Oceana Gold - as forecast - has booked a downturn in gold sales of more than 10% for the calendar year 2010 and its crucial cash costs have begun rising, as predicted.
Oceana is coming off a stellar period, with its share price down almost 40% on a record high last year and it has predicted production costs could rise 57% to 67% this calendar year.
Analysts have predicted a tough year ahead for Oceana, as it grapples with delivering an increase of lower grade ore, less gold production and mounting production costs - but all of which are cushioned by strong spot prices, at present, and recent successes raising a total $NZ260.9 million in capital.
Yesterday's announcement saw Oceana shares soften from opening at $3.44, to trade down to $3.39.
In its unaudited accounts for the fourth quarter to December last year, Oceana sold 68,027 ounces from its Macraes and Reefton mines for the quarter, which contributed to a total 268,087 ounces sold for the calendar year.
"This was 10.6% lower than the full year 2009 and slightly below expectations for the year," Oceana said.
Unaudited cash costs were $US596 per ounce for the December quarter and $US570 for the full year, which is within previous full-year guidance, but up 38% on last year's $US411.
Oceana has previously advised if cash costs are up 67% this year as forecast, it would cost about $US685 per ounce to produce.
Oceana's revenue for the fourth quarter was $US93.8 million, based on an average gold price of $US1379 per ounce while operational expenditure for the quarter was $US39.9 million, excluding depreciation, amortisation and general and administrative expenses.
Exploration costs at both Macraes and Reefton for the quarter were $US3.3 million.
