Golden quarter for Saracen

Shares in gold producer Saracen Mineral Holdings were up 14 per cent today after the company's December quarterly report revealed strong production, lower costs and improved cash flow generation.

The company said its gold production was 16 per cent above guidance, coming at a record 42,894 ounces.

This was driven by increased production at its Red October operation at more than 21,500oz.

The company said it was on track to achieve the upper end of full-year production guidance, which was 145,000oz-155,000oz, with an all-in sustaining cost of $1,539 an ounce.

Saracen managing director Raleigh Finlayson said it was a strong performance in mine production and safety.

“On the back of record operational cash flow generation we have been able to aggressively pursue our extensive exploration and development programs across our operations,” he said.

“We are very encouraged by the early indications from these efforts.”

Western Australian gold producers have been under pressure in recent months as the US dollar value of gold slides, but the fall in the Australian currency has alleviated some of the pain.

Saracen closed at 40.5 cents per share, after peaking at nearly 50 cents in July.