(Reuters) -Australian gold miner Capricorn Metals' shares fell 9% on Friday, staging their biggest loss in over 10 months after recording weaker production at its Karlawinda gold project.

Shares fell as much as 13.9% at A$4.150 at 0400 GMT.

A total of 2.3 million shares changed hands, over twice the 30-day average trade volume.

The miner's Karlawinda gold project produced 28,859 ounces of gold in the fourth quarter, down from 30,841 ounces in the previous quarter, it said in a statement.

Capricorn operates two distinct project areas within Western Australia, namely the Karlawinda and Mt Gibson gold projects.

Mining activities at Karlawinda were hit by major operational challenges in March following extreme rainfall.

The company's all-in sustaining cost (AISC) - a metric to estimate all direct and recurring costs required to mine a unit of ore - rose to A$1,311 per ounce (OZ) in June quarter from A$1,085 reported in March quarter.

However, AISC at Karlawinda continues to be amongst the lowest in the Australian gold industry despite industry wide cost pressures, the company stated.

Annual gold production of 120,014 ounces came in at the mid-point of its guidance of 115,000 - 125,000 ounces.

The company now expects to record 115,000 ounces of gold in fiscal year 2024, compared with 120,014 ounces produced in 2023.

(Reporting by Poonam Behura in Bengaluru;Editing by Nivedita Bhattacharjee)