Celtic Resources announces record profits after an ‘outstanding year’

EXPLORATION company Celtic Resources announced record pre-tax profits of $14.4 million (€11.8 million) yesterday, driven by a once-off gain of $11.7 million from the spin-off of a mining subsidiary.

Like-for-like profits came in at $2.7 million in the year to December 2003, an increase of $0.4 million on the previous year. Turnover increased 30% to $12.1 million.

Chairman Peter Hannen said 2003 was “an outstanding year of progress” and that it marked the third year in a row that Celtic, which is quoted on London’s Alternative Investment Market (AIM), had made a profit. Celtic shares rose more than 2% after the results were announced.

The company plans to transform itself into a major gold miner and has a number of interests in the former Soviet Union. Managing director Kevin Foo said the company would spin off its oil and gas assets after the successful spin-off of mining subsidiary Eureka, which concentrated on the Kazakhstan region.

Celtic’s oil and gas interests are located in Russia and Kazakhstan and will be transferred to a separate company that will also be quoted on the AIM.

The company was successful in producing over 33,000 ounces of gold during the year and plans to grow its annual output to 500,000 ounces. Celtic also expanded an agreement with Investment Group Alrosa that is expected to see the company become Celtic’s single biggest shareholder, with a 23% stake.

Mr Hannen said Celtic would soon complete construction of a new sulphide plant, which would increase the company’s overall gold output.

The company’s share price has risen strongly over the past year and has more than doubled since last July. But the share has retreated from recent highs and is almost 30% lower than the £5.42 peak reached in April.