Shares in Africa-focused Randgold Resources (LON:RSS) fell the most in four years Wednesday after it revealed its gold output for the first three months of the year fell 11% compared with the previous quarter due to “technical issues” at two of its mines.
Randgold closed almost 12% lower in London to 5,830p, as the company said it mined 291,912 ounces in the period down from 326,430 ounces in the last quarter of 2015, attributing the drop to issues at its Kibali mine in the Congo and its Tongon mine in Ivory Coast.
The drop in output did not affect profits — they climbed to $54.4 million or 13% higher than the same quarter last year.
The operational wrinkles were offset by steady production at its flagship Loulo-Gounkoto mine in Mali, Randgold said in the statement.
The drop in output did not, however, affect profits. The company, with operations in in Mali, Ivory Coast and DRC, reported first-quarter profit of $54.4 million, 13% higher than a year earlier. Sales increased 0.3% to $345.8 million.
As most bullion miners, Randgold is enjoying the benefits of a rally in gold prices, which have jumped 21% so far this year. Lower exploration spending and higher efficiency at the company’s operations also helped the miner boost results.
Randgold, one of the very few gold producers that kept its head above the water last year despite plummeting metal prices, has repeatedly touted its intention to acquire new assets to add to its four operating mines. But it has stuck rigidly to criteria about the size of return it wants and the amount of gold a mine must be capable of producing.
