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Gold producer reports second quarter loss

Wednesday, Aug. 18, 1999 | 9:58 a.m.

Henderson-based Alta Gold Co. reported a second-quarter net loss of $2.15 million, or 6 cents per share.

Alta Gold earned $114,000, or less than 1 cent per share, for the year-ago quarter. Revenues in the second quarter more than doubled, to $7.06 million.

Alta Gold said revenues rose steeply because of gold production at its new Olinghouse mine, located 35 miles east of Reno. However, the company still lost money because of increased interest payments on its debt, production difficulties and higher-than-expected production costs at Olinghouse, a decrease in production at its Griffon mine, the marketwide plunge in gold prices and bankruptcy proceeding costs.

Olinghouse was temporarily closed on Aug. 4, idling 75 workers. Alta Gold said the move was necessary to preserve capital.

Alta Gold is currently attempting to sell a 40 percent interest in the Olinghouse mine to an unnamed investor, a move that would allow the company to pay $26 million to creditors and reopen the mine. On Aug. 31, a bankruptcy judge will consider Alta Gold's petition to dismiss its Chapter 11 petition, which would be necessary to sell the mine.

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