Aim-listed Highland Gold on Tuesday posted net profit of $28.6-million in the first half of the year, a 10% increase on the prior-year period, despite flat revenue and lower metal sales.

Revenue came in at $146.9-million, despite metal sales falling from $128.5-million in the first half of 2017, to $121.2-million in the six months under review.

Earnings before interest, taxes, depreciation and amortisation (Ebitda) reduced from $73.2-million to $71.4-million and the Ebitda margin dipped from 50% to 49%. The lower Ebitda was mainly as a result of increased administrative expenses, Highland reported.

The Russia-focused company produced 128 921 oz of gold and gold equivalent in the first half of the year from its Mnogovershinnoye (MNV), Novoshirokinskoye (Novo) and Belaya Gora mines. The output was 2.2% less than what was produced in the first half of 2017.

Higher administrative expenses and higher maintenance capital expenditure pushed up all-in sustaining costs to $697/oz, from $674/oz in the first half of 2017.

The debt to Ebitda ratio was stable at 1.23 times at the end of June 2018, compared with 1.28 times at the end of December, when net debt was $198.3-million.

“During the half, we continued efforts to identify and study new resources in and around existing operations at MNV, which are expected to culminate in a new reserve report due this autumn and an extension of life-of-mine. Stage 1 of the Novo capacity expansion is under way. Additionally, we published a prefeasibility study for Belaya Gora and Blagodatnoye which shows the way forward for that project, and a definitive feasibility study for our premier development project Kekura, where initial infrastructure construction is in progress,” said CEO Denis Alexandrov.

The company reaffirmed its forecast for total production of gold and gold equivalent of 265 000 oz to 275 000 oz for the full year.