[dehai-news] (Proactive Inv.) Nevsun Resources says commercial copper expected by year-end, costs in line with forecasts as dividend increased

From: Semere Asmelash <semereasmelash_at_ymail.com_at_dehai.org>
Date: Wed, 7 Aug 2013 09:49:37 -0700 (PDT)

Nevsun Resources says commercial copper expected by year-end, costs in line with forecasts as dividend increased

12:00 pm by Deborah Bacal

Nevsun Resources (TSE:NSU)(NYSE MKT:NSU) reported Wednesday that its second quarter profit and revenues declined sharply on lower gold volumes and prices, as the company transitions to a majority copper producer, managing to keep costs in line with expectations despite the weaker metals environment and the capital-intensive project underway. It also announced an increase in its dividend, and said that it expects commercial copper output by the end of this year. 

For the three months that ended June 30, net income attributable to shareholders fell to $5.27 million, or 3 cents per share, compared to $39.57 million, or 19 cents per share, a year ago. 

Revenues shed to $54.79 million from $147.7 million a year earlier, as the company produced 34,900 ounces of gold, compared to 87,000 ounces in the second quarter of 2012, and sold 36,200 ounces, much lower than the 87,500 seen a year ago as it transitions to a copper producer. 

The Bisha mine in Eritrea, operated by Nevsun's 60-per-cent owned subsidiary Bisha Share Mining Company, is thought to be one of the highest grade open pit base metal deposits in the world and has a mine life in excess of 12 years.  The company said Wednesday the copper expansion project was completed on-time and under budget, with Nevsun just recently starting the processing of supergene copper, producing modest amounts of copper concentrate. It is forecasting production of 200 million pounds of copper in 2014. 

In the latest quarter, gold prices realized fell to $1,374 an ounce from $1,599 an ounce, while cash costs climbed to $692 per ounce of gold sold, from $253 a year earlier. 

"Q2 cash costs were managed to expectations helping Nevsun maintain a strong balance sheet despite the drop in metals prices and delivery of a significant capital expansion project," said president and CEO Cliff Davis. 

"With $384 million in working capital, including $343 million in cash, no debt, a superior deposit and a supportive partner in the Government of Eritrea, the company is well positioned for growth."

Shares of the company were lately up by 7 cents in Toronto, climbing to $3.23, just two pennies shy of its intraday high. So far this year, Nevsun's stock has shed 24%. 

"Bisha's exploration program is expected to bear fruit in early 2014 and Nevsun has been successful in managing acquisition opportunities so as not be pulled into low return, high-risk investments. That said, given the challenges in the mining market, we are optimistic about external growth opportunities," said Davis, adding that it is "great news" that the company is ahead of schedule on the copper plant commissioning. 

Nevsun also announced Wednesday a 40 per cent increase to its semi-annual dividend to 7 cents per share. 
v http://www.proactiveinvestors.com/companies/news/46900/nevsun-resources-says-commercial-copper-expected-by-year-end-costs-in-line-with-forecasts-as-dividend-increased-46900.html

Received on Wed Aug 07 2013 - 16:02:05 EDT

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