- The gold production has started good in 2010. The amount produced gold was
67.7 kg (0 kg) in the quarter January - March 2010.
- For the quarter January - March 2010, the total income amounted to MSEK 30.2
(MSEK 204.8). Comparative figures for January - March 2009 excl. goodwill
dissolution was MSEK 3.5, i.e. an improvement in 2010 of MSEK 26.7.
- For the quarter January - March 2010, EBITDA was MSEK 1.3 (MSEK 196.4).
Comparative figures January - March 2009 excl. goodwill dissolution was MSEK
-4.9 i.e. an improvement in 2010 of MSEK 6.2
- The net result after tax and minority interest for January - March 2010 was
MSEK -5.4 (MSEK 181.9). Comparative figures 2009 excl. goodwill dissolution was
MSEK -19.4 i.e. an improvement in 2010 of MSEK 14.0
- EPS was SEK -0.30 (SEK 11.50) for the quarter January-March 2010.
- Approved gold reserves C1/C2 on current licenses are expected to reach
approximately 34 tons during 2010. As per the report date they amount to
approximately 24 tons.
(For full report including tables se attached file)
Comments by the Managing Director
The first quarter 2010 has been characterized by the finalization of the plans
for the implementation of the new strategy for CAG. A strategy that is geared
towards building a more stable, more predictable and substantially increased
gold production, and a build-up of gold reserves through increased exploration
and acquisitions.
The development plans for 2010 and beyond puts focus on:
1. Launching of two Heap Leach (HL) operations:
a. A new Tardan HL plant sized for an annual production capacity of 1200 kg
gold to be built in two stages.
b. Solcocon HL plant restart with the objective to reach an annual production
of about 250 kg.
2. Continue alluvial gold mining at Irkutsk and Chita regions in 2010 with
short-term profitability being the only single criteria operations to go on.
3. Resuming exploration at the company's sizeable license areas.
4. Evaluate acquisition opportunities of other gold licenses and gold producing
properties in the near areas.
Financing and the start of 2010 years' production within the existing deposits
are running according to plan. Operationally we can this year report that; a
gold production of approximately 68 kg compared with 0 previous year and a
positive EBITDA result of 1.3 MSEK compared with a negative 4.9 MSEK result for
the previous year.
An extensive analysis of the production in the alluvial deposits is taking
place, in order to finally establish which plants are expected to generate a
positive result. Other deposits will be closed or sold.
The Tardan plant expansion efforts have been further intensified. Such an
investment is expected to generate a cash flow of approximately 50-70 MSEK
annually with a payback of less than two years. The upgrading of the HL Plant
in Solcocon is also developing rapidly. Additionally, the final review required
in order to establish the size, resource and capital need for optimizing the
effects of new exploration work is moving forward. The cooperation with
Centerra Gold concerning exploration of the attractive assets in Kara-Beldyr
has developed according to plan.
The registration of approximately 9.5 tonnes of additional gold reserves in the
Kozlovskoye deposits has been delayed due to administrative reasons. Our
assessment is that these gold reserves will be approved during 2010 remains,
but approval is now expected during the second half of the year.
We expect to return shortly with a more concrete presentation to describe the
effects of the above mentioned planned activities and the financing of these
activities.
The year of 2009 can be described as the year of merger and analysis,
operationally a "lost" year. However, we do believe that 2010 will be the year
when we "turn the page" the starting platform for a strong development with
stable increased production volumes together with the build-up of new gold
reserves. We will already during 2010 see the outcome of the actions taken,
such as an expected gold production increase of approximately 50%. However the
full effect is expected 2011 and ahead.
- We have now commenced our journey towards stability and growth and welcome
you all to participate!
Preston Haskell, Managing Director
Background
Central Asia Gold AB (CAG AB) is a Swedish mining company with operations in
Eastern Siberia, Russia. In March 2009 CAG AB completed the merger with Russian
gold mining group New Mining Company ("NMC") by way of an issue in kind.
The group structure consists of the Swedish joint stock parent company, which
controls ten subsidiaries in Russia. The Russian subsidiaries are of the
limited liability type ("OOO"). The operations involve exploration and
production of gold, primarily in the Tyva, Tchita and Irkutsk regions in
Russia.
The group's main assets comprise a large number of mineral licenses held by the
various subsidiaries. The licenses, as at the end of three months period of
2010, are estimated to contain almost 760,000 troy ounces (oz) (1 oz = 31.1 g)
of gold reserves according to the Russian C1+C2 categories (equaling some 24
tons).
CAG AB was publicly listed on the Swedish NGM Nordic Growth Market stock
exchange on March 29, 2005. The number of shareholders was some 4,200 as March
31, 2010.
For more information, please contact:
CEO Preston Haskell, tel: +46 768 90 55 49, fax: +46 (0)8 624 37 20,
e-mail: preston.haskell@centralasiagold.se, website: www.centralasiagold.se,
Postal and visiting address: Engelbrektsplan 2, 4 tr., 114 34 Stockholm.
Chairman Lars Guldstrand, tel +46 705 28 81 81,
email: lars.guldstrand@centralasiagold.se
