Canada’s Aurizon Mines eyes junior miners for growth
Ashutosh Joshi, Reuters Published: Tuesday, August 18, 2009
financialpost.com
BANGALORE -- Gold producer Aurizon Mines Ltd expects to maintain strong profit margins this year on the back of rising yellow metal prices and is looking to acquire struggling junior miners to expand its operations in North America, its chief executive said.
"In terms of area, our focus is North America, primarily Canada and in terms of size, we are looking at something that can actually produce up to 100,000 ounces (of gold), with a sort of 10 years mine life projected," Chief Executive David Hall said in an interview with Reuters.
Despite the precious metals industry witnessing a large number of takeovers and rising gold prices, many small-sized producers are still finding it difficult to access funds from the capital markets, he said.
Gold continues to attract strong investment interest, amid a tepid recovery in the global economic situation, Mr. Hall said.
Operating profit margin growth has been strong at the miner over the past one year, mainly driven by higher gold prices and lower costs related to labor and consumables, such as chemicals and reagents used by gold companies.
Operating profit margin per ounce at Aurizon rose 15% to US$511 for the six months ended June 30.
"On one hand, we got reducing cost and on the other we have rising price of the metal we produce. The industry is in very healthy status today," the CEO said.
Spot gold XAU, that hit its two-month high of US$971.25 an ounce earlier in the month, was bid at US$938.65 an ounce Tuesday afternoon.
Shares of the Vancouver, British Columbia-based company, which owns Casa Berardi mine in Quebec, were up 22 Canadian cents at $4.67 Tuesday on the Toronto Stock Exchange. |
