After falling as much as 7.3%, the stock recovers to close S$0.02 lower

 

[SINGAPORE] Shares of Catalist-listed   CNMC Goldmine   : 5TP -1.83% fell as much as 7.3 per cent on Monday (Dec 22) as investors reacted to its Malaysian unit facing additional income tax assessments.

 

The counter fell to an intraday low of S$1.01 seconds after market open, having previously closed at S$1.09, but later pared most of the losses to finish the session 1.8 per cent or S$0.02 down at S$1.07.

 

The Inland Revenue Board of Malaysia on Friday hit CMNM Mining, the company&rsquo s 81 per cent-owned subsidiary, with additional income tax and a penalty worth RM29.6 million (S$9.4 million) for the years of assessment 2019 to 2024.

 

The gold producer said that it &ldquo strongly disagrees&rdquo with the additional tax liability, and will file an appeal to challenge the notices. It added that the notices are not expected to have a material adverse impact on the group&rsquo s going concern or operational viability.

 

In the first 10 months of the year, CNMC Goldmine&rsquo s share price surged over 400 per cent as investors flocked to gold as a safe haven amid geopolitical volatility and economic uncertainty.

 

The increase was so significant that, by November, the gold producer&rsquo s average daily turnover was the fifth highest of any stock outside the Singapore Exchange&rsquo s top 100 by market value.

 

However, CGS International Securities analyst Chua Wei Ren had earlier predicted that the overextended rally would lead to the gold producer&rsquo s share price settling in the range of S$1.03 to S$1.11

 

That forecast turned out to be accurate when gold prices plunged as its rally cooled, with CNMC Goldmine shares falling 5 per cent on Oct 22.

 

In August, the company posted a record net profit of US$15.8 million for the six months ended Jun 30. This marked a 256.1 per cent surge from its US$4.4 million net profit in the year-ago period. 

 

The company recorded a 26 per cent year-on-year increase in gold produced from its carbon-in-leach plant, which stood at 11,811 ounces for H1. 

 

It also logged an average selling price of US$3,197 per ounce of gold produced in the half-year, 41.1 per cent higher than the US$2,266 per ounce in H1 2024.