And, like almost all of the major gold mining companies, the continuing fall in the gold price has affected Centamin's bottom line profitability. Mining companies more than any other find fluctuations in commodity prices problematic. This is because the shifting price of the underlying commodity mined goes directly on or off the bottom line profitability.
Today’s figures highlight the issue, with the company’s core earnings dropping for the last quarter to $63.7 million compared to $81.7 million from the previous quarter. This is even with an 8% increase in productivity over the same time period.
Centamin remains confident that it will be able to meet its full-year target of 320,000 ounces of gold while also maintaining operating costs at $700 an ounce.
What is considerably less clear is the stability of Egypt and the ongoing operating licences that the company has. With shifting political powers overseeing the country, current agreements might arguably not be worth the paper they are written on.