**UPDATE: Centamin Shares Hit By Sukari Production Downgrade**
LONDON (Alliance News) – Shares in Centamin PLC fell Wednesday morning after the FTSE 250-listed gold miner downgraded its full-year production guidance for the Sukari gold mine in Egypt, its main project.
Shares in the company were down 8.2% to 47.99 pence in mid-morning trade, making it the second worst performer in the FTSE 250 after Stock Spirits Group PLC, after Centamin said its forecast production for the full year in 2014 at Sukari is expected to be between 370,000 and 380,000 ounces at a cash operating cost of USD700 per ounce.
Though the number is up on its 2013 production at the site of 356,943 ounces, it is a significant cut against the original forecast of 420,000 ounces, at the same cost, which Centamin had previously set out.
The group said the cut to the production guidance was due to reduced monthly plant activity at Sukari during October and lower-than-expected average grades from underground development ore.
It does expect improvements in average plant throughput rates in the rest of the year and into 2015 as its expanding processing plant moves towards optimisation.
Centamin said it expects gold production to improve in the fourth quarter to a level which, on an annualised basis, which see the company meet its forecast post-expansion production rate of 450,000 to 500,00 per year.
Numis said that though the downgrade was not unexpected, with the broker saying that Centamin’s previous guidance for the fourth quarter seemed “too big a stretch” and Numis’s own forecast had been lower.
But Numis said the revised guidance was even lower than its 403,000 ounces prediction. Numis has downgraded its 2014 earning per share by 12% but has left its forecasts for 2015 unchanged.
The broker reiterated its Hold recommendation on the stock with a 60 pence price target.
By Sam Unsted; [email protected]; @SamUAtAlliance
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