Caledonia Mining Corporation Plc ("Caledonia" or “the
Company") (NYSE AMERICAN: CMCL; AIM: CMCL; VFEX: CMCL) announces
its operating and financial results for the quarter and the nine
months ended September 30, 2024 (the "Quarter" and "nine
months" respectively). Further information on the financial
and operating results for both can be found in the management
discussion and analysis ("MD&A") and the unaudited financial
statements, which are available on the Company's website and are
being filed on SEDAR+ and EDGAR.
Financial and
Corporate Highlights
-
Revenues in the Quarter of $46.9 million; nine months’ revenue of
$135.5 million.
-
Gross profit in the Quarter of $19.3 million increased from
$14.1 million in the third quarter of 2023 (the “comparable
quarter" or “Q3 2023”) due to the higher gold price and lower costs
of the Bilboes oxide mine.
-
Consolidated on-mine cost per ounce for the Quarter of $1,056 (Q3
2023: $928). The increase was mainly due to lower ounces sold
and higher production costs at Blanket.
-
The group’s all-in sustaining cost ("AISC") for the Quarter
was $1,501 per ounce (Q3 2023: $1,268 per ounce), the increase
being due to lower ounces sold, higher on-mine costs (primarily
labour and electricity) and increased cash-settled share-based
payment expenses in the Quarter due to the increase in Caledonia's
share price.
-
Basic IFRS earnings per share ("EPS") for the Quarter of 12.0
cents (Q3 2023: 24.1 cents).
-
Adjusted EPS1 for the Quarter of 26.2 cents (Q3
2023: 29.9 cents).
-
Net cash from operating activities in the Quarter was $4.6 million,
lower than the $14.5 million earned in the comparable quarter due
to lower operating profits, increased realised foreign exchange
losses due to the devaluation of the Zimbabwean currency (“ZiG”),
increased tax payments due to timing of payments, and increased
working capital due to accelerating spend on inventory levels
during the Quarter to support preventative maintenance initiatives
and reduce potential production delays. Operating cashflow in the
Quarter before working capital movements was $16.2 million (Q3
2023: $16.3 million).
-
A further dividend of 14 cents per share has been declared on
November 11, 2024 and will be paid on December 6, 2024. To
streamline the administration relating to board processes, and as
previously announced, dividends are now expected to be approved at
the same time as the publication of quarterly results.
Operational
Summary
- Regrettably, a fatality occurred on
September 21, 2024 as a result of a rock fall while a Blanket mine
employee was performing support drilling activities in a decline
area. Caledonia takes the safety of its employees very seriously
and, accordingly, measures have been taken to reinforce adherence
to prescribed safety procedures.
- Quarterly gold production of 18,992
ounces was lower than the 21,772 ounces produced in the comparable
quarter (which established a new production record) due to lower
grade and reduced metallurgical recoveries.
- Gold produced in the nine months
was 56,815 ounces (nine months 2023: 55,244 ounces) at
Blanket.
- Caledonia reiterates gold
production guidance for 2024 of between 74,000 and 78,000 ounces2
at Blanket.
-
On-mine cost guidance for 2024 at Blanket has increased to between
$950 and $1,050 per ounce from the previous guidance of $870 to
$970 per ounce due to higher labour and electricity costs.
Management is pursuing initiatives to achieve cost reductions in
both of these areas.
- A conditional sale agreement to
sell the company which owns the 12.2MWac solar plant
for $22.35 million, payable in cash, was signed on September
30, 2024. Upon completion of the sale, Caledonia will realise a
profit on the $14.3 million construction cost while
Blanket will retain the exclusive supply of energy.
-
$2.3 million increase in inventory levels during the Quarter to
support preventative maintenance initiatives and reduce potential
production delays. $2.7 million planned in the last quarter of
2024.
-
Caledonia has published encouraging results from its recent
exploration programme at Motapa, which comprised deeper drilling
below historic open pits and shallower drilling in a new target
area.
Strategy and Outlook: increased focus on growth
opportunities
The immediate strategic focus is to:
-
Maintain production at Blanket at the targeted range of 74,000 to
78,000 ounces for 2024 and at a similar level for 2025;
- Complete the
Caledonia feasibility study on the Bilboes sulphide project
(expected first quarter of 2025); progress development funding
solutions; commence development of the sulphide project; and
- Continue with
exploration activities at Motapa.
Commenting on the
announcement, Mark Learmonth, Chief Executive Officer,
said:
“I am pleased to report that production for the
Quarter was in line with expectations and we remain on track to
meet our production guidance for the year.
“Regrettably, during the Quarter we had a
fatality at Blanket. I would like to extend our condolences to the
family and friends of the deceased. We remain committed to
improving our safety performance and delivering a zero-harm
environment.
“We continue to explore ways to reduce on-mine
costs at Blanket – particularly the cost of electricity and labour
where several initiatives are being implemented and further
measures are under consideration.
“In parallel, we continue to carefully manage
our cashflows and working capital, albeit we have made the
strategic decision to accelerate investment in inventory levels
during the Quarter to support preventative maintenance initiatives
and reduce potential production delays. This investment would have
previously been scheduled for 2025. Our cash reserves have also
been negatively impacted by the currency devaluation in Zimbabwe
during the Quarter.
“During the Quarter, Caledonia announced the
signing of a conditional sale agreement to sell the subsidiary that
owns the 12.2MWac solar plant which supplies power to Blanket
for $22.35 million. Completion of the sale will return capital
to Caledonia at a key moment in the Company's growth trajectory
while retaining the exclusive energy offtake, ensuring
approximately 20% of Blanket’s daily electricity requirement
continues to be met by renewable power.
“Blanket remains a solid foundation for our
growth profile in Zimbabwe; our exploration activities at both
Blanket and Motapa continue to deliver encouraging results, playing
to our future growth ambitions.
“We continue to progress the revised feasibility
study for the Bilboes sulphide project with a focus on capital
allocation and expect to complete this in the first quarter of
2025. We are also making encouraging progress towards identifying
and implementing a funding structure for Bilboes with the objective
of minimising equity dilution and optimising the uplift in net
present value per Caledonia share. We are excited by this
opportunity to evolve our business and expand our production
profile, which we believe will generate significant long term
shareholder value.”
Caledonia will host an online
presentation and Q&A session open to all investors on 11
November at 14.00 London Time
You are invited to a
Zoom webinar.
When: Nov 11, 2024
02:00 PM London
Topic: Q3 2024 Results
call for Investors
Register in advance
for this webinar:
https://caledoniamining.zoom.us/webinar/register/WN_ZHTT-Ji5RDylrtSaSYE0fA
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 |
|
Cavendish Capital Markets
Limited (Nomad and Joint Broker)Adrian Hadden Pearl
Kellie |
Tel: +44 207 397 1965Tel:
+44 131 220 9775 |
|
Panmure Liberum Limited
(Joint Broker)Scott MathiesonMatt Hogg |
Tel: +44 20 3100 2000 |
|
Camarco, Financial PR
(UK)Gordon PooleJulia TilleyElfie Kent |
Tel: +44 20 3757 4980 |
|
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 |
Craig James Harvey, MGSSA, MAIG, Caledonia Vice
President, Technical Services, has reviewed and approved the
scientific and technical information contained in this news
release. Craig James Harvey is a "Qualified Person" as defined by
each of (i) the Canadian Securities Administrators' National
Instrument 43-101 - Standards of Disclosure for Mineral Projects
and (ii) sub-part 1300 of Regulation S-K of the U.S. Securities
Act.
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” or “forward-looking statements” within the meaning of
applicable securities legislation (collectively, “forward-looking
information”) 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 and cost guidance, estimates of future/targeted
production rates, our plans and timing regarding further
exploration and drilling and development at Motapa, the development
of the Bilboes Sulphide Project, the continuation of dividend
payments, the currency devaluation in Zimbabwe, and our plans and
timing regarding the completion of the sale of the 12.2MWac solar
plant. 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 information. 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.
Condensed Consolidated Statements of profit or loss and
Other comprehensive income (Unaudited) |
|
($’000’s) |
|
|
|
|
|
|
3 months ended September 30 |
9 months ended September 30 |
|
|
2024 |
2023 |
2024 |
2023 |
|
Revenue |
46,868 |
41,187 |
135,503 |
107,653 |
|
Royalty |
(2,422) |
(2,207) |
(6,831) |
(5,650) |
|
Production costs |
(21,085) |
(20,452) |
(60,505) |
(61,028) |
|
Depreciation |
(4,048) |
(4,385) |
(12,106) |
(10,049) |
|
Gross
profit |
19,313 |
14,143 |
56,061 |
30,926 |
|
Net foreign exchange loss |
(3,129) |
(257) |
(9,282) |
(2,334) |
|
Administrative expenses |
(3,954) |
(2,889) |
(10,229) |
(11,890) |
|
Net derivative financial
instrument expenses |
(20) |
(102) |
(496) |
(590) |
|
Equity-settled share-based
expense |
(279) |
(233) |
(785) |
(564) |
|
Cash-settled share-based
expense |
(422) |
(27) |
(479) |
(298) |
|
Other expenses |
(2,814) |
(701) |
(4,078) |
(2,800) |
|
Other income |
16 |
62 |
365 |
127 |
|
Operating
profit |
8,711 |
9,996 |
31,077 |
12,577 |
|
Net finance costs |
(824) |
(508) |
(2,344) |
(2,332) |
|
Profit before
tax |
7,887 |
9,488 |
28,733 |
10,245 |
|
Tax expense |
(4,600) |
(3,777) |
(12,281) |
(8,552) |
|
Profit for the
period |
3,287 |
5,711 |
16,452 |
1,693 |
|
|
|
|
|
|
|
Other comprehensive
income |
|
|
|
|
|
Items that are or may
be reclassified to profit or loss |
|
|
|
|
|
Exchange differences on
translation of foreign operations |
629 |
(79) |
663 |
(778) |
|
Total comprehensive
income for the period |
3,916 |
5,632 |
17,115 |
915 |
|
|
|
|
|
|
|
Profit (loss)
attributable to: |
|
|
|
|
|
Owners of the Company |
2,267 |
4,506 |
12,827 |
(1,036) |
|
Non-controlling interests |
1,020 |
1,205 |
3,625 |
2,729 |
|
Profit for the
period |
3,287 |
5,711 |
16,452 |
1,693 |
|
|
|
|
|
|
|
Total comprehensive
income attributable to: |
|
|
|
|
|
Owners of the Company |
2,896 |
4,427 |
13,490 |
(1,814) |
|
Non-controlling interests |
1,020 |
1,205 |
3,625 |
2,729 |
|
Total comprehensive
income for the period |
3,916 |
5,632 |
17,115 |
915 |
|
|
|
|
|
|
|
Earnings (loss) per
share (cents) |
|
|
|
|
|
Basic |
12.0 |
24.1 |
65.5 |
(6.8) |
|
Diluted |
12.0 |
24.0 |
65.5 |
(6.8) |
|
Adjusted earnings per
share (cents) |
|
|
|
|
|
Basic |
26.2 |
29.9 |
84.9 |
6.0 |
|
Dividends paid per share (cents) |
14.0 |
14.0 |
42.0 |
56.0 |
Summarised Consolidated Statements of Financial Position
(Unaudited) |
($’000’s) |
As at |
Sep-30 |
Dec-31 |
|
|
2024 |
2023 |
Total non-current assets |
|
279,803 |
274,074 |
Income
tax receivable |
|
70 |
1,120 |
Inventories |
|
22,732 |
20,304 |
Derivative financial assets |
|
- |
88 |
Trade and
other receivables |
|
9,651 |
9,952 |
Prepayments |
|
6,717 |
2,538 |
Cash and
cash equivalents |
|
7,204 |
6,708 |
Assets
held for sale |
|
13,483 |
13,519 |
Total assets |
|
339,660 |
328,303 |
Total non-current liabilities |
|
26,307 |
23,978 |
Cash-settled share-based payments - short term portion |
|
1,081 |
920 |
Income
tax payable |
|
2,244 |
10 |
Lease
liabilities – short term portion |
|
94 |
167 |
Loan
notes – short term portion |
|
855 |
665 |
Trade and
other payables |
|
22,278 |
20,503 |
Overdraft
and term loans |
|
14,839 |
17,740 |
Liabilities associated with assets held for sale |
|
98 |
128 |
Total liabilities |
|
67,796 |
64,111 |
Total equity |
|
271,864 |
264,192 |
Total equity and liabilities |
|
339,660 |
328,303 |
Condensed Consolidated Statements of Cash Flows
(Unaudited) |
|
|
|
|
($’000’s) |
|
|
|
|
|
3 months ended September
30 |
9 months ended September
30 |
|
2024 |
2023 |
2024 |
2023 |
|
|
|
|
|
Cash inflow from operations |
11,407 |
16,963 |
38,930 |
17,629 |
Interest
received |
7 |
21 |
16 |
30 |
Finance
costs paid |
(781) |
(331) |
(2,064) |
(1,762) |
Tax
paid |
(6,042) |
(2,158) |
(8,318) |
(4,504) |
Net cash inflow from operating activities |
4,591 |
14,495 |
28,564 |
11,393 |
|
|
|
|
|
Cash flows used in investing activities |
|
|
|
|
Acquisition of property, plant and equipment |
(6,751) |
(9,573) |
(17,389) |
(20,175) |
Acquisition of exploration and evaluation assets |
(245) |
(597) |
(1,408) |
(880) |
Acquisition of put options |
– |
(1) |
(408) |
(812) |
Net cash used in investing activities |
(6,996) |
(10,171) |
(19,205) |
(21,867) |
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
Dividends
paid |
(3,430) |
(2,801) |
(9,062) |
(8,118) |
Payment
of lease liabilities |
(39) |
(36) |
(114) |
(108) |
Shares
issued – equity raise (net of transaction cost) |
– |
– |
– |
15,658 |
Proceeds
from long term loans |
1 |
– |
2,033 |
– |
Repayments of term loans |
(262) |
– |
(262) |
– |
Loan
notes - Motapa payment |
– |
(563) |
– |
(7,250) |
Loan
notes - solar bond issue receipts (net of transaction cost) |
– |
– |
1,939 |
7,000 |
Net cash (used in)/ from financing activities |
(3,730) |
(3,400) |
(5,466) |
7,182 |
|
|
|
|
|
Net (decrease) increase in cash and cash
equivalents |
(6,135) |
924 |
3,893 |
(3,292) |
Effect of
exchange rate fluctuations on cash and cash equivalents |
(134) |
(1,209) |
(496) |
(1,396) |
Net cash
and cash equivalents at beginning of the period |
(1,366) |
(2,907) |
(11,032) |
1,496 |
Net cash and cash equivalents at end of the
period |
(7,635) |
(3,192) |
(7,635) |
(3,192) |
1 Adjusted EPS
excludes net foreign exchange movements (including the deferred tax
effect and the non-controlling interest thereon) and deferred tax.
A reconciliation of IFRS EPS to Adjusted EPS is set out in section
10.3 of the MD&A. 2 Refer to technical report "NI 43-101
Technical Report on the Blanket Gold Mine, Zimbabwe" with effective
date December 31, 2023 prepared by Caledonia Mining Corporation Plc
and filed by the Company on SEDAR+ (www.sedarplus.ca) on May 15,
2024
Caledonia Mining (AMEX:CMCL)
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