PNA STRIKES FULL YEAR LOSS, LITTLE GOLD

PNA STRIKES FULL YEAR LOSS, LITTLE GOLD
PANAUST (ASX: PNA) couldn't surface a profit for the full year, bearing the brunt of lower commodity prices and a decline in gold, despite collecting record annual copper and silver production and sales.

PNA has posted a loss after income tax for the full year of US$221.4 million with the inclusion of impairments totalling US$264.7 million.

This is a slump from a $43.7 million profit in the 12 months to December 2013.

The company also halved their dividend per share to 3c for the year, and today declared no final dividend.

PNA managing director Fred Hess says the results reflect the impact of materially lower realised prices for all pay-metals sold and pre-development and discontinued exploration projects.

However, most notable were impairments recognised due to lower long-term gold price assumption. Gold output declined six per cent over the period for PNA, and sales more than 10 per cent.

Due to "volatility and uncertainty" in relation to metal price assumptions, PNA has elected to no longer provide one-year forward guidance for EBIDTA.

"We have a clear strategy which is focused on maximising the returns from our producing assets while advancing the Frieda River Copper-Gold feasibility study," says Hess, adding that the study has an anticipated completion date of year-end 2015 and will be funded from cash flow from operations.

PNA expects annual copper production to rise over the next several years to peak at 90,000t in 2018 and 2019 as grades improve.

Hess says together with a declining strip ratio from 2016 onwards, this is expected to enhance cash flow for the Frieda River Project.

"I remain confident that the fundamental outlook for the copper market, and therefore the copper price, is positive in the medium and longer term," he says.

"A cautious approach to fiscal management today, coupled with preparing Frieda River for a development decision when the market forces are likely more favourable, will lead to the prudent management of risk and enhanced returns for shareholders."


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