Aim-listed gold recovery company Goldplat turned a profit in the quarter ended September 30 – the first time it has posted a profit since June 2018.

The company reported a loss of £501 000 for the 2019 financial year, ended June 30; however, a higher gold price and increased production supported a profit recovery in the September quarter.

The average gold price during the reporting quarter was $1 400/oz.

In South Africa, the company maintained good production levels and recorded sales of £4.47-million during the first quarter of its 2020 financial year, compared with sales of £3.3-million in the first quarter of the previous financial period, which were lower, owing to production issues.

The improvement in production levels year-on-year, supported by higher gold prices, resulted in an increase in quarterly operating profit to £1.07-million, compared with a loss of £252 000 in the prior comparable quarter.

Towards the end of the quarter under review, Goldplat started installing the first stage of a pretreatment section to the largest carbon-in-leach section at a cost of £70 000.

Pretreatment is intended to improve recoveries of and margins on lower-grade contaminated material and, together with efforts to reduce operating costs, should allow the company to source and profitably process lower-grade contaminated material.

The company’s tailings storage facility (TSF) is approaching full capacity in its current form and Goldplat will spend £250 000 during the last quarter of this calendar year to increase its life by a further 12 to 18 months.

“After consultation with various government departments, we have concluded that the costs we will need to incur to allow us to deposit into West Pit 3 will be more than those needed to extend our current TSF. In addition, we have started the design of the TSF, which, we expect, will be approved, constructed and commissioned during the next 12 months at an estimated cost of £500 000 to £700 000.

“Once we have established the new TSF, the existing TSF, which contains about 88 000 oz of gold, can be allowed to dry out, after which we can look at monetising this asset,” the company stated.

In Ghana, Goldplat achieved sales of £1.1- million in the quarter under review, compared with sales of £805 000 in the prior comparable quarter. This translated into an operating profit of £23 000, compared with a loss of £203 000 in the prior comparable quarter.

“The current indications are that the next quarter’s results should improve further; however, the sourcing of material to process remains sporadic and the visibility of future consignments remains low.

“There are indications that we are penetrating the West African market as planned and we remain optimistic that we will receive support from the various governments and the mines to expand our market reach to source material in West Africa. “We have more than a decade of history in Ghana and we are optimistic that the Economic Community of West African States countries will support our Ghana operation, being a regional enterprise,” Goldplat said.

The company is exploring opportunities for toll-treating lower-grade material from artisanal sources in Ghana. This potential revenue stream will be subject to obtaining support from the Minerals Commission of Ghana.

In Kenya, the company’s Kilimapesa gold mine site remained on care and maintenance during the quarter under review. To reduce the cash costs and maintenance, Goldplat was processing batches of artisanal material, which it would continue to do.

Operating losses were £127 000 for the quarter, compared with a loss of £352 000 in the prior comparable quarter.

Meanwhile, Goldplat and its joint venture partner have agreed to seek a buyer for the Anumso gold project, in Ghana, and discussions are ongoing.