Chaarat Gold laments strong Armenian dram as interim loss widens

(Alliance News) - Chaarat Gold Holdings Ltd on Thursday reported a significantly worsened loss in the first half of 2023, as revenue dropped.

The gold miner has an operating mine in Armenia and assets in Kyrgyzstan. It said pretax loss in the first half of 2023 widened to USD25.8 million from USD1.5 million a year prior. Revenue fell 30% to USD35.3 million from USD50.4 million.

Chief Executive Officer Mike Fraser cited a fatal incident that happened in March during mining activities at the Kapan mine in Armenia, with the financial performance of the mine continuing to be hurt by a stronger Armenian dram. The dollar is down 2.0% to AMD385.6800 as at Thursday from AMD393.6051 at the start of 2023.

Looking ahead, Chaarat is focused on completing its sale of Kapan to Gold Mining Co LLC by the end of this month and on progressing its potential USD250 million Xiwang investment. The planned Xiwang investment would support the development of Chaarat's organic pipeline and facilitate external growth through value-added acquisitions, it said. Further, it aims to review strategic options for Kyzyltash and Tulkubash and ensure that its working capital requirements are met, such as sufficient funding in the fourth quarter.

Last month, Chaarat said it agreed to sell its Kapan mine in Armenia to Gold Mining Co for USD55.4 million.

Chaarat Gold shares fell 11% to 5.75 pence each on Thursday afternoon in London.

By Tom Budszus, Alliance News reporter

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