Shares of Golden Star Resources Ltd. (GSS) moved up as much as 18% after it reported healthy preliminary production results for third-quarter 2013.
Golden Star sold 88,915 ounces of gold during the quarter at an average realized price of $1,329 per ounce. Of this, Bogoso/Prestea mine sold 44,085 ounces of gold and Wassa/HBB operations sold 44,830 ounces of gold in the quarter.
Gold sales reflect an increase of 4.5% from 85,090 ounces of gold sold at an average realized price of $1,418 per ounce in second-quarter 2013. Bogoso/Prestea mine sold 34,316 ounces of gold and Wassa/HBB operations sold 50,774 ounces of gold in the second quarter.
Golden Star sold 255,366 ounces of gold as of Oct 3, 2013. , It had a cash balance of $67 million as of Sep 30, 2013, and also held an additional available cash resource of $40 million from the undrawn portion of the Ecobank term loan facility.
Golden Star noted that Bogoso mine’s production increased quarter over quarter owing to increased processing throughput. Stripping at Chujah and Bogoso North have shown solid progress in the third quarter., However stripping ratios are expected to decline in the fourth quarter resulting in a decrease of costs moving forward.
The Wassa mine performed as per plan. With the current production trends from the mines, the consolidated annual production for 2013 is expected to reach the high end of the company’s guidance.
For 2013, Golden Star expects its gold production to be within 290,000 ounces to 310,000 ounces. Cash operating costs are anticipated to be in the range of $1,050 to $1,150 per ounce.
Golden Star, which currently retains a Zacks Rank #3 (Hold), will come up with its third quarter results on Nov 4 before the opening bell.