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Eldorado 2Q Profit Down On Sales Drop, Rising Cost

Stocks in this article: EGO

NEW YORK (AP) â¿¿ Shares of Eldorado Gold Corp. rose Friday after the Canadian mining company said its second-quarter net income fell 38 percent as production and sales declined while average cash operating costs rose.

For the April-through-June quarter, Eldorado on Friday reported net income of $46.6 million, or 7 cents per share. That compared with net income of $74.9 million, or 14 cents per share, a year ago.

Overall revenue fell about 3 percent to $244.2 million from $252.6 million. Gold sales also dropped, although the average price rose to $1,612 per ounce from $1,510 per ounce.

Gold production fell 13 percent, while average cash operating costs rose to $480 per ounce from $397 per ounce.

Eldorado, which is based in Vancouver, British Columbia, also attributed the decline in net income to lower earnings before taxes from gold mining operations, and higher general, administrative, exploration and tax expenses.

Eldorado reduced its 2012 forecast to 660,000 ounces of gold at average cash operating costs of $465 per ounce because of a treatment plant delay at a mine in Turkey and a delay in permitting for a mine under construction in China.

That compares with the previous full-year guidance of 730,000 ounces to 775,000 ounces and cash operating costs in a range between $430 per ounce and $450 per ounce.

Shares of Eldorado rose 46 cents, or 4.4 percent, to $10.85 in early trading. In the past 52 weeks, the price has ranged from $9.78 to $22.12 per share.

Copyright 2011 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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