Fresnillo profits double

2nd Mar 2010 07:31

Fresnillo, the world's biggest primary silver producer and Mexico's second largest gold producer, more than doubled profit after tax in 2009 on higher metal prices and record silver output.Profit leapt to $358.27m from $152.78m in 2008, helped in part by a 13.5% reduction in its tax bill to $99m. Pre-tax profit increased 71% to $457.4m on revenue up 18% to $849.94m, aided by higher average metal prices, "excellent" operational results and lower costs per tonne.Silver production jumped 9% to 37.9 million ounces, largely as a result of higher ore volumes milled at Fresnillo, higher metal contents extracted from the development works at Saucito, and higher silver ore grade at Ciénega.There was a better than expected 5% hike in gold production last year to 276,584 ounces, with output at Herradura reaching an all-time record of 259,839 ounces. The start up of Soledad-Dipolos as an operating mine ahead of schedule will boost attributable gold production by an expected 20%, says the miner, while silver production is expected to remain in line with 2009 levels this year."We enter 2010 with a strong cash position and no debt on the balance sheet and on track to achieve our aim of delivering one new mine or mine expansion per year until 2014," said chief executive Jaime Lomelin.The company believes these results keep it "firmly" on track to remain the world's largest primary silver firm by producing 65 million ounces of silver and over 400,000 ounces of gold by 2018.