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General News of Saturday, 23 June 2018

Source: adomonline.com

GSR reports higher after tax loss in first quarter

Golden Star Resources (GSR), a gold mining company that owns and operates the Wassa and Prestea mines in Ghana saw its after tax loss rise from $ 250,000 in Q1-2017 to $395,000 in Q1-2018. The company’s gold revenues increased from $68.55 million in Q1-2017 to $70.82 million in Q1-2018.

The rise in the company’s revenues was driven by a rise in gold prices in the first quarter of the year given that its gold production was slightly lower in Q1-2018 compared to Q1-2017. GSR’s mine operating margins could not sufficiently cover its operating costs despite achieving a significant reduction in its general and administrative costs which declined from $7.99 million in Q1-2017 to $1.11 million in Q1-2018. The rise in profit before tax reported for the period stemmed from an increase in gains on fair value financial instruments which rose from $2.50 million in Q1-2017 to $ 5.4 million in Q1-2018. A deferred income tax expense of $ 2.89 million in Q1-2018 turned its income to a loss.

GSR intends to concentrate its operations on high margin, underground ore in the bid to increase shareholder’s value. The rise in the production rate of its Prestea Underground mine in April 2018 is expected to impact positively on its financial performance in Q2-2018. In terms of share price performance, GSR share price on the local bourse has remained stable at GHS 1.90 with minimal trading activity.

It is anticipated that GSR’s share price will most likely remain steady in the coming months riding on the back of its current performance and low levels of stock liquidity.

The Composite Index at the end of yesterday’s trade gained 1.24 points to peg at a YTD return of 13.63%. The Financial stocks index, on the other hand, shed off 2.4 points to peg at a YTD return of 14.60%. There were 2 losers [GCB & CAL] and 1 gainer [GOIL]. GOIL topped the charts in terms of volumes as 100,700 shares worth GHS 402,618 changed hands.

On the Ghana Alternative Market

Trading on the Ghana alternative Market was hushed as no shares changed hands.

On the Currency market

The Cedi depreciated marginally against the Euro, the British Pound but lost Dollar at the end of yesterday’s trade. The local currency exchanged at a mid-rate of GHS 4.4645 to the USD, GHS 5.8880 to the GBP and GHS 5.1701 to the EURO. The GCFM Cedi index, a measure of the holistic performance of the Cedi on the interbank market now records a year-to-date appreciation of 0.39%.