NEW DAWN Mining will hold a special meeting of shareholders next month to address the current business and operational issues the company is facing including low gold prices. Victoria Mtomba Business Reporter
In a statement recently, New Dawn said shareholders are expected to authorise the continuance of the company to the jurisdiction of the Cayman Islands and the consolidation of common shares.
“The substantially lower gold price, together with steadily increasing payroll and power costs and high domestic royalties, taxes and fees have exacerbated a number of operational issues, causing significant operating costs, thus resulting in operating losses and negative cashflows over the past several months,” the company said in a statement.
In August the company closed down one of its mines, Dalny Mine due to operational issues that included the inability of the company to pay its electricity bills on time.
“The company does not expect to reopen the Dalny Mine until operating, liquidity and capital issues have been addressed and resolved,” the statement reads.
New Dawn in its circular to shareholders indicated that it could predict the effect of failing to conclude the indigenisation plan acceptable to the government and stakeholders.
“However, such failure could result in the termination of the company’s mining licences in Zimbabwe, the loss of ownership and/or control of the company’s assets and operations in Zimbabwe without monetary compensation.”
In a trading update, for the first quarter ending March this year and/or New Dawn said Turk Mine and Angelus Mine produced 4 268 ounces, Golden Quarry Camper Down Mine, Dalny Mine 1 948 ounces and 806 ounces during the first quarter to March this year.
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Total gold output for the group in the first quarter was up to 9 253 ounces from 9 069. While revenue for the first quarter stood at $14,9 million compared to $16,6 million while earnings before interest depreciation taxes amortisation for the group stood at $417 446.
