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Acacia maintains guidance despite export ban

02 June 2017 07:53

Acacia Mining remains hopeful it will reach a resolution over the Tanzania ban on exports of gold/copper concentrates and is not making any changes to full year guidance although it has seen some impact on productivity levels.

The findings of the first presidential committee's investigation into the export of gold/copper concentrates were announced on 24 May and Acacia provided detailed comments on these on 26 May.

Acacia said that since then, it had continued to co-operate with the second presidential committee, which was set up to examine economic and legal issues associated with historic exports of gold/copper concentrates.

The company said it had provided extensive information to this committee and have provided access to each of our mine sites.

An update said: "We believe that the second committee is close to completing its work, following which we would welcome the opportunity to discuss the findings directly with the government.

"We remain hopeful that we will be able to reach a resolution to the current situation with the government so that we can continue to deliver strong performance from our mines for the benefit of all stakeholders.

"Our mines continue to operate as normal, producing and selling gold dore whilst stockpiling gold/copper concentrate.

"As of 31 May, we have approximately 85,000 ounces of gold, 4 million pounds of copper and 50,000 ounces of silver contained within unsold concentrate.

"In light of the increased levels of uncertainty, we have seen some impact on productivity levels, but at this stage we are not making any changes to full year guidance and continue to take steps to minimise further cash outflows from the business."

Acacia said that over the past two months it had paid the final dividend of US$34 million to shareholders, declared prior to the introduction of the concentrate ban in early March.

It said it had also refunded US$22m of advanced payments for concentrate produced prior to the export ban, which was held up in the Dar es Salaam port.

It said this amount was now being recognised as a receivable.

It added: "As a result of these payments, together with the deferral of sales, a US$10m North Mara tax payment related to historic corporate tax assessments, and a continuing lack of VAT refunds, our cash balance at the end of May was approximately US$165m, with approximately 15,000 ounces of unsold dore on hand.

"In the absence of the resumption of the sale of concentrates, the combined operating cash outflow going forward at the affected assets is in the region of US$15m per month, while North Mara remains unaffected."

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Related Company: ACA

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