JOHANNESBURG (miningweekly.com) – Gold producer Centamin on Wednesday reported a 357% increase in its pre-tax profit to $266.8-million for the year ended December 31.

This translated into earnings a share increasing from $0.04 in 2015, to $0.23 in the period under review.

Centamin chairperson Josef El-Raghy said the company’s flagship Sukari gold mine, in Egypt, had continued to deliver substantial free cash flows in 2016, driven by a seventh successive year of production growth and lower operating costs.

“This performance has allowed us to maintain [a] strategic focus on generating shareholder returns and value-accretive growth. A significant milestone was achieved during the year, as the capital investment in the Sukari operation by Centamin's wholly-owned subsidiary Pharaoh Gold Mines was recovered from cash flows to the extent that profit share started with the Egyptian government during the third quarter,” he added.

Centamin ended the year with $428-million in cash, bullion on hand, gold sales receivables and available-for-sale financial assets - an increase of $197-million from the prior year.

The company would continue to invest in its long-term growth. “Beyond Sukari, we remain focused on our extensive licence holdings in West Africa,” El-Raghy said.

This includes focusing on building further prospective licence holdings in Côte d'Ivoire, with the new discovery at the Doropo project in the north-east of the country, where drilling to date has led to a maiden resource estimate of 300 000 oz indicated and one-million ounces inferred.

Further, work this year will be aimed at upgrading and expanding on this positive start towards project development. “In Burkina Faso, we continue to evaluate data from the extensive drilling programmes carried out to date and further work is being planned for the year ahead,” said El-Raghy.

The company concluded the 2016 year on a strong note, having produced 551 036 oz of gold.

This was paired with a lower production cost of $513/oz, down from $713/oz in the previous year. This was also below its revised guidance range, driven by higher production and reductions in mine production costs, mainly owing to lower fuel prices.

Centamin declared a final dividend of $0.13 a share, representing a full year payout of $178-million, equivalent to about 70% of its net free cash flow in 2016.

The company is targeting production of 540 000 oz this year, at an all-in sustaining cost of $790/oz.