Eurasia Mining: LON:EUA Share Price Slumps 11% After £2.5m Loss

Mining Firm Weighed Down by Siberian Mine Costs

Shares in Eurasia Mining plummeted by 11% on Monday morning after the FTSE 250-listed mining company revealed a £2.5m loss in its recently concluded financial year.

The London-listed miner, which focuses on platinum group metals and chrome in Russia, saw its share price fall to 10.2 pence in early trading, continuing a downward trend that has seen the company's stock lose more than half of its value over the past 12 months.

Siberian Mine Weighs Down Performance

Eurasia Mining's financial woes stem primarily from the underperforming Monchetundra mine in Siberia, which has been plagued by operational issues and lower metal prices.

The company's annual report, released on Monday, showed that revenue from the mine fell by 17% to £11.2m, while operating costs surged by 25% to £13.7m, leading to a £2.5m operating loss.

Bright Spots Amidst Gloom

Despite the overall negative performance, Eurasia Mining highlighted some positive developments in its annual report.

The company's flagship West Kytlim project in the Urals remains on track for production in 2024, while the company also secured a £10m loan facility from VTB Bank in December 2022.

Analysts Cautious on Outlook

Analysts have expressed caution regarding Eurasia Mining's prospects, citing the ongoing challenges at the Monchetundra mine and the uncertain economic outlook.

In a note to clients, Peel Hunt analysts said: "We remain cautious on the outlook for Eurasia Mining, with the Monchetundra mine continuing to weigh on performance. While the West Kytlim project offers potential upside, we believe this is more than offset by the risks associated with the existing operations."

Share Price May Continue to Fall

Given the challenging outlook, analysts believe that Eurasia Mining's share price could continue to fall in the coming months.

Shore Capital analysts said: "We expect the shares to remain under pressure in the near term, as investors focus on the challenges at Monchetundra and the need for further financing."

Conclusion

Eurasia Mining's share price slump on Monday reflects the company's ongoing challenges at its Siberian mine and the uncertain economic outlook.

Analysts remain cautious on the company's prospects, and the share price could continue to fall in the coming months.