Eldorado Gold Corp (USA)(NYSE:EGO) stated that gold production in 2Q2016 came at 124,110 ounces compared to 181,160 ounces in the same period, a year earlier. Average cash operating cost was $607 per ounce against $569 per ounce in 2Q2015. Paul Wright, the CEO and President said that quarterly production came as per the projected targets. They are anticipating producing 570,000 ounces of gold in sustaining cash price of $930 per ounce.
The management speaks
The CEO of Eldorado said that development operation at Skouries is progressing following the Technical Study agreement in May. The Olympias Phase 2 development moves forward as per planned schedule and preliminary production is projected in 1Q2017. During the quarter, the company reported the sale of Chinese assets, explicitly the Jinfeng, Tanjianshan mines, the Eastern Dragon and White Mountain project.
The two deals, anticipated closing in 3Q2016 and 4Q2016, will help to improve balance sheet, which in turn will allow the management to re-invest in internal project pipeline and achieve growth. Adjusted net earnings for 2Q2016 came at $11.7 million against $17 million reported in 2Q2015.
The future ahead
Eldorado reported that gold production for FY2016 is expected to come at 570,000 ounces with average cash prices for commercial production at $595 per ounce. Previous guidance of gold production stood at 565,000 – 630,000 ounces with average cash prices for production to be in a range of $585 to $620 per ounce.
Capital spending is expected to be $95 million in sustaining capital compared with initial projection of $105 million. The new project advancement capital came at $250 million against previous guidance of $235 million. This change in projection is primarily due to estimated increased capital spending at Skouries after the approval of the latest technical study in 2Q2016 and the recommencement of construction plans at site.