(Reuters) -Hochschild Mining issued a six-week shutdown at its Mara Rosa mine, following lower-than-expected gold output by the end of May, the British precious metals company said on Tuesday, sending shares tumbling down over 20%.
The Brazilian gold mine, which began commercial production in early 2024, has produced just over 25,000 ounces of gold for the January to May period due to heavier-than-expected rainfall and contractor issues.
The company had expected 94,000-104,000 ounces of gold production in 2025.
Shares of the company saw their steepest one-day decline since November 2021, dropping 19.7% to 242 pence by 0747 GMT.
The company will conduct a comprehensive review of all mining, processing, and disposal activities at Mara Rosa to identify bottlenecks and improve output.
“We hope that the end result (after shutdown) is a more flexible pit, aligned to a debottlenecked plant, allowing more stable throughput and more reliable output,” Peel Hunt analysts said in a note, and cut their production estimates of the mine to 60,000 ounces of gold from 84,000 in 2025.
(Reporting by Yamini Kalia in Bengaluru, Editing by Tasim Zahid)
