Oz Minerals expects up to A$240m impairment charge
PERTH (miningweekly.com) – The share price of metals miner Oz Minerals declined on Monday as the company announced an impairment charge of between A$200-million and A$240-million for is Prominent Hill asset.
The miner told shareholders that the anticipated asset impairment had resulted from a combination of factors, including the lower-than-expected copper and gold prices and the weaker exchange rate.
The impairment was also owing to higher asset values after Oz invested capital in developing the new Malu underground mine and conducted work to remediate the south wall overburden slip in the openpit operation.
As a result, the carrying value of the assets at the end of June were estimated at between A$1.58-billion and A$1.62-billion, prior to impairment.
Oz noted that the impairment assessment had also considered further work on the development concepts for the potential new Malu underground mine, leading to improved confidence of its expected value.
This work was ongoing and would only be completed later this year.
Oz’s shares were down 3.4% on Monday, to trade at a low of A$3.99 a share, from Friday’s closing price of A$4.13 a share. By late afternoon, the stock fetched A$4.04 apiece.
Earlier this month, Oz lowered its gold production forecast for the full year to between 120 000 oz and 130 000 oz, while copper production for the full year was expected to be between 82 000 t and 88 000 t.
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