(Reuters) -Britain’s Hochschild Mining slashed full-year production forecast for its Mara Rosa mine by more than half on Wednesday, months after a shutdown due to lacklustre gold output, sending shares down nearly 20%.
The gold mine – Hochschild’s first operation in Brazil – has faced contractor and weather-related disruptions, leading to production delays and reduced output, while costs continued to climb.
The mine’s gold production is now expected to reach only 35,000-45,000 ounces this year, down from its previous forecast of 94,000-104,000 ounces.
Hochschild shares, which fell as much as 19.6% to 246.2 pence, dragged the wider FTSE 350 precious metals and mining index down 2.3% by 0730 GMT.
“Although the guidance downgrades do not catch us by surprise, the cost levels guided for 2025 drive a recalibration to our future forecasts,” RBC Capital Markets analysts said in a note, cutting Hochschild’s price target to 320 pence from 340 pence.
Mara Rosa has since restarted operations, the firm said, and will cost about $29-$30 million in sustaining and developmental expenses this year.
Its minimal contribution to production in the third quarter also led to a cut in total annual gold production to 291,000-319,000 ounces, from 350,000-378,000 ounces.
(Reporting by Yamini Kalia in Bengaluru; Editing by Sherry Jacob-Phillips and Janane Venkatraman)
