Soaring gold prices are helping once-stricken African mining firm Ashanti Gold Fields recover from near collapse three years ago.

A wholesale restructuring completed in June has put the firm's finances back in order, the company said on Tuesday.

Net profits before one-off charges for the April to June period were, at $18.8m (�12.2m), one third higher than last year.

Including the one-time cost of the refinancing - which involved a new $200m credit facility, and raising $75m in new debt and over $40m through new shares - the company made a loss of $3.7m.

Back from the brink

Ashanti had been trying to put itself back together after a near-meltdown in 1999.

At that time, the company found itself deeply in the red after piling up massive losses in gold derivatives, speculating on the future price of the precious metal.

"Hedging", as it is called, is part of normal commodity production operations, a way of smoothing out price gyrations, but Ashanti consistently guessed wrong.

Early in 2000 a rescue was stitched together involving 32% owner Lonmin.

The company is now producing 8% less gold than it was a year ago, it said, while costs have risen 6% to $192 an ounce.

Back in fashion

The rising profits despite the falling production and rising costs comes because gold prices are up 18% over last year to an average of $320 an ounce for the three-month period.

The stock market collapse around the world has put gold back in the spotlight as an investment "safe haven" after a number of years when the price languished.

Still, the rising price presents Ashanti with an all too familiar downside.

The unexpected surge means its hedge book is in the red to the tune of $118m, although its counter-parties will not be asking for any of the money just yet.