Lihir Gold Limited

Lihir Gold Limited

February 19, 2009 06:30 ET

LGL's (Lihir Gold) Fiscal 2008 Financial Results to Dec. 31

LGL Reports Record Year with 54% Jump in Profit

PORT MORESBY, PAPUA NEW GUINEA--(Marketwire - Feb. 19, 2009) - Lihir Gold Ltd (TSX:LGG)(ASX:LGL)(NASDAQ:LIHR) ("LGL") is pleased to announce the release of its Fiscal 2008 Financial Results for the period ended December 31, 2008.

Record gold production and rising gold prices have enabled LGL to report a 54% increase in underlying profit(i) to $184.9 million for the year to December 2008.

The Company reported its third successive year of record production, at 882,000 ounces, which was up 26% from 702,000 ounces in 2007. The increase was due to significantly higher output at the cornerstone Lihir Island operation in PNG, and because of the inclusion of production from the Bonikro mine in Cote d'Ivoire and the Mt Rawdon mine in Queensland. These mines were acquired by LGL as part of its acquisition of Equigold NL in June 2008.

Revenues increased by 52% to a record US$756 million, driven by a 23% increase in gold sales volume and a 29% rise in the gold price. For the full year 868,927 ounces of gold were sold at an average cash price of US$850 an ounce, up from US$666 an ounce in 2007.

Total cash costs were US$400 per ounce in 2008, which continues to position the company at the lower end of the global gold production cost curve. Unit costs trended lower over the course of 2008, with total cash costs reducing to $353 per ounce in the December quarter.

Aggregate operating costs for the year totalled $463 million, up from $306 million in 2007, as a result of continuing cost pressures across the mining sector, higher oil prices for most of the year and because of higher throughput at Lihir Island.

LGL Managing Director Arthur Hood said the solid 2008 result reflected an outstanding performance from the cornerstone Lihir Island operation and the benefits of the merger with Equigold NL. "Going into 2009 LGL's financial position is very secure. We have healthy operating cashflows and widely diversified revenue and production sources. The company has a strong foundation to enable future investment in growth opportunities and to deliver maximum value for shareholders."

In 2009 group-wide gold production is forecast to increase by more than 10 percent to in excess of one million ounces. This is expected to include another year of record gold output from Lihir Island at between 770,000 and 840,000 ounces, approximately 130,000 - 160,000 ounces from Bonikro as it delivers its first full year of production, 90,000 - 100,000 ounces from Mt Rawdon confirming its track record of consistent production; and 50,000 - 100,000 ounces from Ballarat.

Falling oil prices and favourage exchange rate movements are expected to drive a reduction in total cash costs in 2009 to less than US$400 per ounce.

"In 2008 we firmly established LGL as a global gold producer with growing production and exciting exploration opportunities. I'm confident the next 12 months will see a continuation in the group's exciting growth journey," Mr Hood said.

(i) Underlying profit before non-cash hedging losses, hedge restructuring costs and non-recurring costs.

Documents relating to these results, including the Financial Results, Management Discussion and Analysis and an overview presentation, will be available on SEDAR shortly at ( and on the Company's website: Also, a recording of the Company's discussion of these results will be available shortly on LGL's website.

Contact Information