KEY POINTS:
Australian mining company OceanaGold, which has three gold mines in the South Island, has reported a loss of US$54.7 million ($108 million) for last year.
That compares with a US$63 million loss in 2007 and directors were proposing not to pay a dividend, it said yesterday in its report for the year to December.
The company warned it was looking to raise capital as balance sheet liabilities exceeded assets by US$43.4 million. The company also has capital commitments of US$6.6 million.
It has cash on hand of US$9.7 million and the cash flow projections showed the company could carry on as a going concern for another 12 months.
But if projections did not eventuate the company might not be able to meet its obligations. It said it was considering a number of options to raise capital.
OceanaGold operates mines at Macraes in Otago and Reefton in Buller, as well as a mine in the Philippines, which it has put into mothballs.
OceanaGold is listed on the Toronto, Australian and New Zealand sharemarkets.
This year its New Zealand share price has increased steadily from a low of about 22c in December to 97c before losing 22c yesterday to close at 75c.
OceanaGold's revenue last year more than doubled from US$104 million in 2007 to US$217 million. Earnings before interest, tax, depreciation and amortisation were US$66.1 million compared with $8.7 million in 2007.
The company achieved record gold sales totalling 74,816 ounces for the fourth quarter and 264,124 ounces for the 2008 year, an increase of 49 per cent.
The increase in production reflected the successful commissioning of the Reefton open pit and Frasers Underground mines in 2007 and last year.
Last year OceanaGold commissioned the Frasers underground mine at Macraes, which is expected to produce 55,000 to 65,000 ounces of gold a year.
After ramping up in the first quarter, the mine improved its performance and by the third quarter was running to plan.
The company now has three operations in New Zealand that combined are expected to produce between 280,000 and 300,000 ounces of gold this year.
OceanaGold said that last year it experienced unprecedented volatility with key consumable costs such as diesel and electricity in New Zealand.
The weaker dollar, which dropped from US81c in February to US57c at the end of the year, was a strong value driver for the New Zealand business as 70 to 80 per cent of the company's costs were denominated in NZ$ but revenues are based solely on US$ priced gold.
- NZPA
