'Distinct progress' but Scotgold losses widen

SCOTGOLD Resources, the Aim-listed firm behind Scotland's only commercial gold mine, has reported a widening half-year loss for the period leading up to its flotation last month.

The company, headquartered in Perth, Western Australia, but with an operational focus purely in Scotland, posted a 613,204 pre-tax loss for the six months to 31 December, up from a 205,971 loss a year earlier.

Most of the increase stemmed from rising costs as it prepared for a secondary listing in London. Shares in Scotgold, which was already quoted in Australia, began trading on Aim on 24 February.

Yesterday's results showed higher staff costs as well an increase in fees paid to directors and City advisers.

Last month the company raised 704,000 through a placement ahead of its Aim listing.

The company's plan is to bring its mine at Cononish in the Loch Lomond and the Trossachs National Park into production, and to explore further gold and silver deposits in a vast area beyond, covering 2,200 square kilometres of the central Highlands.

Yesterday it said its inventory stood at 163,000 ounces of gold and 596,000 ounces of silver.

Analysts have estimated that bringing Cononish into production could mean the company has to raise another 12m. In January the company formally submitted planning application for the project.

Chief executive Chris Sangster said Scotgold had made "distinct progress" towards commercialisation.

Shares in Scotgold dropped a quarter of a penny to 6.75p yesterday.