Shares in African Copper plunged 20 per cent on Monday after the group warned its future 'remains subject to significant risks and uncertainties' and posted a 25m dollar
non-cash impairment loss for the six months to the end of September.
The half-year results revealed a 9% rise in revenue to $29.7m (2012 H1: $27.2m), but the impairment charge resulted in a $29.13m loss.
Excluding the charge, the loss for the period would have been $4.1m, less than half the $9m posted for the same period in 2012.
Jordan Soko, Acting Chief Executive Officer and Director, said: "We are able to report improvements during this six month period in all our key operating measures. This reflects our focus on raising production levels further towards capacity by improving plant efficiency and increasing throughput.
"However, operations during the period were by no means perfect, and our future remains subject to significant risks and uncertainties [...] as reflected in part in the $25m non-cash impairment loss recognised during the period. The directors continue to consider all aspects of our operations and capital structure and the options facing the company."
During the period the company decided to cease mining at Thakadu and move back into the Mowana open pit, which it said would take "significant" operational and capital resources.
"Considering the risks inherent in these activities carefully is a vital exercise and must be measured against the availability of funding from within the group and ZCI [which owns 84.19% of the group]. Discussions will continue with ZCI and we will update the market in the coming months," Soko added.
In terms of production, the group increased the amount of copper produced by 10% to 4,937m tonnes, while income generated from mining operations leapt 51% to $6.5m (2012 H1: $4.3m).
The increase in production would have been significantly greater if not for production problems during the second half of the period, the group admitted, which resulted in a 12% overall reduction in the volume of processed ore.