News

March 27, 2008

European Goldfields Is Making Profits, Has Cash In The Bank, And Promising Exploration Assets Out In The Field

By Our Man in the City

“We’re still a growth story,” says David Reading, chief executive of European Goldfields. In an industry renowned for promoters eager to push underwhelming projects, Mr Reading can at least point to a track record of successful growth when he says that. As one of the few mid-tier producers to maintain a steady expansion programme, European Goldfields deserves a pat on the back for its recent achievements, having this year entered its third country, increased reserves at its flagship Stratoni lead-zinc-silver mine and turned in a 178 per cent rise in annual pre-tax profit to US$33.4 million. Four years ago, the company was valued at US$180 million when it listed on Aim. Today at US$1 billion, it’s clear how far the business has progressed.

“The market is starting to believe our capabilities,” says Mr Reading, referring to the company’s ability to replace mined reserves at Stratoni in Greece. “We’ve mined for two years and replaced two years’ worth of material with new reserves. Stratoni has six years left (on paper), but I’m confident that further exploration will add a further three years to the project”.

While Stratoni continues to deliver, a bigger challenge is to turn another Greek deposit, Skouries, into a...