Highland Gold of Russia Says H1 Net Profit Dropped 65%

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(Reuters) – Russian gold miner Highland Gold (HGM.L) said on Wednesday first-half net earnings dropped around 65% year on year to $17 million due to a sharp fall in the gold price.

Gold, which has seen its sharpest decline in cost in a generation, actually deals round $1,300 an ounce, compared with a record top of over $1,920 two years ago.

The company, partially owned by oligarch Roman Abramovich, said it would slash its interim bonus by almost 50% to 2.5 pence ($0.04) per share.

Income was little altered compared with the first half of 2012, at $157 million, Highland Gold said, generating profits before interest, tax, depreciation and amortization of $63 million, down 11.5% year on year.

Eugene Shvidler, Highland Gold’s non-executive head person, said in a statement “The company practices a ‘no hedge’ principle and metal cost fluctuations will extend to sway the Group’s earnings in the future,”