Randgold Resources Ltd (LON: RRS) sees a surge in production for 2011 as it reported a 43 percent rise in full-year profit in spite of operational and political setbacks.
The West Africa-focused miner, which boosted its annual dividend by 18 percent to 20 cents, forecasts production to be between 750,000 and 790,000 ounces for 2011, up more than 70 percent on last year.
For the year ended Dec. 31, profit increased to $120.6 million from $84.3 million. Gold sales rose 12 percent to $487.7 million lifted by a rise in price. Attributable production fell 10 percent to 440,107 ounces from 488,255 ounces.
Chief executive Mark Bristow said given the scale and complexity of the projects the company was developing, 2010 was always going to be a tough year, and it proved even more difficult than expected due to technical problems related to the expansion of the Loulo complex in Mali and the unsettled situation in Cote d'Ivoire.
For the fourth quarter, the company's profit fell to $32.2 million from $38.7 million in the year-ago period. Earnings would have increased 40 percent had it been able to sell all the gold produced at the Tongon mine in the Ivory Coast, Randgold said.
The Tongon mine was commissioned on schedule despite difficult circumstances, pouring its first gold on November and producing 28,126 ounces by the end of the year, the company said, adding that 23,428 ounces remained unsold at Tongon at year end resulting from disruptions in Cote d'Ivoire following the disputed presidential elections in November.
Randgold expects Tongon to contribute 260,000 to 270,000 ounces for the year, provided the political situation in Cote d'Ivoire does not impact on the mine much longer. Loulo complex's production for 2011 was expected to be in line with the forecast of 420, 000 to 440, 000 ounces.
Shares of the gold miner are trading 2.4 percent higher at 5,095 pence at 08:15 am GMT Monday on the London Stock Exchange.