Caledonia Mining Corporation Plc ("Caledonia" or the
"Company") (NYSE AMERICAN: CMCL; AIM: CMCL; VFEX: CMCL)
announces its operating and financial results for the quarter ended
March 31, 2023 (the "Quarter"). Further information on the
financial and operating results for the Quarter can be found in the
Management Discussion and Analysis ("MD&A") and the unaudited
interim financial statements which are available on the Company's
website and which have been filed on SEDAR.
This Quarter’s results are the first to reflect
Caledonia’s ownership of Bilboes, the acquisition of which was
completed on January 6, 2023. The near-term actions relating to
Bilboes are to re-start oxide mining operations and prepare a
revised feasibility study in respect of the larger sulphide
project. Technical challenges were encountered on re-starting the
oxide mining, but it is hoped that gold mining from near surface
oxide deposits will be cash neutral and will help the Company to
maintain Bilboes’ operational integrity pending completion of the
feasibility study. In addition, the waste material that will be
moved as part of the oxide mining activities is material that would
have had to be moved later when work starts on the main sulphide
project.
As stated in the first quarter production update
dated April 24, Blanket Mine (“Blanket”) suffered some technical
challenges which adversely affected its contribution in the
Quarter. Management believes these challenges have now been
resolved and is encouraged by production and cost data in April and
to date in May. Accordingly, Caledonia reiterates its production
guidance of 75,000-80,000 ounces for Blanket for 2023.
Financial
Highlights
Financial performance
was largely affected, as expected, by the integration and start-up
of the Bilboes operation and technical challenges at Blanket:
- Gross revenues of $29.4 million (Q1
2022: $35.1 million). Lower revenues reflect lower gold production
at Blanket.
- Reduced EBITDA contribution in
the period of $2.25 million (Q1 2022: $14.5 million). The
disappointing contribution was due to lower revenues and higher
operating costs at Blanket and the costs at the Bilboes oxide mine.
Blanket Mine contributed EBITDA of $11.3m in the Quarter (Q1 2022:
$19.5m).
- On-mine cost1 per ounce increased
by almost $500 per ounce from $698 in Q1 2022 to $1,196 per ounce.
Approximately $300 of the increase was due to the Bilboes oxides
mining activities where production only commenced in the last week
of the Quarter, but operating costs were incurred for much of the
Quarter. The on-mine cost per ounce at Blanket increased due to
lower gold production (which meant that fixed costs were spread
across fewer ounces) and higher than anticipated electricity
costs.
- All-in sustaining cost of $1,412
per ounce (Q1 2022: $848 per ounce). The increase was due to the
higher on-mine cost and advisory fees payable on the completion of
the Bilboes acquisition.
- Adjusted loss per share of 29.1
cents (Q1 2022: profit of 62.5 cents). Reduced EBITDA for the
Quarter was exacerbated by higher administrative expenses, a higher
interest charge and an increase in the effective tax rate.
- Net cash outflow from operating
activities of $0.9 million (Q1 2022: net cash inflow of $10.2
million).
- Net cash and cash equivalents of
$3.2 million (Q1 2022: $14.4 million). The net cash position at
March 31, 2023 was negatively impacted by a build-up in undelivered
gold to a value of approximately $2.8 million at the end of the
Quarter pending the implementation of a new gold sale mechanism in
early April. In early April net cash was enhanced by these gold
sales and the receipt of approximately $5.0 million from the
Zimbabwe leg of the equity raise.
- Dividends of 14 cents per share
were paid in January.
___________
1 Non-IFRS measures such as “On-mine cost per ounce”, “AISC”,
“average realised gold price” and “adjusted EPS” are used
throughout this document. Refer to section 10 of the MD&A for a
discussion of non-IFRS measures.
A segmental analysis
showing the summarised financial performance of Blanket and Bilboes
is set out below.
|
Segmental Analysis |
|
|
|
|
|
|
|
|
|
|
|
|
|
Blanket |
|
Bilboes Oxides |
|
Other1 |
|
Consolidated |
|
|
Q1 2023($’m) |
Q1 2022($’m) |
|
Q1 2023($’m) |
Q1 2022($’m) |
|
Q1 2023($’m) |
Q12022($’m) |
|
Q1 2023($’m) |
Q1 2022($’m) |
|
Revenues |
29.3 |
|
35.1 |
|
|
0.2 |
|
- |
|
- |
|
- |
|
|
29.4 |
|
35.1 |
|
|
Royalty |
(1.5 |
) |
(1.8 |
) |
|
- |
|
- |
|
- |
|
- |
|
|
(1.5 |
) |
(1.8 |
) |
|
Production costs |
(16.1 |
) |
(13.7 |
) |
|
(3.3 |
) |
- |
|
(0.4 |
) |
(0.7 |
) |
|
(19.9 |
) |
(14.4 |
) |
|
Depreciation |
(2.8 |
) |
(2.6 |
) |
|
- |
|
- |
|
0.6 |
|
0.5 |
|
|
(2.3 |
) |
(2.1 |
) |
|
Gross profit/(loss) |
8.9 |
|
17.0 |
|
|
(3.2 |
) |
- |
|
0.2 |
|
(0.2 |
) |
|
5.9 |
|
16.8 |
|
|
Other2 |
(0.4 |
) |
(0.1 |
) |
|
(0.3 |
) |
- |
|
(5.2 |
) |
(4.3 |
) |
|
(5.9 |
) |
(4.4 |
) |
|
Net finance cost |
(0.5 |
) |
(0.2 |
) |
|
(0.1 |
) |
- |
|
(0.4 |
) |
0.1 |
|
|
(0.8 |
) |
(0.1 |
) |
|
Profit/(loss) before tax |
8.0 |
|
16.7 |
|
|
(3.4 |
) |
- |
|
(5.4 |
) |
(4.4 |
) |
|
(0.8 |
) |
12.3 |
|
|
Taxation |
(3.0 |
) |
(4.4 |
) |
|
- |
|
- |
|
(0.5 |
) |
(0.3 |
) |
|
(3.5 |
) |
(4.7 |
) |
|
(Loss)/profit after tax |
5.0 |
|
12.3 |
|
|
(3.4 |
) |
|
|
(5.9 |
) |
(4.7 |
) |
|
(4.3 |
) |
7.6 |
|
Source: note 24 to the
unaudited interim financial statements for the Quarter
- Comprises costs relating to the
South African operations, intergroup eliminations and adjustments,
and corporate and other reconciling amounts.
- Comprises other income, other
expenses, administrative expenses, cash and equity settled
share-based expenses, net foreign exchanges gains and losses and
fair value loss on derivative instruments.
Safety
- Regrettably, a fatality occurred on
February 16, 2023 as a result of a secondary blasting accident. The
directors and management of Caledonia and Blanket express their
sincere condolences to the family and colleagues of the deceased.
Management has provided the necessary assistance to the Ministry of
Mines Inspectorate Department in its enquiries into the
incident.
Operating
Highlights
- 16,141 ounces of gold produced in
the Quarter (Q1 2022: 18,515 ounces) of which 16,036 ounces were
produced at Blanket and 105 ounces were produced at the Bilboes
oxide mine. Gold produced in the Quarter was lower due to lower
mine production at Blanket than anticipated and the
slower-than-expected restart of the Bilboes oxide mine.
- Production at Blanket was lower
than expected due to minor mechanical breakdowns and logistical
issues which have now been resolved. The rate of production
improved in April with 5,202 ounces of gold being produced in the
month (which has 23 scheduled production days due to public
holidays and production cut-off), which equates to an annualised
production rate of approximately 80,000 ounces per annum.
- The Company is reviewing the
commercial viability of the low margin oxides mining activities,
which includes assessing the scope to mine and process oxide
material from the recently acquired Motapa property, which is
immediately adjacent to Bilboes. Approximately 217 ounces of gold
were produced from the Bilboes oxide mine in April; a further
approximately 338 ounces of gold was contained in material that was
deposited onto the leach pad in April and is expected to report to
production in May.
- The 12.2MWac solar plant was fully
commissioned on February 2, 2023 and is generating slightly more
power than anticipated.
Outlook
- Production guidance for Blanket for
the year to December 31, 2023 of between 75,000 and 80,000 ounces
of gold is maintained.
- On mine costs at Blanket are
expected to fall in future quarters due to increased production and
lower electricity costs. Accordingly, guidance for on-mine costs at
Blanket for 2023 is maintained at the range of $770 to $850 per
ounce of gold produced at Blanket.
- Guidance for consolidated all-in
sustaining costs per ounce was between $1,150 and $1,250 per ounce,
which included the anticipated production and associated costs at
the Bilboes oxide mine in respect of which production and cost
guidance has been withdrawn. Guidance for AISC is re-stated to
exclude production and related production costs at the Bilboes
oxide mine. AISC excluding Bilboes oxides is
expected to be in the range of $935 to $1,035 per ounce.
- Deep level drilling at Blanket has
re-commenced with the objectives of upgrading inferred mineral
resources and identifying new resources thereby extending the life
of mine.
- The feasibility study on the
Bilboes sulphide project should be completed in Q1 2024 with the
objective of maximising value accretion for Caledonia’s
shareholders.
Commentary
The inclusion, for the
first time, of Bilboes in this Quarter’s report inevitably makes it
difficult to carry out like-for-like comparisons with the
equivalent quarter in 2022.
Production from
Blanket in the Quarter was below target due to equipment failures
and logistical issues. These included two separate failures of the
No.4 Shaft winder and a persistent blockage in an ore-pass at
Central Shaft which required alternative tramming arrangements
which were more expensive and reduced tramming capacity. These
issues have been resolved and production in April has been higher
than expected, equating to an annualised production rate of
approximately 80,000 ounces of gold per annum. This improved
performance has continued into May and we confirm production
guidance from Blanket for the year to December 31, 2023 in the
range of 75,000 to 80,000 ounces.
The increased on-mine cost per ounce was due to
the high cost per ounce at the Bilboes oxide mine where production
only commenced in the last week of the Quarter. The remainder of
the increase was due to higher on-mine costs at Blanket where lower
production meant that fixed costs were spread across fewer
production ounces and a higher electricity use. The increased
electricity cost was a combination of higher consumption due to the
continued heavy use of certain elements of infrastructure which had
been expected to be used more sparingly and an increase in the
tariff for grid power. From April, Blanket has seen a reduction on
the cost of grid power following the implementation of alternative
supply arrangements on April 1.
The 12.2MWac solar plant was commissioned in
February and generated slightly more power than anticipated and has
contributed to a substantial reduction in the amount of diesel
consumed at Blanket.
In January, Caledonia announced that it had
satisfied the conditions precedent to purchase Bilboes, a large,
high-grade gold deposit located approximately 75 km north of
Bulawayo. The main objective at Bilboes is to construct a large,
open-pit operation to extract sulphide resources. Work on a revised
feasibility study has commenced, with the objective of identifying
the optimal way to commercialise the Bilboes sulphide project with
a view to maximizing the uplift in value for Caledonia
shareholders.
The start-up of the additional, small oxide
mining and processing activity at Bilboes was affected by
contractors’ drill rigs underperforming and variations between the
realised and anticipated grade at the first target mining area. We
are evaluating other target areas for oxide mining - both at
Bilboes and next door at Motapa with the objective of focusing
future mining on areas where we have a high confidence level in the
target mining areas. Caledonia has withdrawn guidance for the oxide
mining activity and in future will report production and costs
retrospectively.
Mark
Learmonth, Chief Executive Officer, commented:
“The first quarter of 2023 presented several
operational challenges at Blanket which resulted in lower
production and higher costs. We are confident these issues have
been identified and addressed, and we reiterate our production
guidance for Blanket of between 75,000 and 80,000 ounces of
gold.
"We were pleased to complete the acquisition of
Bilboes at the start of the Quarter. Although the start-up of the
Bilboes oxide mining activity was disappointing, this does not
detract from the attraction of the main sulphide project.
“The sulphide resource is based on direct
drilling results and has been subjected to independent third-party
reviews. Caledonia has commenced work on a revised feasibility
study for the sulphide project which will consider updated
commercial assumptions and will focus on the most judicious way to
commercialise this project with the objective of maximising value
for Caledonia shareholders.
“Following Caledonia’s oversubscribed fundraise
in March and April, which raised approximately $16.5m, our balance
sheet and operational flexibility have been improved and we are
delighted to have new shareholders on our register who believe in
our vision, and we hope will support us in the next stage of our
growth.”
Conference Call Details
A presentation of the results for the Quarter
and outlook for Caledonia is available on Caledonia's website
(www.caledoniamining.com). Management will host a conference call /
webinar at 3pm London time on May 16, 2023.
When: May 16, 2023 – 3pm London time
Topic: Q1 2023 Shareholder Call
Register in advance for this webinar:
https://caledoniamining.zoom.us/webinar/register/WN_5VLZvSeeQyOZ0BAr1saBqA
After registering, you will receive a confirmation email
containing information about joining the webinar.
Enquiries:
|
Caledonia Mining Corporation PlcMark
LearmonthCamilla Horsfall |
Tel: +44 1534 679 800Tel: +44
7817 841 793 |
| Cenkos Securities plc
(Nomad and Joint Broker)Adrian Hadden Neil McDonaldPearl
Kellie |
Tel: +44 207 397 1965Tel:
+44 131 220 9771Tel: +44 131 220 9775 |
| Liberum Capital Limited
(Joint Broker)Scott Mathieson/Kane Collings |
Tel: +44 20 3100 2000 |
| BlytheRay Financial PR
(UK)Tim Blythe/Megan Ray |
Tel: +44 207 138 3204 |
| 3PPB (Financial PR, North
America)Patrick ChidleyPaul Durham |
Tel: +1 917 991 7701Tel: +1
203 940 2538 |
| Curate Public Relations
(Zimbabwe)Debra Tatenda |
Tel: +263 77802131 |
| IH Securities (Private)
Limited (VFEX Sponsor - Zimbabwe)Lloyd Mlotshwa |
Tel: +263 (242) 745
119/33/39 |
Note: This announcement contains inside
information which is disclosed in accordance with the Market Abuse
Regulation (EU) No. 596/2014 (“MAR”)
as it forms part of UK domestic law by virtue of the
European Union (Withdrawal) Act 2018 and is disclosed in accordance
with the Company's obligations under Article 17 of
MAR.
Cautionary Note Concerning
Forward-Looking Information
Information and statements contained in this
news release that are not historical facts are “forward-looking
information” within the meaning of applicable securities
legislation that involve risks and uncertainties relating, but not
limited, to Caledonia’s current expectations, intentions, plans,
and beliefs. Forward-looking information can often be identified by
forward-looking words such as “anticipate”, “believe”, “expect”,
“goal”, “plan”, “target”, “intend”, “estimate”, “could”, “should”,
“may” and “will” or the negative of these terms or similar words
suggesting future outcomes, or other expectations, beliefs, plans,
objectives, assumptions, intentions or statements about future
events or performance. Examples of forward-looking information in
this news release include: production guidance, estimates of
future/targeted production rates, and our plans and timing
regarding further exploration and drilling and development. This
forward-looking information is based, in part, on assumptions and
factors that may change or prove to be incorrect, thus causing
actual results, performance or achievements to be materially
different from those expressed or implied by forward-looking
information. Such factors and assumptions include, but are not
limited to: failure to establish estimated resources and reserves,
the grade and recovery of ore which is mined varying from
estimates, success of future exploration and drilling programs,
reliability of drilling, sampling and assay data, assumptions
regarding the representativeness of mineralization being
inaccurate, success of planned metallurgical test-work, capital and
operating costs varying significantly from estimates, delays in
obtaining or failures to obtain required governmental,
environmental or other project approvals, inflation, changes in
exchange rates, fluctuations in commodity prices, delays in the
development of projects and other factors.
Security holders, potential security holders and
other prospective investors should be aware that these statements
are subject to known and unknown risks, uncertainties and other
factors that could cause actual results to differ materially from
those suggested by the forward-looking statements. Such factors
include, but are not limited to: risks relating to estimates of
mineral reserves and mineral resources proving to be inaccurate,
fluctuations in gold price, risks and hazards associated with the
business of mineral exploration, development and mining, risks
relating to the credit worthiness or financial condition of
suppliers, refiners and other parties with whom the Company does
business; inadequate insurance, or inability to obtain insurance,
to cover these risks and hazards, employee relations; relationships
with and claims by local communities and indigenous populations;
political risk; risks related to natural disasters, terrorism,
civil unrest, public health concerns (including health epidemics or
outbreaks of communicable diseases such as the coronavirus
(COVID-19)); availability and increasing costs associated with
mining inputs and labour; the speculative nature of mineral
exploration and development, including the risks of obtaining or
maintaining necessary licenses and permits, diminishing quantities
or grades of mineral reserves as mining occurs; global financial
condition, the actual results of current exploration activities,
changes to conclusions of economic evaluations, and changes in
project parameters to deal with unanticipated economic or other
factors, risks of increased capital and operating costs,
environmental, safety or regulatory risks, expropriation, the
Company’s title to properties including ownership thereof,
increased competition in the mining industry for properties,
equipment, qualified personnel and their costs, risks relating to
the uncertainty of timing of events including targeted production
rate increase and currency fluctuations. Security holders,
potential security holders and other prospective investors are
cautioned not to place undue reliance on forward-looking
information. By its nature, forward-looking information involves
numerous assumptions, inherent risks and uncertainties, both
general and specific, that contribute to the possibility that the
predictions, forecasts, projections and various future events will
not occur. Caledonia undertakes no obligation to update publicly or
otherwise revise any forward-looking information whether as a
result of new information, future events or other such factors
which affect this information, except as required by law.
This news release is not an offer of the shares
of Caledonia for sale in the United States or elsewhere. This news
release shall not constitute an offer to sell or the solicitation
of an offer to buy, nor shall there be any sale of the shares of
Caledonia, in any province, state or jurisdiction in which such
offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of such province, state
or jurisdiction.
|
Condensed Consolidated Statements of profit or loss and
Other comprehensive income (Unaudited) |
|
|
|
|
|
|
($’000’s) |
3 months endedMar 31 |
|
|
|
2023 |
2022 |
|
|
Revenue |
29,435 |
|
35,072 |
|
|
|
Royalty |
(1,480 |
) |
(1,758 |
) |
|
|
Production
costs |
(19,850 |
) |
(14,359 |
) |
|
|
Depreciation |
(2,255 |
) |
(2,063 |
) |
|
|
Gross profit |
5,850 |
|
16,892 |
|
|
|
Other income |
18 |
|
2 |
|
|
|
Other
expenses |
(640 |
) |
(793 |
) |
|
|
Administrative
expenses |
(5,938 |
) |
(2,371 |
) |
|
|
Net foreign
exchange gain |
1,533 |
|
909 |
|
|
|
Cash-settled
share-based expense |
(280 |
) |
(367 |
) |
|
|
Equity-settled
share-based expense |
(110 |
) |
(82 |
) |
|
|
Net derivative
financial instrument expenses |
(434 |
) |
(1,738 |
) |
|
|
Operating (loss)
profit |
(1 |
) |
12,452 |
|
|
|
Net finance
costs |
(767 |
) |
(116 |
) |
|
|
(Loss)
profit before tax |
(768 |
) |
12,336 |
|
|
|
Tax expense |
(3,502 |
) |
(4,719 |
) |
|
|
(Loss)
profit for the period |
(4,270 |
) |
7,617 |
|
|
|
|
|
|
|
|
Other
comprehensive (loss) income |
|
|
|
|
Items that
are or may be reclassified to profit or loss |
|
|
|
|
Exchange
differences on translation of foreign operations |
(369 |
) |
693 |
|
|
|
Total
comprehensive (loss) income for the period |
(4,639 |
) |
8,310 |
|
|
|
|
|
|
|
|
(Loss)
profit attributable to: |
|
|
|
|
Owners of the
Company |
(5,030 |
) |
5,940 |
|
|
|
Non-controlling
interests |
760 |
|
1,677 |
|
|
|
(Loss)
profit for the period |
(4,270 |
) |
7,617 |
|
|
|
|
|
|
|
|
Total
comprehensive (loss) income attributable to: |
|
|
|
|
Owners of the
Company |
(5,399 |
) |
6,633 |
|
|
|
Non-controlling
interests |
760 |
|
1,677 |
|
|
|
Total
comprehensive (loss) income for the period |
(4,639 |
) |
8,310 |
|
|
|
|
|
|
|
|
(Loss)
earnings per share (cents) |
|
|
|
|
Basic |
(30.3 |
) |
44.6 |
|
|
|
Diluted |
(30.2 |
) |
44.6 |
|
|
|
Adjusted
(loss) earnings per share (cents) |
|
|
|
|
Basic |
(29.1 |
) |
62.5 |
|
|
|
Dividends paid per share (cents) |
14.0 |
|
14.0 |
|
|
Condensed Consolidated Statements of Cash Flows
(Unaudited) |
|
|
|
($’000’s) |
|
|
|
|
|
3 months endedMarch 31 |
|
|
|
2023 |
2022 |
|
|
|
|
|
|
Cash inflow from operations |
|
664 |
|
11,844 |
|
| Interest
received |
|
5 |
|
1 |
|
| Net
finance costs paid |
|
(200 |
) |
(31 |
) |
| Tax
paid |
|
(1,345 |
) |
(1,659 |
) |
|
Net cash (outflow) inflow from operating
activities |
|
(876 |
) |
10,155 |
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
Acquisition of property, plant and equipment |
|
(4,593 |
) |
(9,734 |
) |
|
Acquisition of exploration and evaluation assets |
|
(144 |
) |
(224 |
) |
|
Net cash outflow from investing activities |
|
(4,737 |
) |
(9,958 |
) |
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
| Dividends
paid |
|
(2,424 |
) |
(1,788 |
) |
| Payment
of lease liabilities |
|
(37 |
) |
(40 |
) |
| Shares
issued - equity raise (net of transaction cost) |
|
10,823 |
|
- |
|
| Loan note
instruments - Motapa payment |
|
(5,399 |
) |
- |
|
| Loan note
instruments - Solar bond issue receipts |
|
4,500 |
|
- |
|
|
Net cash inflow (outflow) from financing
activities |
|
7,463 |
|
(1,828 |
) |
|
|
|
|
|
|
Net increase (decrease) in cash and cash
equivalents |
|
1,850 |
|
(1,631 |
) |
| Effect of
exchange rate fluctuations on cash and cash equivalents |
|
(157 |
) |
(204 |
) |
| Net cash
and cash equivalents at beginning of the period |
|
1,496 |
|
16,265 |
|
|
Net cash and cash equivalents at end of the
period |
|
3,189 |
|
14,430 |
|
|
Summarised Consolidated Statements of Financial Position
(Unaudited) |
|
($’000’s) |
As at |
|
Mar 31 |
Dec 31 |
|
|
|
|
2023 |
2022 |
|
Total non-current assets |
|
|
269,069 |
196,764 |
|
Inventories |
|
|
18,477 |
18,334 |
|
Prepayments |
|
|
3,356 |
3,693 |
| Trade and
other receivables |
|
|
9,957 |
9,185 |
| Income
tax receivable |
|
|
82 |
40 |
| Cash and
cash equivalents |
|
|
19,021 |
6,735 |
|
Derivative financial assets |
|
|
6 |
440 |
|
Total assets |
|
|
319,968 |
235,191 |
|
Total non-current liabilities |
|
|
13,196 |
9,291 |
| Loan
notes payable – short term portion |
|
|
2,514 |
7,104 |
| Lease
liabilities – short term portion |
|
|
136 |
132 |
| Trade and
other payables |
|
|
26,048 |
17,454 |
| Income
tax payable |
|
|
2,210 |
1,324 |
|
Overdraft |
|
|
15,832 |
5,239 |
| Cash-settled
share-based payments - short term portion |
|
482 |
1,188 |
|
Total liabilities |
|
|
60 412 |
41,732 |
|
Total equity |
|
|
259,550 |
193,459 |
|
Total equity and liabilities |
|
|
319 968 |
235,191 |
Caledonia Mining (AMEX:CMCL)
Graphique Historique de l'Action
De Sept 2024 à Oct 2024
Caledonia Mining (AMEX:CMCL)
Graphique Historique de l'Action
De Oct 2023 à Oct 2024
