Mount Gibson posts record half-year sales

Mount Gibson Iron has achieved record half-year iron ore sales despite posting softer sales results during the December quarter.

Mount Gibson sold 5.1 million wet metric tonnes of ore from its Koolan Island, Extension Hill and Tallering Peak mines in the six months to December, leaving the company on track to achieve its sales guidance of 9Mwmt-9.5Mwmt for the 2014 financial year. 

The Perth-based miner sold 2.49Mwmt of ore from its Koolan Island, Extension Hill and Tallering Peak mines in the three months to December, down from 2.59Mwmt the previous quarter.

The company said production for the quarter had been affected by reduced fleet availability and temporary flooding of the main pit ore zone at Koolan Island related to Cyclone Christine in late December.

Average unit cash mining costs for the quarter remained within guidance of $8-$10 per tonne moved, despite these interruptions.

Mount Gibson's Extension Hill and Tallering Peak mines in the Mid West performed slightly better than the previous quarter, with sales of about 1.6Mwmt.

Mount Gibson chief executive Jim Beyer said the company had delivered an excellent performance in the first half of FY14.

"The first half of the year has proven to be an excellent one for cash generation, reflecting very strong sales, firm iron ore pricing and our ongoing efforts to increase productivity and reduce costs," he said.

"Of equal satisfaction was the increase in our total reported ore reserves, which has added mine life and business value and the green shoots of growth now emerging from our strategy to expand our exploration footprint and develop prospective ground around our existing assets in the Mid West and at Koolan Island."

Mount Gibson signed an agreement last month to purchase Gindalbie Metals' Shine hematite iron prospect for $15 million as it works to lift its Mid West reserves.

Shares in Mount Gibson closed the day's trade 3.5 per cent higher at $1.02.