Profits At Centamin PLC Hit By Falling Price Of Gold

Shares in Centamin (LSE: CEY) fell by more than 3.5% in early trade, following the release of its results for the quarter ended 30 September 2013.

Despite gold production in Q3 increasing 39% on the comparative period in 2012, at 84,757 ounces it is 9% down against Q2 2013.

Due to the price of gold bullion dropping, earnings per share fell markedly as well (to 2.72 cents), down 51% on Q3 2012 (5.53 cents) and 43% on the previous quarter this year (4.75 cents).

Management confirmed that the cost of production remains in line with the full-year guidance of S$700 per ounce, currently converting at $693 per ounce, though operations are “well placed to exceed full year 2013 guidance… of 320,000 ounces”.

Centamin also revealed $11.9 million write down in relation to the investment in Nyota Minerals, further trimming its stake to 14.4% in the Ethiopia-focused gold mine developer. However, today’s statement went on to say: “Exploration results at [Centamin’s Egyptian gold mine] Sukari and in Ethiopia continue to justify further drilling”.

Chairman Josef El-Raghy commented:

“The third quarter saw another strong performance on several fronts, most notably a further increase in both tonnes mined from underground and total process plant throughput. Whilst we expect some impact in Q4 on plant throughput from the commencement of Stage 4 commissioning activities, we are now well placed to exceed our initial full year 2013 guidance of 320,000 ounces, provided on 14 March 2013.”

If you are looking for more reliable investing opportunities, though, then this exclusive wealth report reviews five particularly attractive alternatives.

All five of these blue-chip companies offer a mix of robust prospects, illustrious histories and dependable dividends. The report is completely free, but will only remain available for a limited time -- simply click here to get it sent to your inbox immediately.

> Sam does not own shares in Centamin.