Although gold production rose slightly to 149,705 ounces from 148,590oz, a cash cost of $358 against $310 in the previous year kept revenue at $80.3 million from an achieved gold sale price of $505/oz.

“The operating profit was a pleasing result given the difficulties faced by the company over the past year and the tough economic environment for gold producers,” said managing director Peter Cook.

Hill 50, which owns virtually the entire Mt Magnet goldfield – about 550sq.km – spent almost $17 million expanding its Checkers treatment plant, through which it puts ore from its Hill 50 and Star underground mines, as well as numerous open-pit locations within its tenements and free on surface low-grade stocks.

The expansion, along with $23 million spent on capital mine development and $4 million on exploration, was funded out of cash reserves and equity, leaving the company remaining debt free.

Gold production is expected to increase to 208,000oz during the current fiscal year and cash operating costs to drop to $320/oz.

Hill 50 has also downgraded its total proved and probable mining reserves to 1.81 million oz from 2.16Moz and its total identified mineral resources to 4.24Moz from 5.14Moz.