Acacia Mining core profit slumps as Tanzania woes continue

In Summary

•Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) slipped

•Miner is also struggling with a long-running tax dispute in Tanzania where it operates its mines

Miners drilling for gold in a goldmine
Miners drilling for gold in a goldmine

Acacia Mining reported a slump in underlying core earnings as it struggled with production issues at its North Mara gold mine in Tanzania.

Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) slipped to $24 million for the three months ended March 31, from $44 a year earlier.

Gold production dropped 13 per cent to 104,899 ounces during the quarter, as a fall of ground in the North Mara Gokona underground mine prevented access to higher-grade stopes, the company said.

The miner is also struggling with a long-running tax dispute in Tanzania where it operates all its mines. It has cut output by a third since the government banned the export of mineral concentrates in 2017.

However, the company stood by its production target for the rest of the year.