Highlands Pacific Ltd: US$10m profit for 2010

HIGHLANDS Pacific Ltd, operator of the Frieda copper/gold project, posted a net profit of US$10.3 million last year, The National reports.

The figure was considered a significant increase from the previous year’s only US$1.1 million.

However, the company’s cash reserves dropped to US$21 million last year from the previous year’s US$24 million.

The key feature in last year’s performance was the gain of US$18 million on the Frieda project, which continued to make significant progress.

Last November, the project moved to the feasibility study stage and last month, the resource inventory increased substantially.

The amount carried in the accounts now reflected the full book value expended by Highlands.

Another contribution was foreign exchange gain of US$1.2 million due to the appreciation in the Australian dollar against the US currency.

The company holds approximately half of its reserves in Australian currency and these are re-valued to US dollars for reporting purposes.

The exploration, evaluation and development expenditure of US$4.3 million provided for expenditure on the Star Mountains programme and ownership costs for the company’s interest in the Ramu nickel cobalt project and the Frieda copper gold project also contributed..

HPL managing director John Gooding said 2010 had been an excellent year with respect to the Frieda project and the exploration programme at Star Mountains.

He said Frieda had made significant progress last year under the management of Xstrata and still had a lot more potential in terms of resource inventory.

“Highlands was one of few smaller market cap companies that has exposure to a tier one multi-decade copper mine of the near future.

“Our Star Mountains exploration programme had allowed Highlands to show its own expertise in exploration management with some very encouraging drilling results early in the programme,” Gooding said.