Mining Roundup: Randgold Share Price Slides on Profit Drop

on Aug 7, 2013
Updated: Oct 17, 2019
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iNVEZZ.com Wednesday, August 7th: The Randgold share price fell almost six percent this morning after the London-listed miner reported a significant drop in second-quarter profit prompted by a fall in the price of gold.

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Africa-focused Randgold Resources (LON:RRS) today said in a statement that while its second-quarter gold production was in line with the previous quarter, the average price of the precious metal received dropped 17 percent, pushing profits down 62 percent year-on-year to £54 million. The fall in the gold price received has been offset slightly by improved efficiencies, which has reduced the total cash cost per ounce by five percent.

Bullion declined 23 percent in the second quarter, reaching a 34-month low of $1,180.50 an ounce in London on June 28. Despite the fall in the price, Randgold’s Chief Executive Officer Mark Bristow today was upbeat in his comments on the results, saying that the company’s business model is able to deliver returns even at lower gold prices.

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The Randgold share price in London was 5.69 percent down at £4,176p as of 10:43 BST today. The slump has extended the stock’s decline this year to 28.6 percent.

**AngloGold Swings to Loss**
The AngloGold share price also plunged today, after the miner reported a turnaround to loss in the second quarter and said it planned to cut management positions to save costs.
South Africa-based AngloGold Ashanti (NYSE:AU), the world’s third-largest gold producer, today reported an adjusted headline loss, which excludes one-time transactions, of $135 million in the three months through June, compared with a profit of $113 million in the previous quarter. The company closed the second quarter with a loss before taxation of $3.08 billion, as compared to a pre-tax profit of $495 million a year earlier.

Revenue for the period was $1.3 billion, down from $1.6 billion last year. Gold production rose four percent to 935,000 ounces in the second quarter, but the company lowered its full-year output target to between four and 4.1 million ounces after revising its mining plans.
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Talking in a call with reporters today, AngloGold’s Chief Executive Officer Srinivasan Venkatakrishnan announced that the company plans to cut about 2,000 management jobs, or about 40 percent of its management positions, in an attempt to reduce costs and cushion the adverse impact of the falling gold price on its business.
Reflecting AngloGold’s disappointing quarterly results, investors sold off its shares today. The AngloGold share price in New York was down 4.67 percent to $12.05 as of 11:05 BST.
Randgold’s and AngloGold’s peers Glencore Xstrata (LON:GLEN) and Rio Tinto (LON:RIO) have lost more than two percent so far in today’s Lond on trading session. Glencore’s share price was also pushed down by a U.S. lawsuit, alleging the company and JP Morgan Chase had artificially inflated aluminium prices.
Shares in Fresnillo (LON:FRES) today extended losses after the world’s largest silver miner yesterday reported a 29 percent-drop in first-half profit (< a href=”https://invezz.com/news/commodities/4603-mining-roundup-fresnillo-share-price-sinks-on-drop-in-h1-profit”>Shares in Fresnillo ). The stock lost three percent this morning in London.

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African Focused Gold Miners Report Profit Growth despite Challenges
Index Reweight Impacts Share Prices of Commodities Companies

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http://nvz.bz/1cgV29L

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