Hambro posts surprise gain in gold output

City A.M. Reporter
PETER Hambro Mining yesterday said its gold production jumped 54 per cent in the first half and noted that output, which is traditionally higher in the second half, will be boosted by one of its biggest mines, the Pioneer deposit.<br /><br />The second-biggest gold producer in Russia said its output rose to about 222,600 ounces. The company had said it expected annual production to be at the upper end of its 460,000-510,000 ounce target, implying second-half output of around 290,000 ounces, which would make it the largest UK-listed gold producer by output.<br /><br />Shares in the company, which moved up to the FTSE 250 in April following the acquisition of iron ore producer Aricom, finished up five per centat 626.5p, valuing the group at about &pound;1.07bn.<br /><br />&ldquo;The results are positive, with the prospects of a seasonably stronger H2 and the contribution of the second phase ramp up at Pioneer, there may even be some upward revisions in the full-year production expectations,&rdquo; said Arbuthnot Securities. However, the broker said it was concerned about the group's non-mining costs and long-term growth profile.<br /><br />Peter Hambro said unit costs at the Pokrovskiy and Pioneer deposits for the first half were in line with its internal forecasts but declined to provide figures.<br /><br />Chairman Peter Hambro said: &ldquo;We have remained resolute in our efforts to manage costs and guard our position as a low cost producer and I am pleased to report a solid performance in this respect.&rdquo;