TORONTO (miningweekly.com) – Senegal-focused gold miner Teranga Gold on Wednesday said it had swung to a full-year consolidated profit of $79.9-million or 33c a share in 2012, up from a loss of $16-million in 2011, mainly owing to an increase in gross profit from higher revenues, lower regional exploration expenditures and lower gold hedge losses.

The TSX- and ASX-listed company reported record fourth-quarter profit of $48.8-million or 20c a share, which was a 106% improvement on the same quarter a year earlier.

Full-year gold production for 2012 was within the company’s original guidance of between 210 000 oz and 225 000 oz at 214 310 oz, a company record and 63% higher than for the 2011 period. Gold production for the three months ended December 31, was 71 804 oz, 96% higher than a year earlier.

Teranga said total cash costs for 2012 were within the $600/oz to $650/oz guidance, at $627/oz sold, which was 20% lower when compared with $782/oz for the twelve months ended December 31, 2011.

Fourth quarter total cash costs were $623/oz sold, compared with $809/oz in the same period a year earlier, a reduction of 23%.

The company said the gold hedge book was reduced to 59 789 oz at year end and further reduced to 38 105 oz as at January 29. Management expects the hedge book to be extinguished by June.

"As we eliminate the hedge book by mid-year, we anticipate that the increased cash margins and cash flows will provide us with a stronger balance sheet that should be able to fund our organic growth through our extensive exploration programme, while at the same time minimizing shareholder dilution," CEO Richard Young said.

The company said it had $45-million cash in the bank at the end of December, including $5.3-million in bullion receivables.

The company expected to produce between 190 000 oz and 210 000 oz at total cash costs of between $650/oz and $700/oz.

Meanwhile, the company said its measured and indicated resources increased by 34% to 2.9-million ounces, while reserves remained similar to 2011, net of production.

"With the mill expansion complete and optimisation work well under way we expect to be able to maintain an annual production profile of about 200 000 oz from our mine licence alone. We expect Gora, the most advanced in our exploration pipeline, will be additive to this production base leveraging off of our central milling facility as we target our first-phase growth of 250 000 oz to 350 000 oz of annual production," executive chairperson Alan Hill said.

The company’s Toronto-listed stock traded 11.56% lower at C$1.30 on Wednesday; however, the company’s stock had lost about 35% of its value from the start of the year.