Doray Minerals has posted a maiden half-year profit on the back of the commencement of production at its Andy Well gold project in the Murchison region.
Doray posted a $12.5 million net profit in the six months to December 2013, compared with a $2.2 million net loss in the previous corresponding period.
The Perth-based miner achieved its first gold pour from the project in August last year and went on to produce 37,694 ounces of gold over the course of the year.
It achieved an average received price of $1,494/oz, compared with cash operating costs of $470/oz and total production costs of $859/oz.
While Doray reduced its debt finance facility for the Andy Well project by about 24 per cent to $42 million over the period, it said it was in the process of restructuring the facility on more favourable terms.
The company also confirmed it has extended its hedging program as a safeguard against volatility in the gold price, with about 45 per cent of its forecast gold production from October this year to September 2015 sold foraward at $1,505/oz.
Doray managing director Allan Kelly said the results confirmed the company's status as a low-cost gold producer.
"The first six months of production have been very profitable for the company and this has allowed us to reduce our debt position substantially," he said.
"We are looking forward to bedding down production at Andy Well and conducting a substantial near-mine exploration program, which hopefully should translate into an increased resource and reserve base at Andy Well."
Doray shares were trading half a cent higher at $1.01 at 10:03am WST.
