(Boursier.com) — Euro Resources has published its unaudited interim financial statements, prepared in accordance with the French accounting framework (GAAP), as well as its unaudited condensed interim financial statements, prepared in accordance with International Financial Reporting Standards (IFRS) for the six months ended June 30, 2022. Under French GAAP, Euro recorded a net profit of €8.1 million (€0.130 per share) for the six months ended June 30, 2022 (€4.4 million in the second quarter), compared to 4. €5 million (€0.072 per share) for the six months ended June 30, 2021 (€1.1 million in the second quarter of 2021). Under IFRS, Euro recorded a net profit of €6.4 million (€0.103 per share) for the six months ended June 30, 2022 (€3.3 million in the second quarter of 2022 (€0.052 per share). )), compared to €3.3 million (€0.054 per share) for the six months ended June 30, 2021 (€1.5 million in the second quarter of 2021). Euro recognized revenue of €10.3 million in the first half of 2022 (€5.5 million in the second quarter of 2022), compared to €5.7 million in the first half of 2021 (2.2 million euros in the second quarter of 2021). On June 9, 2022, Euro paid dividends of €15.6 million (€0.25 per share).
As of June 30, 2022, the amount of cash amounted to €13.3 million, compared to €20.4 million as of December 31, 2021. This decrease, which results mainly from the distribution of dividends, was partially offset by cash generated from operating activities.
Euro holds tradable securities in mining companies operating in a volatile market. Price risk arises from fluctuations in the prices of marketable securities. These investments in marketable securities are accounted for at fair value. As of June 30, 2022, marketable securities included 19,095,345 shares of Orea Mining Corp. (9% of outstanding shares; 9.3% as of December 31, 2021) and 3,819,069 shares of Allegiant Gold Ltd. (3.7% of outstanding shares; 4.9% as of December 31, 2021). Under IFRS, the Company recognised, during the six months ended June 30, 2022, in other comprehensive income, an unrealized loss of €0.6 million resulting from the decline in the fair value of marketable securities (loss of €0.9 million for the six months ended June 30, 2021). According to French accounting standards, the loss of 1.0 million euros was recognized in financial expenses in the income statement.
Under French GAAP and IFRS, Euro recognized revenue of €10.3 million (excluding foreign exchange gains), up from €5.7 million recorded during the same period in 2021 These revenues were exclusively from the Rosebel Mine royalty for the six months ended June 30, 2022 and 2021. The increase in revenues is mainly attributable to the increase in gold production to 74,723 ounces in the first half of 2022 by compared to 47,404 ounces in the same period of 2021 (3.3 million euros), the depreciation of the euro (0.9 million euros), and an average gold price higher by 1,874 US dollars in the first half of 2022, compared to 1,803 US dollars per ounce in the first half of 2021 (0.4 million euros).
Production from the Rosebel mine is expected to be between 113,000 and 139,000 ounces in 2022. The Rosebel royalty is expected to provide the Company with revenue of between approximately €12.3 million and €15.2 million. euros (US$14.8 million and US$18.2 million) in 2022. These pre-tax income are based on a gold price of US$1,700 per ounce and an exchange rate of 1.20 US dollars for 1 euro. The impact of fluctuations in the average gold price on annual Euro revenue, based on an estimated production of 126,000 ounces, would be approximately US$1.2 million for every $100 change per ounce. Commercial production from the Bomboré project is expected to start in the third quarter of 2022.
Euro cash flows are expected to be affected primarily by the payment of income taxes. The Company retains certain available funds in order to pursue opportunities likely to strengthen its business over the long term.
The pandemic continues to evolve. Covid-19 detection and mitigation protocols are continuously reviewed to adapt to the evolving situation. The Company continues to closely monitor this development and take the necessary steps to manage the effects of the pandemic on all aspects of its business.
At the Rosebel site and in Suriname, the situation related to Covid-19 remained stable during the second quarter. In Suriname, the majority of sanitary measures have been lifted, while the wearing of masks remains mandatory indoors at the Rosebel site and other mitigation measures have been implemented to continue to reduce the impact of the pandemic on the site.