Randgold targets higher gold output, gives CEO 36% pay rise
Africa-focused gold miner Randgold Resources (LON:RSS) said Friday is targeting over one million ounces of gold production for the year, adding it is getting close to its long-term goal of 1.2 million ounces by 2015.
The company achieved a 15% increase in production to 910,364 in 2013 at a reduced cash cost of $715 per change and it is now aiming for an increase in production of between 24% and 30%, with costs expected to fall to between $650 and $700 per ounce.
But those were not the only big news delivered in the company’s annual report. The miner also unveiled it has given its chief executive officer Mark Bristow, a 36% pay increase to $7.4 million, after a jump in long-term share payments.
Bristow, who founded Randgold in the 1990s, was paid a $2.57 million bonus on top of his $1.58 million salary last year. Payments under the long-term incentive plan more than doubled to $3.22 million.
Under his management, Randgold Resources has grown to have a market value of $7 billion (4.2 billion pounds) and become the U.K.’s biggest gold producer.
Thanks to Bristow’s conservative policies, the company has not needed to write down its reserves and resources as the gold price dropped, unlike most of its gold peers. This is because Randgold has calculated its reserves at $1,000 per ounce and its resources at $1,500 per once for the past three years.
“We have looked closely at all our mines to ensure that they will still be profitable at US$1 000/oz and we’ll continue to review our operations against a range of gold price scenarios. We’ve also put a solid budget in place for 2014, kept our rolling five year plan intact and are now building this into a ten year plan” he said in a separate statement.
Production growth is expected to come from rising grades at the company’s flagship Loulo-Gounkoto complex in Mali, improved throughput at Tongon in Côte d’Ivoire, and the first full-year contribution from the recently commissioned Kibali in the Democratic Republic of Congo.
The company warned that its reserves fell 8% to 15 million ounces, reflecting the fact that the company ramped up both production and grade during the period, impacting on its inventory.
However, it said, management is confident that Randgold will replenish its reserves through ongoing exploration as well as resource conversion.