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Centamin says Q4 output rose 10 per cent on Egypt project Gold producer sees overall output climb thanks to showpiece Sukari mine in the Eastern Desert
Gold producer Centamin posted a 10 per cent rise in fourth-quarter output, boosted by higher production rates at its flagship Sukari project in Egypt, lifting its shares on Tuesday. Egypt-focused Centamin was hit in the second quarter by local restrictions on blasting, which, along with supply disruptions in the first quarter, forced the company to reduce its 2011 production guidance to 200,000-210,000 ounces. The miner said it produced 58,965 ounces in the fourth quarter of 2011, taking full-year gold production to 202,698 ounces, up 35 per cent. Analysts said the update was a positive catalyst for a stock down over 40 per cent in value from early August, when the miner detailed its weak second quarter. The shares are currently trading at 4.1 times EV/EBITDA, making it the cheapest UK gold producer, according to Liberum Capital. "Whilst sovereign risk fears are likely to dominate the stock until Egypt's election outcome is known, Centamin's remote location means it is operating uninterrupted and therefore a relief rally in 2012 could offer the highest upside of all the UK gold names," Liberum analysts said in a research note. Sukari, the first modern gold mine in Egypt, is in the Eastern Desert, some 25 km from the Red Sea coast. At 0900 GMT, shares were up 3.2 per cent at 83.4 pence, outperforming a more than 2 per cent rise in the sector.
