PERTH (miningweekly.com) – Falling metals prices have eaten into copper/gold miner PanAust’s revenue for 2014, despite record copper and silver production in the year ended December.

Sales revenue declined to $678.8-million, from $725-million in the previous financial year, while copper, gold and silver production exceeded the firm’s guidance.

The miner produced 71 155 t of copper-in-concentrate, 168 755 oz of gold-in-concentrate and 1.27-million ounces of silver.

PanAust on Thursday cited weaker commodity prices for the $264.7-million impairment charge reported in the year, which pushed the miner into a full-year loss of $221.4-million, compared with $43.7-million in after-tax profit in 2013.

MD Fred Hess said that the company’s operations were well established and that they performed consistently in line with plan, which boosted the company confidence in its future.

“PanAust has a clear strategy which is focused on maximising the returns from its production assets while advancing the Frieda River copper/gold feasibility study. The study is expected to be completed by 2015 year-end, and to be funded from cash flow from operations.”

Hess noted that copper production from the Phu Kham operation, in Laos, was expected to rise over the next several years and peak at 90 000 t in 2018 and 2019, as grades improved.

“This increase, together with a declining strip ratio from 2016 onwards, is expected to enhance cash flow during the anticipated lead-up to development of the Frieda River project.”

Meanwhile, a business efficiency review, which started in November last year, has also resulted in operating and capital cost savings of about $50-million, Hess reported.

“These expenditure improvements have been incorporated into guidance for 2015 and further opportunities continue to be pursued. The PanAust business is now better positioned to be competitive throughout the full copper price cycle.

“Disappointingly, the measures undertaken were validated almost immediately by the extreme copper price volatility experienced during January 2015.”

Looking ahead, PanAust expected production to rise to between 73 000 t and 76 000 t of copper-in-concentrate during 2015, while precious metals production would reach between 175 000 oz and 183 000 oz of gold, and between 1.3-million and 1.4-million ounces of silver.