* Sees 2012 output at lower end of 825,000-865,000 oz range
* Q3 production down 3 pct vs. Q2, profits down 15 pct
* CEO says confident on Q4
* Shares down 5 pct
LONDON, Nov 7 Miner Randgold Resources
said gold production for the year would come in at the bottom
end of guidance after posting disappointing quarterly output and
earnings, hurting its shares.
The Africa-focused company said on Wednesday that power
problems at its Tongon mine in the Ivory Coast meant that annual
production would be closer to the 825,000 ounce low end of a
full-year output range, which stretched to 865,000 ounces.
Production in the third quarter fell 3 percent from the
prior quarter, and lower sales contributed to a 15 percent drop
in profits to $121 million, piling pressure on the company to
post record production in the fourth quarter to be able to meet
Shares in Randgold were down 5.45 percent to 7,020 pence at
0918 GMT, making the company the top faller on Britain's blue
Randgold also said total cash costs to produce an ounce of
gold rose to $737, up 5 percent from the second quarter, as
power costs were higher and it mined lower grades.
Analysts from a range of brokerages said production and
earnings missed their forecasts and that Randgold's costs were
higher than expected.
"(The) cost miss, continued problems at Tongon, and a hefty
requirement for fourth-quarter production to make up for the
third quarter miss should all weigh on the shares," Nomura
Chief Executive Mark Bristow said in an interview he was
confident that the company would bounce back in the fourth
"We're going to have a stonker fourth quarter. The costs
will come down significantly on the back of us delivering on our
production forecasts," he said.
Production at the company's Tongon mine, where it plans to
introduce new power generators, will step up in the coming
quarter, Bristow said.
He also said output from the Luolo project in Mali, where
operations have been unaffected by unrest, will also rise in the
period as higher grades are mined.
The company also said its Kibali project in Democratic
Republic of Congo was on track to start production before the
end of 2013.
"Kibali is on track. Nine months into construction, we're
slightly ahead of plan," Bristow said, adding that December next
year was the most likely date for start-up.