August 10, 2011 / 8:38 PM / 7 years ago

UPDATE 2-Semafo Q2 profit rises 7 pct on higher gold prices

* Q2 net income at $32.9 mln

* Rev rises 13 pct to $100.4 mln

* Gold production 63,800 ounces (Adds analyst estimates, share milestone, details on company’s properties and exploration costs)

Aug 10 (Reuters) - Gold miner Semafo Inc posted a higher second-quarter profit as soaring gold prices offset lower gold production.

Spot gold prices averaged about $1507.8 an ounce during April-June, up 26 percent since last year as looming debt problems in major economies boosted the interest in precious metal as a haven from risk.

Semafo, which operates the Mana mine in Burkina Faso, the Samira Hill mine in Niger and the Kiniero mine in Guinea, said it was increasing its 2011 exploration budget by $8.5 million for its flagship Mana mine.

Earlier, it had earmarked $30 million in exploration costs at the Mana mine, from which it estimates about 72 percent of total annual production.

The company’s April-June net income rose 7 percent to $32.9 million, or 11 cents per share.

Revenue at Semafo, which has a market value of more than C$2 billion, jumped 13 percent to $100.4 million.

Gold production for the quarter fell 6.5 percent to 63,800 ounces.

Analysts on an average had expected the company to earn 10 cents per share, on revenue of $98.2 million, according to Thomson Reuters I/B/E/S.

Saint-Laurent, Quebec-based Semafo’s shares have gained 6 percent since June 28 when it said follow-up drilling has more than doubled the strike length of gold on its Yaho gold zone in Burkina Faso.

They closed at C$8.66 on Wednesday on the Toronto Stock Exchange. (Reporting by Maneesha Tiwari in Bangalore; Editing by Maju Samuel) (ui)

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