(Reuters) - Precious metals miner Hochschild Mining Plc (HOCM.L) reported lower first-half pretax profit on Wednesday, as a drop in the average price of silver led to lower group production.
Hochschild’s post-exceptional profit before income tax fell 23.5% to $29.5 million (£24.5 million) for the six months ended June 30, as the average price of silver fell 7%.
Hochschild said its first-half had the second highest attributable production in the company’s history with 245,325 gold equivalent ounces or 19.9 million silver equivalent ounces, compared with 256,939 gold equivalent ounces or 20.8 million silver equivalent ounces last year.
“In mid-June, the gold price started to rise significantly on the back of global uncertainty and a fall in the U.S. dollar and reached levels not seen in six years,” Chief Executive Officer Ignacio Bustamante said.
Bustamante also said a rise in silver prices in July led the company to expect healthy second half cashflow generation, provided the price strength is maintained.
The Peru-headquartered miner said it was on track to meet its forecast for full-year production and all-in sustaining costs target.
Hochschild also reported adjusted core earnings of $153.7 million, beating company compiled consensus of $144 million, according to J.P. Morgan analysts.
Rival Fresnillo (FRES.L) also trimmed its outlook for full-year gold and silver production and reported lower output for the two metals last month.
Reporting by Tanishaa Nadkar and Yadarisa Shabong in Bengaluru; Editing by Bernard Orr and Rashmi Aich