Shares of gold miner EVOLUTION FPO (ASX: EVN) ended the day lower following the release of a rather upbeat half yearly report.
In the six months to 31 December 2014, profit rose an impressive 22% over the prior period, as cost-cutting and production increases offset a lower gold price. The average realised price was $1,429 per ounce, backed up by an all-in sustaining cost of $1,035 per ounce.
The record $43.1 million profit was buoyed by record low costs of production and sales levels of both gold and silver.
Total revenue jumped 1% to $325 million during the period, whilst earnings before interest and tax, or EBIT, rose 18%.
C1 cash costs fell 7% and boosted cash flow to $29.5 million before financing.
Evolution's balance sheet also ended the period in good shape, with gearing reduced to just 9.7%. As a result management declared a one cent per share dividend, which will be paid on 27 March 2015.
Chairman Jake Klein said, "Evolution continues to deliver reliable and predictable operating performance coupled with strong margin expansion. Our record net profit was achieved despite the gold spot price averaging below $1,400 per ounce during the half year, around $150 per ounce lower than the current gold price. This is a direct reflection of our ongoing focus on innovation and cost reduction initiatives."
He said, "As a result of Evolution's financial strength we have declared an interim dividend consistent with our gold revenue linked dividend policy."
At today's prices Evolution shares change hands on a price-earnings ratio of 8.7 and price to book ratio of 0.9.
