Resolute Mining to book write-down on outlook for gold Prices, production
Resolute Mining Ltd. announced that it expects to book a noncash write-down of between US $165 million and US $175 million after taking into account its current outlook for gold prices, increasing interest rates and production.
The mining company, which is listed in Australia and the U.K., said the impairment charge is expected to be recognized in its half-year results and relates to its Syama mine in Mali. The company said the write-down results from its current assumption that gold prices will be 5% to 10% lower in the short to medium term compared with its assessment in December, an increase in interest rates and a recent downgrade to its 2021 production guidance.
Gold production guidance
Last month, Resolute cut its gold production guidance to between 315,000 and 340,000 ounces from between 350,000 and 375,000 ounces previously. It also raised its cost expectations to between US $1,290 and US $1,365 an ounce, which compares with previous guidance for US $1,200 to US $1,275 an ounce.
The company said there is no impact on cash flows, mine plans, gold reserves and existing debt covenants from the impairment charge.
