London-based Goldplat Plc’s Kenyan subsidiary Kilimapesa sold gold worth Sh375.1 million in the six months ended December, boosted by increased production at its Migori plant.
Kilimapesa’s output rose 2.2 times to 2,681 ounces in the period compared to 1,190 ounces a year earlier, the multinational disclosed in regulatory filings. The company’s gold sales rose 2.4 times to 2,720 ounces from 1,093 ounces, placing the value of the commodity sold in the review period at Sh375.1 million based on the present international price of $1,348.1 per ounce.
The royalty rate the company pays to the Kenyan government was not immediately clear but the State is likely to book more revenues from the increase in exports.
“I believe we are well-placed for the positive full year 2018. Management is committed to achieving profitability at Kilimapesa during this financial year and I am confident that we will succeed,” Gerard Kisbey-Green, CEO of Goldplat said in a statement.
“Furthermore, we continue to make positive progress at our recovery operations, both in terms of increasing operational capacity and in identifying new sources of material for processing at an international level.”
The multinational says Kilimapesa suffered lost production between October and December as election-related political unrest disrupted diesel supplies besides problems relating to the importing of critical parts for the primary crusher.
The company added that it installed a second diesel generator at the second phase of the plant to provide additional power for the mill to increase the overall production throughput.
“Kilimapesa remains on target to produce 5,800 oz (ounce) of gold in the full year 2018, despite the previous quarter’s loss in production,” Goldplat said.
The multinational has invested more than Sh30 million to increase production in its Kenyan operations over the past two years, signaling its confidence about gold’s future prospects.
The price of gold touched highs of $1,833 (Sh188,000) per ounce in September 2011 as investors rushed to buy the commodity in the aftermath of the global financial crisis which eroded the value of currency-based assets.
Its price subsequently dropped to trade at the current $1,348.1 (Sh138,000) per ounce as fears of recession subsided.