Saracen shares dip despite profit growth

Saracen Mineral Holdings has announced a 17 per cent profit rise, but its shares closed nearly 10 per cent lower.

The gold miner posted an underlying net profit after tax of $43.5 million for the first half of this financial year compared to $37.2 million in the previous corresponding period.

The underlying figure took into account Saracen’s $10.6 million profit from its sale of the King of the Hills mine near Leonora to Red 5.

Its gold sales revenue surged 15 per cent, to $281.9 million for the six months to the end of 2018.

Its all-in sustaining costs fell 6 per cent to $1,030 per ounce.

Despite the revenue increase and cost reduction, its earnings before interest and tax depreciation and amortisation only rose 1 per cent to $104.1 million, and its net profit before tax fell 7 per cent to $61.2 million.

Managing director Raleigh Finlayson said the results were “strong” and the company wanted to continue the momentum in the future.

“We are investing record amounts in ongoing exploration to drive further increases in our inventories, mine lives, production and cashflows,” Mr Finlayson said.

Shares in Saracen fell 9.63 per cent to close trade at $2.91.