Low Price Of Gold Hits Earnings At Centamin PLC

… despite record gold production at Centamin PLC’s (LON:CEY) Sukari mine in Egypt.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Shares in Centamin (LSE: CEY) fell over 4% in early trade this morning, despite positive results from the second quarter and first half of the year.

The drop comes after the price of gold continued to fall, which affected earnings per share to the tune of 28%, dropping to 4.75 cents from 6.60 cents per share in Q1 2013.

However, the gold-mining company once more saw record gold production at 93,624 ounces in the Sukari mine, a rise of 8% compared to the first quarter of the year and an increase of 39% against Q2 2012.

Chairman Josef El-Raghy commented:

“The second quarter saw continued improvements in mining and processing productivity at the Sukari operation which, combined with average grades in line with the mine plan, delivered a third successive quarter of record output.

“With commissioning activities likely to see reduced throughput in Q4 and the benefit of additional Stage 4 throughput to be seen in 2014 our full year guidance of 320,000 ounces remains unchanged.”

Investors weren’t given any further news on the Supreme Administrative Court appeal and Diesel Fuel Court Case, both described as “ongoing”.

If the results of these are favourable to Centamin, though, and the price of gold takes a positive turn, then the shares at today’s price of around 37p could provide a bargain for adventurous growth investors.

Indeed, you may wish to consult this free Motley Fool report, which explains how betting on battered shares can provide wonderful gains… if the underlying company recovers. To put a possible turnaround into perspective, Centamin’s shares reached a peak of 197p before the Egyptian troubles erupted.

Anyway, if Centamin is tempting you today, please click here to read the Fool’s exclusive ‘millionaire’ report before you hit the ‘buy’ button.

> Sam does not own any share mentioned in this article.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

More on Company Comment

Hand of person putting wood cube block with word VALUE on wooden table
Company Comment

Value has been building behind the Diageo share price

Despite the business growing, the Diageo share price first reached its current level just over 19 months ago and hasn't…

Read more »

Older couple walking in park
Investing Articles

5 stocks to buy for high and rising dividend income

I can see a host of shares to buy on the FTSE 100 offering me exceptional levels of income. Here…

Read more »

Young mixed-race woman looking out of the window with a look of consternation on her face
Investing Articles

I don’t care if FTSE 100 shares fall further, I’m buying them today

I'm happy to go shopping for FTSE 100 shares today, even though I accept that they could have further to…

Read more »

Happy young female stock-picker in a cafe
Investing Articles

Rolls-Royce shares are down 18% in a month and I’m finally going to buy them

Investors who bought Rolls-Royce shares have been repeatedly disappointed, but I'm willing to take a chance on them before they…

Read more »

Storytelling image of a multiethnic senior couple in love - Elderly married couple dating outdoors, love emotions and feelings
Investing Articles

How I’d invest £10k in a Stocks and Shares ISA today

Now looks like a good time to buy cheap FTSE 100 shares inside a Stocks and Shares ISA. These are…

Read more »

Black father holding daughter in a field of cows
Investing Articles

Today’s financial crisis is the perfect moment to buy cheap shares

I'm building a portfolio of FTSE 100 stocks by purchasing cheap shares whenever I see an opportunity. There's a good…

Read more »

Long-term vs short-term investing concept on a staircase
Investing Articles

I’d buy Tesco shares in October to bag their 5.4% yield 

Tesco shares have fallen lately but I think this makes them attractively valued for a dividend stock I would aim…

Read more »

Young mixed-race woman looking out of the window with a look of consternation on her face
Investing Articles

I would do anything to hold Diageo in my portfolio (but I won’t do that)

Diageo is one of my favourite stocks on the entire FTSE 100 and I'd love to hold it, but one…

Read more »