The share price for OceanaGold Corporation [ASX:OGC] is up 1.63% today at time of writing.
OceanaGold is multinational gold producer with a 1.7 billion market cap headquartered in Melbourne, Australia. They also have offices in the US and Singapore.
Some of their operating assets include the Didipio Mine in the Philippines, Macraes Operation and Waihi Gold Mine in New Zealand and the Haile Gold Mine in the US.
What’s going on with OceanaGold?
The company announced their first quarter 2020 results.
For the quarter ended in 31 March 2020, the company’s EBITDA (earnings before interest, tax, depreciation and amortisation) fell to US$42.4 million, a close to 34% decrease from the US$64.4 million in the same period last year.
Gold production also decreased by 25% from the previous quarter which, according to the company, were from lower sales from their New Zealand assets.
The company ended the quarter with a net loss of US$26 million, a much different result from the US$12.4 net profit it had for the same period in 2019. Some of the losses were partially offset by a 7% increase in the average gold price the company received.
Michael Holmes, President and CEO of OceanaGold had this to say:
‘[W]e look ahead to the remainder of the year where, in the second half in particular, we expect increased production at lower All-In Sustaining Costs. At Haile, mined and processed grades are expected to increase progressively with two-thirds of Haile’s annual gold output expected in the second half with the fourth quarter being the strongest quarter. At Macraes, second quarter production is expected to be lower than in the first quarter due to the impact of the five-week New Zealand Government enforced COVID-19 lockdown. However, with production now effectively back to capacity we are targeting a rebound in the second half of the year.’
What could happen next?
While the company expects results to take a hit due to the COVID-19 lockdowns in New Zealand, they have confirmed their full year guidance.
OceanaGold assured investors they have implemented strict protocols to protect the workforce from COVID-19 and, so far, they have no cases. But they noted that ‘risks associated with COVID-19 remain elevated and could further impact our operational performance’.
Markets have taken the news well, which has shown with the share price moving 1.63% higher.
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