PERTH (miningweekly.com) – Gold miner Ramelius Resources has seen production and revenue fall in the half-year ended December.

The miner reported that gold production in the six months under review reached 118 000 oz, down from the 132 605 oz produced in the first half of the 2022 financial year, with net profits after tax falling from A$73.4-million to A$32.7-million in the same period.

Earnings before interest, taxes, depreciation and amortisation (Ebitda) fell to A$101.1-million from A$187.7-million, while all-in sustaining costs increased from A$1 473/oz to A$2 044/oz.

Ramelius told shareholders that the financial results during the interim period were impacted by cost pressures across the business, lower grades at the Mt Magnet operation, as well as ongoing impacts on productivity as the company felt the effects of higher employee turnover and absenteeism from Covid-related illnesses.

Gold production at Mt Magnet was down against the previous corresponding period by around 12%, or 8 162 oz, owing to a lower head grade as the high-grade Shannon underground was largely completed and replaced with lower-grade feed from Hill 60. The grade profile at Mt Magnet is expected to increase in the second half of 2023 with the introduction of more feed from the high-grade Penny underground as the mine ramps up and the haulage rate increases as the road upgrade is completed in the March 2023 quarter.

At Edna May, production was down 10% or 6 443 oz owing mainly to lower throughput as the historic low-grade stockpiles at Edna May were largely exhausted. The lower throughput was mitigated somewhat with higher-grade material from the Tampia and Marda satellite pits.

“Notwithstanding a very challenging environment around costs and employee and contractor turnover, Ramelius still posted a very competitive set of underlying financial results. Our underlying Ebitda of A$106.3-million was down on the prior corresponding period, but the margin remained a very competitive 35% for the six months,” said MD Mark Zeptner.

“We believe this compares well with our peers and highlights that our business model remains robust. The first half of the year has been a period of investment for Ramelius as we look to bring one of the highest-grade gold mines in Australia into steady-state production early in 2023. Production from the Penny underground commenced late in 2022 and we expect this to ramp up in the March quarter as the mine is developed and the upgrade of the haul road to Mt Magnet is also completed. Penny should have a materially favourable impact on the unit costs and cash generation for the Mt Magnet production centre for the next two to three years.”