Gold miner Centamin Egypt (CEY) has said its operations have escaped unscathed by the political unrest which is gathering pace in Egypt.
The FTSE 250-listed group used its fourth-quarter results as an opportunity to assure markets that recent political events have not affected the safety of the company’s employees or its day to day operations at its flagship Sukari project.
“The company looks forward to a speedy resolution to the current uncertainty and remains confident that such resolution will not negatively impact on the company’s investment,” it said.
Centamin’s statement came after Egypt-focused stocks found themselves thrust into the spotlight as protestors fight to end the 30-year rule of President Hosni Mubarek.
Renaissance Capital said in a note: “All this is much needed good news from Centamin whose share price is at the mercy of the political situation in Egypt.”
Further good news for the shareholders came in the form of record quarterly gold production of 53,189 ounces from the company’s Sukari Gold Mine, with output averaging over 20,000 ounces per month in November and December.
The company attributed higher process plant throughput for the stronger quarterly figures, following the introduction of the SAG mill steel liner and lifter system in early November.
“The two consecutive months of record gold production in November and December demonstrate the deliverability of a substantially higher production profile in 2011 with our existing operations,” said chairman Josef El-Raghy.
Looking ahead, Centamin is targeting 2011 production in the range of 250-290,000 ounce with average cash costs of $450 per ounce, although this is slightly lower than previous guidance of 300 ounces.
Daniel Lian, research analyst at Bank of America Merrill Lynch, said: “Our sense is that the new guidance is very much on the conservative side, given that 2010 was impacted by unexpected ramp-up issues. We believe the risk to this guidance is to the upside, especially once the company completes the reserve update and scoping study mid-year.”
Lian maintained a ‘buy’ recommendation with a price target of 300p.