News

September 30, 2008

Highland Gold Swims Against The Tide, As Usual: This Time It’s Good News As Everyone Else Runs For Cover

By Alastair Ford

Shares in Peter Hambro Mining have fallen out of bed lately, having halved in value since August as the Russian-focussed gold miner booked a series of exceptional charges in its latest set of financial results, as well as reporting a serious increase in costs. Shares in fellow Russian producer Highland Gold haven’t exactly been on a winning trend this year either, down as they are from the high of around 250p reached as last winter was drawing to a close to the current 71.5p. However, Highland’s shares have at least enjoyed a bit of a bounce this September, after they fell below the 30p level a few weeks ago. So as the credit crunch really ratcheted up, Highland’s shares have actually doubled. Not many companies can say that, and certainly not Peter Hambro, which is often mentioned in the same breath as Highland, and held up as a paragon to point to Highland’s failings.

This comparison is not Peter Hambro’s doing. When other Russian miners are mentioned to him he actually has very little to say at all, preferring to focus on his own operations and leave other people to theirs. And it’s not Henry Horne’s doing either. The outgoing Highland chief says the comparison with Peter Hambro is not “comparing apples with apples”, partly on the basis that part of one of Highland’s key operations, MNV, is underground, whereas Peter Hambro is currently only mining open...