Perseus scales back outlook

Gold miner to cut jobs, directors' wages as it reviews African operations.

Africa-focused Perseus Mining (PRU) has cut staff and slashed directors' pay packets as it scales back expectations for its Edikan mine in Ghana.

Shares in the Perth-based gold miner fell more than 4% today, despite Perseus sticking to its half-year production targets.

As part of recently implemented cost savings, Perseus has reduced directors' fees and salaries by 15%, placed a freeze on bonuses and reduced staff numbers in recent months, managing director Jeff Quartermaine said.

"The impact of a number of the cost saving initiatives has been immediately evident in the unit costs recorded for the quarter to date," he said.

The company also said a recent mine review revealed a 6% reduction in contained gold at the Edikan mine.

The life plan of the Edikan mine has also been revised.

"This strategy has slightly reduced the amount of gold that we will produce over the life of the Edikan mine but results in materially less investment in mining and processing than would otherwise be the case, which in the current economic climate is very important," Mr Quartermaine said.

Perseus said it was on track to produce between 99,000 and 109,000 ounces of gold at the Edikan mine in the first half of the 2013-14 financial year.

Its gold production for the month of August was 15,520 ounces, down from 16,730 ounces in July.

The company said it was on track to achieve cost guidance of $US1,000-1,200 per ounce of gold in the six months to 31 December 2013.

Perseus will give an update on the life of its mines when it releases its September quarterly report.

Perseus shares were down 2.5 cents, or 4.4%, to 55 cents at 1241 AEST.

InvestSMART FORUM: Come and meet the team

We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles