Tanzanian gold miner Acacia Mining’s net earnings for the first half of this year, ended June 30, decreased by 51% to $30.9-million, compared with the net earnings of $62.5-million recorded in the first half of 2017.
Net earnings were impacted on by a $24.2-million impairment at Nyanzaga mine.
Post-period end, OreCorp Tanzania completed its earn-in obligations in respect of the Nyanzaga project in accordance with the earn-in agreement it entered into in 2015.
As a result, OreCorp is executing its option under the agreement to move to 51% ownership in the project through a $3-million payment to Acacia.
Acacia believes a simplified ownership structure of the project will be beneficial to the future development of the project and will best enable it to provide benefits to Tanzania.
OreCorp and Acacia have also signed an agreement for a further payment of $7-million from OreCorp to acquire 100% ownership of the project.
Acacia will retain a net smelter return production royalty capped at $15-million.
Meanwhile, Acacia’s earnings before interest, taxes, depreciation and amortisation (Ebitda) for the six months were $133.6-million, which is 17% down from the first half of 2017, while adjusted Ebitda of $91.6-million is 45% lower than the first half of 2017.
Meanwhile, Acacia produced 254 759 oz of gold across the group at an all-in sustaining cost (AISC) of $945/oz.
This production is 41% lower than that of the first half of 2017.
Acacia interim CEO Peter Geleta on Friday reiterated that changes made to the business in late 2017 have delivered the desired results, helping to return the company to free cash generation for the first time since the fourth quarter of 2016.
Acacia is on track to reach its full-year production guidance of between 435 000 oz and 475 000 oz at an AISC of between $935/oz and $985/oz.