Published: 24 June 2014

ZIMBABWE Stock Exchange-listed firm Falcon Gold said revenue for six months to this March fell 56 percent following the shutdown of Dalny Mine in August last year.

Sales from the bullion declined to $6,3 million from $14,4 million a year earlier, the Bulawayo-based gold miner said in a statement. Before the closure of the mine, Falgold got half of its revenue from Dalny.

The company opted to close the mine at the end of August 2013 and placed it on a care and maintenance basis after Zesa Holdings disconnected power supplies over non-payment.

Gold output fell to 4 789 ounces from 8 285 ounces a year ago. Average prices per ounce increased to $1 636 from $1 274. "The large drop in production in 2014 as compared to 2013 is attributable to the closure of Dalny Mine in August 2013.

With the closure of the mine, and current production at Golden Quarry at stable output level based on installed equipment and plant infrastructure, any improvements in the performance of the company will require installation of additional capacity.

Net loss for the period narrowed to $1,65 million from $2,60 million a year earlier. Mining and processing costs decreased to $6,6 million from $15,49 million.

The operating margin at -5,8 percent dropped from -7,4 percent due to the closure of Dalny Mine and cost cutting measures necessitated by the fall in gold prices. Cost for maintaining Dalyn Mine was $774 475 and was included in the net loss for the period.

African Consolidated Resources has since offered $8 million to acquire Dalny Gold Mine.
- The Herald

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