Sydney - Tuesday - Sep 13: (RWE Australian Business)Croesus...

Sydney - Tuesday - Sep 13: (RWE Australian Business)
Croesus Mining NL (ASX code: CRS) today reported a net loss of $16.98 million for the year ended June 30.

The loss has been blamed on poor second-half gold production which fell to 70,315 ounces and to exploration and development write-downs totalling $15.74 million.

Gold production during the second half at Davyhurst was adversely affected by underperformance of the Callion pit and lower-than-expected grades from the Lady Gladys stockpiles.

At Norseman production fell due to the deferral of the Scotia open pit, delays in stoping HV1 East and remnant mining at Bullen.

The results also reflect increasing open-pit contract mining costs and the impact that the rising oil price has had on power costs at Norseman.

The carrying value of tenements, including those acquired during the merger with Central Norseman Gold Corporation Ltd, was reviewed by the board and it was decided that those areas where no identified reserves had been established would be written down accordingly.

Group annual gold production was 183,020 ounces at a cash cost of $440 per ounce.

The majority of production was sourced from Norseman and Davyhurst with minor clean-up from Hannan South/Binduli decommissioning.

Earnings before interest, tax, depreciation and amortisation (EBITDA) were $6 million.

Loss per share was 5.2c.

At year-end cash reserves were $21.8 million.

During the year Croesus secured $15 million funding by placing a secured convertible note with Macquarie Bank Ltd (ASX code: MBL).

Gold production for 2005/06 is forecast at 170,000 to 180,000 ounces at a cash cost of $375 per ounce.

This reflects the placing of Davyhurst on care and maintenance, as announced on August 17.

Shares in Croesus fell 2c to 36.5c today.