PERTH (miningweekly.com) – Africa-focused gold miner Resolute Mining has warned of a non-cash impairment charge in the range of between $165-million and $175-million for its 2021 half-year results.
The impairment charge follows an assessment of the company’s cash generating units, and the impairment expected to be recognised relates solely to the Syama mine, in Mali.
The impairment charge is as a result of a number of issues, including lower assumed gold prices which reflected a 5% to 10% reduction in the short- to medium-term compared with the assessment carried out in December, an increase in the risk-free rate which underpins the applicable weighted average cost of capital used in the impairment assessment, and a revision of the 2021 production and cost guidance for Syama.
“Our focus remains on operational resilience, generating free cash flows and strengthening Resolute’s balance sheet. We have made significant changes in 2021 with an emphasis on people, process and systems which we believe will drive improvements to our production, cost and ultimately cashflow generation,” said MD and CEO Stuart Gale.
There is no impact to Resolute’s mine plans, gold reserves and resources, and existing debt covenants.
The financial results are due for release on August 27.