Azerbaijan-focussed gold, silver and copper producer Anglo Asian Mining was holding its annual general meeting in London on Friday, with CEO Reza Vaziri explaining to investors that he was “very pleased” with the return of the company to profitability in 2016.
It was a “significant achievement” for the AIM-traded company, Vaziri explained, adding that it was evidence of its success over the last several years to transform its performance.

The firm's full year 2016 results showed an increase in total revenue to $79m, with an all-in sustaining cost of production of gold reduced significantly to $616 per ounce from $858 per ounce year-on-year.

As a result, the company recorded a profit before tax of $6.8m.

“This return to profitability went in hand-in-hand with excellent cash generation, with an 82% increase in operating cash flow before movements in working capital to $34m, and net debt reduced by $14m to $35m at the end of 2016,” Vaziri explained.

“Operationally, we are seeing the mineral composition of our ore evolve over time with an increasing copper content and this has been reflected in both our processing strategy and production.

“Looking firstly at our production in 2016 – the major theme was a large upswing in copper production, off-setting reduced gold production, and we expect this trend to continue moving forwards.”

The company reported full year copper production for 2016 of 1,941 tonnes, a 100% increase on the previous year.

Silver production also increased 477% to 165,131 ounces.

“Production of both copper and silver was significantly increased by our flotation plant, which had its first full year of production in 2016,” Vaziri claimed.

It produced 6,339 dry metric tonnes of concentrate containing 1,121 tonnes of copper, 4,430 ounces of gold and 122,965 ounces of silver during 2016.

Gold production totalled 65,394 ounces at an average all-in sustaining cost of $616 per ounce and was sold at an average sales price of $1,253 per ounce, which “clearly” demonstrated the firm's “now very healthy” production margin, according to Vaziri.

“These excellent financial and production results reflect the ongoing success of our long-term plan of sustainability and cost reduction.

“Key components of this strategy for the current year are the extensive exploration and production optimisation of the main open pit and the Gadir underground mines and the start of production of the newly discovered Ugur gold ore body.”

The firm was also testing a new configuration of the flotation and agitation leaching plants to give it “added flexibility” in processing.

“We have extensive stockpiles of ore which can now be processed whilst mining is temporarily paused during exploration and production optimisation.

“With this in mind, we have declared a production target for FY 2017 of between 64,000 gold equivalent ounces (GEOs) and 72,000 GEOs, which is a modest reduction on last year's production of 72,304 GEOs during this important phase of exploration and optimisation.”