foreign denominated operating costs and net gains or losses on Sabina special warrants,” the company added.

In the first six months of 2016, adjusted net loss from continuing operations was $8.7-million, compared with adjusted net earnings from continuing operations of $1.3-million.

Adjusted earnings before interest, taxes, depreciation and amortisation from continuing operations in the first six months of 2016 remained stable at $39.3-million.

PRODUCTION
In the first six months of 2016, Dundee produced gold contained in copper and pyrite concentrates of 84 910 oz, a 6% increase on the prior comparative period, while copper production increased 12% to 20.2-million pounds and silver production increased 7% to 119 252 oz.

“These increases were due primarily to higher volumes of ore mined and processed, higher recoveries for all metals and higher copper grades,” the company explained.

"Chelopech continues to perform well, and we expect to exceed the 2016 guidance we issued earlier this year. At Tsumeb, damage to the refractory lining following a power blackout in Namibia is expected to result in an unplanned three-week shutdown for repairs, and we now forecast 2016 concentrate smelted to be 20 000 t lower than anticipated," said Dundee president and CEO Rick Howes.

Tsumeb processed 101 967 t of complex concentrate during the six months under review, higher than the 96 822 t in the prior year.

Complex concentrate smelted in 2016 is now expected to range between 200 000 t and 220 000 t.

Meanwhile, lower realised copper prices led to an increase in the all-in sustaining cost per ounce of gold from continuing operations to $627/oz in the first half of 2016, up from the $498/oz achieved in the first half of 2015.

"Our focus for the balance of 2016 is to deliver on our production plans and initiatives to further optimise Chelopech and to maximise the Tsumeb smelter online time and capacity,” Howes noted.

Meanwhile, during the first six months of 2016, the volume of gold in copper and pyrite concentrates sold declined 4% to 69 618 oz, the copper in copper concentrate sold decreased 9% to 17.6-million pounds and silver in copper concentrate sales fell 24% to 75 501 oz.

Dundee had cash and cash equivalents of $23.8-million, an investment portfolio valued at $22.5-million and $160-million of undrawn lines under its committed long-term revolving credit facility, as at June 30.