gold
34
08.13
R
andgold was well placed to sustain its prof-
itability, Bristow said, albeit not at the levels
achieved during the peak in the gold price.
“Our giant Kibali project is scheduled to start gold
production in October, Loulo and Gounkoto are both
accessing higher grade sections in their orebodies,
Tongon is continuing its turnaround and improved
efficiencies across the group have already cut our to-
tal cash cost per ounce by 5 % this past quarter. In
addition, projects are underway across the group to
increase throughput and recoveries and reduce unit
costs further,” he said.
Reflecting the turndown, the reduction of 17 % in
the average gold price received during the quarter to
June impacted on profit for the period, which came
down from US$81,6 million in Q1 to US$54,1 mil-
lion. Production of 196 207 ounces was in line with
that of the previous quarter.
Cash and cash equivalents on hand at the end
of the June quarter amounted to US$44,8 million
which, together with the recently negotiated revolv-
ing credit facility of US$200 million secured by the
company, meant it remained strongly positioned to
Randgold
undeterred
by flagging gold price
Above: A Liebherr 9350 300-t excavator working at the Kibali
mine in the north-east of the DRC. Randgold reports that the open-
pit mining contractor performed well during the quarter, exceed-
ing the monthly target of 1 million BCMs.
Right: The portals of the Kibali underground mine. At the end of
June, each decline had reached a project-to-date length of 550 m,
exceeding the planned advance by 33 %.
Increased production and reduced costs should enable Randgold Resources to remain profitable in the face
of a decreased gold price. Speaking recently at a presentation on Randgold’s results for the quarter ending 30
June, Chief Executive Mark Bristow noted that the company’s business model had been designed to deliver
returns at lower gold prices, and it had therefore not been forced to write down its reserves as these had been
calculated at US$1 000/oz. Randgold had, however, reviewed all its business plans at the beginning of the
year and where necessary aligned them to the drop in the gold price.
fund its growth projects, Bristow said.
Bristow noted that while Kibali, located in the
DRC, was now heading steadily to first production,
continued drilling had increased the total resources
there by 13 % to 21,5 million ounces (Moz). At the
Gounkoto underground project in Mali, drilling had
identified a high grade intersection which could ex-
pand the project. Incorporation of the new data in
the geological model would push the planned com-
pletion of the feasibility study out to 2014.
RCF initiative
The US$200 million unsecured revolving credit facil-
ity (RCF) negotiated on favourable terms by Randgold
during the past quarter, combined with the compa-
ny’s strong operational cash flows, will reinforce its
ability to implement its growth plans.
“We continually test our business plans against all
realistically foreseeable price scenarios and the RCF
initiative was born out of the strategic review we held
at the beginning of the year to ensure that these plans
were aligned with the lower gold price,” comments
company CFO Graham Shuttleworth. “While we be-
