News

July 09, 2008

With $120 Million Cash As Insulation, Avocet Mining Looks Comfy And Cosy While The Storm Rages Outside

By Alastair Ford

Full year financial results have just come out from Avocet Mining. Apart from a US$36 million hit taken by the company on a slightly obscure hedging arrangement, they look pretty good. Cash flow’s up, production from continuing operations is up, cash costs are down and profits are up. There’s also US$122 million in cash or cash equivalents on the balance sheet, and a further US$25 million un-drawn facility available to the company from MacQuarrie.

Chief executive Jonathan Henry admits that the US$36 million write-off has taken “some of the shine” off these results, but over all he’s fairly pleased with the way things are going. Certainly the company seems to have recovered its poise after some tricky moments over the last few years. “The reality is”, says Mr Henry “that Avocet had a lot of debt and had a lot of problems”. He doesn’t spell it out, but the message is that in these troubled times it pays to be boring. And Avocet has just...