Oceana’s earnings before tax from undesignated hedging, on gold and fuel, almost tripled, from $US56.4million a year ago to $US151.6million.Oceana at present has two mines in New Zealand and one each in the US and Philippines.
It has signed a "letter of intent" to go into a joint venture exploration-stage project in the southern Santa Cruz province of Argentina, with the possibility of taking a 75% stake for $US8.5million in cash and drilling costs.
Other changes include Oceana’s having decided on an annual dividend policy of an ordinary 2c-per-share dividend plus a discretionary annual payment.
Revenue for Oceana Gold in 2016 rose 23.7% to $US628.6million, earnings before interests, tax, depreciation and amortisation (ebitda) rose from $US193.4million to $US283.8million and after-tax profit was up from $US53million to $US136.4million.
Chief executive Mick Wilkes said the record profit was attributed to the higher ebitda, lower interest costs and gains from undesignated hedging; albeit the increase was partly offset by higher income tax, plus an $8million legal settlement is to be paid in El Salvador.
Gold sales of 401,350 ounces in 2015 were up almost 9% in 2016, to 437,146 ounces sold, with the price average up 8%.
Mr Wilkes said a "strong financial result" was achieved in 2016, with immediate liquidity of $US96.1million available, including $US68.9million in cash.
"With growth in production and higher margins expected in 2017, we are further strengthening our financial results and balance sheet," Mr Wilkes said.
He expected "significant growth opportunities" this year, with a new project at Waihi in the North Island and the Haile mine in South Carolina coming into production.
After drawing down $US30million in its revolving credit facility, at the end of 2016 it had a total of $US272.8million drawn from the $US300million facility.
In other statements, the company said it expected consolidated production to "increase significantly" in 2017, having already provided guidance targeting a production range of 550,000 ounces to 610,000 ounces. Production at Didipio in the northern Philippines remains under a cloud, but the mine is still operating after Oceana filed an appeal against a suspension order from the country’s Department of Environment and Natural Resources.
Oceana has 30 days from mid-February to file documents supporting its appeal, and can keep operating during that period. The environment department then has 15 days to respond, before the Office of the President, Rodrigo Duterte, rules on the matter.
