Ashanti boosted by Iraq

Fears over war with Iraq helped boost Ashanti Goldfields' third-quarter profits by 55%.

Net profits rose to $22.5 million from $14.5 million.

Turnover grew to $141.2 million, up from $136.2 million.

Fears of a US-led attack on Iraq has spurred investors to buy bullion, traditionally seen as a store of value in unpredictable times.

The company also said it had paid $33 million of its credit facility.

Ashanti Goldfields Q3 earnings up 55 pct but gold production down

LONDON (AFX) - Ashanti Goldfields Co Ltd said it recorded unaudited earnings of 22.5 mln usd during the third quarter 2002.

This was a 55 pct improvement over the corresponding period last year, achieved principally through higher spot prices, lower interest charges and write-back of certain tax provisions no longer required.

Earnings per share for the quarter, after taking into account warrants that were exercised as part of the refinancing, was 18 cents against 13 cents.

During the quarter, Ashanti effected a significant reduction in its floating lease rate exposure to its hedge book.

The total floating lease rate exposure was reduced by 1.6 mln ounces from 4.38 mln ounces to 2.78 mln ounces.

Ashanti also paid down 33.0 mln usd of its revolving credit facility, reducing the amounts drawn to 157.0 mln usd as at Sept 30 2002.

It added it is is actively pursuing expansion programmes at three of its mine sites.

These are Geita in Tanzania, Iduapriem/Teberebie in Ghana and Siguiri in Guinea.

In the third quarter, Ashanti achieved gold production of 407,328 ounces, slightly lower than the 411,532 ounces achieved in the same period last year. This resulted from difficult mining conditions caused by heavy rainfall at its heap leach operation in Siguiri, coupled with a combination of lower than planned mill grades and lower metallurgical recovery at Obuasi.