Caledonia Mining Corporation Plc (NYSE AMERICAN: CMCL; AIM: CMCL)
("Caledonia" or the "Company") announces its operating and
financial results for the quarter and the nine months ended
September 30, 2021 (the "Quarter" and "Nine Months" respectively).
Further information on the financial and operating results
for the Quarter and Nine Months 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 have
been filed on SEDAR.
Financial Highlights for the Quarter
- Gross
revenues of $33.5 million, a 31.9 per cent increase on the $25.4
million achieved in the third quarter of 2020 ("Q3 2020").
- Gross
profit of $15.7 million, a 25.6 per cent increase on the $12.5
million in Q3 2020, due to higher production and lower cost per
ounce offset in the Quarter by a lower gold price.
-
EBITDA of $15.1 million, a 30 per cent increase on the $11.7
million in Q3 2020 at a margin of 45 per cent (Q3 2020: 46 per
cent).
- The
on-mine cost per ounce1 decreased 8% from $758 in Q3 2020 to $695
due to higher production which spread fixed costs over more
production ounces.
- The
all-in sustaining cost per ounce decreased 19% from $1,119 in Q3
2020 to $909. This reflects the decrease in on-mine cost per ounce
and reduced sustaining capex.
- Basic
IFRS earnings per share ("EPS") increased by 56 per cent from 36.6
cents in Q3 2020 to 57.1 cents.
-
Adjusted EPS increased by 102 per cent from 34.1 cents in Q3
2020 to 68.9 cents.
- Net
cash from operating activities of $7.1 million (Q3 2020: $5.3
million) due to higher operating profit offset by higher working
capital.
- Net
cash and cash equivalents of $13.0 million (Q3 2020: $21.6
million).
- In October 2021,
the Company declared and paid a quarterly dividend of 14 cents per
share. This was the seventh increase in the quarterly dividend
since October 2019 and more than double the 6.875 cents declared
only two years ago in October 2019
Operating
Highlights
- 18,965
ounces of gold produced in the Quarter (Q3 2020: 15,155 ounces)
which is a new quarterly production record for Blanket and reflects
the contribution of Central Shaft.
- 48,872
ounces produced in the Nine Months, a 14 per cent increase on the
42,887 ounces produced in the first nine months of 2020.
Outlook
- Production
guidance for the year to December 31, 2021 has been narrowed at the
top end of previous guidance at 65,000 to 67,000 ounces.
- Due to, inter
alia, historic delays in the completion of the Central Shaft
arising from COVID-19, the need to remediate the poor electricity
supply from the Zimbabwe Electricity Supply Authority, and an
upgrade to the workers’ village to accommodate a larger workforce,
capital expenditure at Blanket in 2022 is now expected to be
$27million.
- Caledonia has
completed the purchase of the mining claims at Maligreen in the
Zimbabwe midlands.
- Caledonia
continues to evaluate Connemara North, in respect of which it has
an option to purchase.
- The Company
will consider further investment opportunities in Zimbabwe and
elsewhere.
Steve Curtis, Chief Executive
Officer, commented:
“This has been another
excellent quarter: record quarterly production of almost 19,000
ounces signifies the contribution that Central Shaft is already
making. The commissioning and subsequent ramp-up of activity at
Central Shaft met our best expectations and we have therefore been
able to narrow our production guidance to the top end of our
previous range. We remain on track to hit our 80,000 ounce target
from 2022 onwards2.
“Revenue in the Quarter was 32 per cent higher
than in Q3 2020 due to a 42 per cent increase in the quantity of
gold produced and sold offset by a 7 per cent decrease in the
average realised gold price. Net cash generated by operations in
the Quarter was $7.1 million, compared to $5.3 million in Q3 2020.
The increase was due to higher gross profit (due to increased
production and lower costs per ounce), offset by increased working
capital.
“The completion of
Central Shaft and the resultant increase in production means that
Caledonia can execute other areas of its growth strategy, such as
the agreement to acquire Maligreen which was announced during the
quarter, which has an estimated inferred resource of 940,000 ounces
of gold in 15.6 million tonnes at a grade of 1.88 grammes per
tonne3. This transaction was completed after the end of the
Quarter.
“In October 2021, the Company declared and paid
an increased dividend of 14 cents per share. This was the seventh
increase in the quarterly dividend since October 2019 and an
increase of 104 per cent from 6.875 cents in October 2019. These
dividend increases reflect the strong financial and operating
performance of the business. The board will continue to review
Caledonia's future dividend distributions as appropriate.
“In October, the advance dividend loan account
due from the Gwanda Community Share Ownership Trust (“GCSOT”), a 10
per cent shareholder in Blanket, was repaid. Henceforth GCSOT will
receive its full entitlement to 10 per cent of dividends paid by
Blanket. Investment in our local communities and employees (who
also hold a 10 per cent shareholding in the mine through an
employee trust) is key to a successful business and I am therefore
delighted that the loan to the GCSOT is now fully repaid and that
the community will start to receive its full dividend amount.
“Caledonia’s immediate strategic focus following
the commissioning of the Central Shaft project earlier this year is
to increase production, reduce operating costs and increase the
flexibility to undertake further development and exploration,
thereby safeguarding and enhancing Blanket’s long-term future.”
For further information please contact:
Caledonia Mining Corporation PlcMark
LearmonthCamilla Horsfall |
Tel: +44 1534 679 802Tel: +44 7817 841793 |
|
|
WH IrelandAdrian
Hadden/ Andrew De Andrade |
Tel: +44 20 7220 1751 |
|
|
Blytheweigh Financial
PRTim Blythe/Megan Ray |
Tel: +44 207 138 3204 |
|
|
3PPBPatrick
ChidleyPaul Durham |
Tel: +1 917 991 7701Tel: +1 203
940 2538 |
|
|
Curate Public Relations
(Zimbabwe)Debra Tatenda |
Tel: +263 77802131 |
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 InformationInformation 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(in thousands of United States
Dollars, unless indicated otherwise) |
|
|
|
|
|
|
|
Unaudited |
|
|
|
|
|
|
For the |
|
Three months ended |
|
Nine months ended |
|
|
September 30, |
|
September 30, |
|
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
|
|
|
|
|
|
|
|
Revenue |
|
33,496 |
|
25,359 |
|
|
89,193 |
|
71,874 |
|
Less: Royalty |
|
(1,679 |
) |
(1,271 |
) |
|
(4,471 |
) |
(3,599 |
) |
Production costs |
|
(13,729 |
) |
(10,399 |
) |
|
(38,948 |
) |
(32,537 |
) |
Depreciation |
|
(2,351 |
) |
(1,143 |
) |
|
(5,743 |
) |
(3,457 |
) |
Gross profit |
|
15,737 |
|
12,546 |
|
|
40,031 |
|
32,281 |
|
Other income |
|
12 |
|
27 |
|
|
42 |
|
4,736 |
|
Other expenses |
|
(1,254 |
) |
(305 |
) |
|
(5,395 |
) |
(1,827 |
) |
Administrative expenses |
|
(1,906 |
) |
(2,539 |
) |
|
(5,261 |
) |
(5,361 |
) |
Cash-settled share-based expense |
|
(243 |
) |
(231 |
) |
|
(426 |
) |
(1,177 |
) |
Net foreign exchange gain |
|
413 |
|
985 |
|
|
341 |
|
4,694 |
|
Fair value gains (losses) on derivative assets |
|
– |
|
27 |
|
|
(107 |
) |
(121 |
) |
Operating profit |
|
12,759 |
|
10,510 |
|
|
29,225 |
|
33,225 |
|
Finance income |
|
4 |
|
4 |
|
|
11 |
|
36 |
|
Finance cost |
|
(17 |
) |
(91 |
) |
|
(365 |
) |
(390 |
) |
Profit before tax |
|
12,746 |
|
10,423 |
|
|
28,871 |
|
32,871 |
|
Tax expense |
|
(4,423 |
) |
(4,993 |
) |
|
(11,318 |
) |
(11,410 |
) |
Profit for the period |
|
8,323 |
|
5,430 |
|
|
17,553 |
|
21,461 |
|
|
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
|
Items that are or may be reclassified to profit or
loss |
|
|
|
|
|
|
Exchange differences on
translation of foreign operations |
|
(330 |
) |
(88 |
) |
|
(149 |
) |
(1,146 |
) |
Total comprehensive income for the period |
|
7,993 |
|
5,342 |
|
|
17,404 |
|
20,315 |
|
|
|
|
|
|
|
|
Profit attributable to: |
|
|
|
|
|
|
Owners of the Company |
|
6,939 |
|
4,433 |
|
|
14,183 |
|
17,807 |
|
Non-controlling interests |
|
1,384 |
|
997 |
|
|
3,370 |
|
3,654 |
|
Profit for the period |
|
8,323 |
|
5,430 |
|
|
17,553 |
|
21,461 |
|
|
|
|
|
|
|
|
Total comprehensive income attributable to: |
|
|
|
|
|
|
Owners of the Company |
|
6,609 |
|
4,345 |
|
|
14,034 |
|
16,661 |
|
Non-controlling interests |
|
1,384 |
|
997 |
|
|
3,370 |
|
3,654 |
|
Total comprehensive income for the period |
|
7,993 |
|
5,342 |
|
|
17,404 |
|
20,315 |
|
|
|
|
|
|
|
|
Earnings per share |
|
|
|
|
|
|
Basic earnings per share ($) |
|
0.57 |
|
0.37 |
|
|
1.15 |
|
1.50 |
|
Diluted earnings per share ($) |
|
0.57 |
|
0.37 |
|
|
1.15 |
|
1.50 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed
consolidated statements of financial position(Unaudited)
(in thousands of United States Dollars, unless indicated
otherwise) |
As at |
|
September 30, |
|
December 31, |
|
|
|
2021 |
|
2020 |
|
|
|
|
|
Assets |
|
|
|
Property, plant
and equipment |
|
142,965 |
|
126,479 |
|
Exploration and
evaluation asset |
|
4,354 |
|
6,768 |
|
Deferred tax
asset |
|
102 |
|
87 |
|
Total
non-current assets |
|
147,421 |
|
133,334 |
|
|
|
|
|
Inventories |
|
18,134 |
|
16,798 |
|
Prepayments |
|
7,110 |
|
1,974 |
|
Trade and other
receivables |
|
11,828 |
|
4,962 |
|
Income tax
receivable |
|
27 |
|
76 |
|
Derivative
financial assets |
|
– |
|
1,184 |
|
Cash and cash
equivalents |
|
13,213 |
|
19,092 |
|
Assets held for
sale |
|
– |
|
500 |
|
Total
current assets |
|
50,312 |
|
44,586 |
|
Total
assets |
|
197,733 |
|
177,920 |
|
|
|
|
|
Equity and
liabilities |
|
|
|
Share capital |
|
74,696 |
|
74,696 |
|
Reserves |
|
138,161 |
|
138,310 |
|
Retained loss |
|
(61,673 |
) |
(71,487 |
) |
Equity
attributable to shareholders |
|
151,184 |
|
141,519 |
|
Non-controlling
interests |
|
18,649 |
|
16,524 |
|
Total
equity |
|
169,833 |
|
158,043 |
|
|
|
|
|
Liabilities |
|
|
|
Provisions |
|
3,427 |
|
3,567 |
|
Deferred tax
liabilities |
|
8,699 |
|
4,234 |
|
Cash-settled
share-based payment - long term portion |
|
931 |
|
1,934 |
|
Lease liabilities
- long term portion |
|
260 |
|
178 |
|
Total
non-current liabilities |
|
13,317 |
|
9,913 |
|
|
|
|
|
Loans and
borrowings |
|
70 |
|
408 |
|
Cash-settled
share-based payment - short term portion |
|
1,768 |
|
336 |
|
Lease liabilities
- short term portion |
|
103 |
|
61 |
|
Income taxes
payable |
|
1,919 |
|
495 |
|
Trade and other
payables |
|
10,520 |
|
8,664 |
|
Overdraft |
|
203 |
|
– |
|
Total
current liabilities |
|
14,583 |
|
9,964 |
|
Total
liabilities |
|
27,900 |
|
19,877 |
|
Total
equity and liabilities |
|
197,733 |
|
177,920 |
|
|
|
Condensed consolidated statements of cash flows
(in thousands of United States Dollars, unless indicated
otherwise) |
|
Unaudited |
|
For the |
|
Three months ended |
|
Nine months ended |
|
|
|
September 30, |
|
September 30, |
|
|
|
2021 |
|
2020 |
|
|
2021 |
|
2020 |
|
|
|
|
|
|
|
|
|
Cash generated from
operations |
|
9,338 |
|
7,393 |
|
|
26,875 |
|
23,764 |
|
Interest received |
|
– |
|
4 |
|
|
7 |
|
36 |
|
Interest paid |
|
(50 |
) |
(78 |
) |
|
(304 |
) |
(373 |
) |
Tax paid |
|
(2,176 |
) |
(2,048 |
) |
|
(4,774 |
) |
(4,082 |
) |
Net cash from
operating activities |
|
7,112 |
|
5,271 |
|
|
21,804 |
|
19,345 |
|
|
|
|
|
|
|
|
|
|
Cash flows used in
investing activities |
|
|
|
|
|
|
|
|
Acquisition of property, plant
and equipment |
|
(8,564 |
) |
(8,007 |
) |
|
(22,332 |
) |
(15,928 |
) |
Acquisition and expenditure on
exploration and evaluation assets |
|
(449 |
) |
– |
|
|
(1,423 |
) |
– |
|
Proceeds on disposal of assets
held for sale |
|
500 |
|
– |
|
|
500 |
|
– |
|
Realisation (purchase) of
derivative financial asset |
|
– |
|
– |
|
|
1,082 |
|
(1,058 |
) |
Proceeds from disposal of
subsidiary |
|
– |
|
– |
|
|
340 |
|
900 |
|
Net cash used in
investing activities |
|
(8,513 |
) |
(8,007 |
) |
|
(21,833 |
) |
(16,086 |
) |
|
|
|
|
|
|
|
|
Cash flows from
financing activities |
|
|
|
|
|
|
|
Dividends paid |
|
(2,108 |
) |
(1,129 |
) |
|
(5,614 |
) |
(3,110 |
) |
Term loan repayments |
|
(100 |
) |
– |
|
|
(306 |
) |
– |
|
Payment of lease
liabilities |
|
(31 |
) |
(30 |
) |
|
(96 |
) |
(87 |
) |
Shares issued - equity raise
(net of transaction cost) |
|
– |
|
12,538 |
|
|
– |
|
12,538 |
|
Share options exercised |
|
– |
|
– |
|
|
– |
|
30 |
|
Net cash (used in)
from financing activities |
|
(2,239 |
) |
11,379 |
|
|
(6,016 |
) |
9,371 |
|
|
|
|
|
|
|
|
|
|
Net (decrease) /
increase in cash and cash equivalents |
|
(3,640 |
) |
8,643 |
|
|
(6,045 |
) |
12,630 |
|
Effect of exchange rate
fluctuations on cash held |
|
(19 |
) |
1,280 |
|
|
(37 |
) |
39 |
|
Net cash and cash equivalents
at the beginning of the period |
|
16,669 |
|
11,639 |
|
|
19,092 |
|
8,893 |
|
Net cash and cash
equivalents at the end of the period |
|
13,010 |
|
21,562 |
|
|
13,010 |
|
21,562 |
|
|
|
|
|
|
|
|
|
|
______________________________________1 Non-IFRS measures such as
“on-mine cost per ounce”, “all-in sustaining cost per ounce” and
“adjusted EPS” are used throughout this announcement. Refer to
section 10 of the MD&A for a discussion of non-IFRS measures.2
Refer to the technical report entitled “Caledonia Mining
Corporation Plc NI 43-101 Technical Report on the Blanket Gold
Mine, Zimbabwe” dated May 17, 2021 prepared by Minxcon (Pty) Ltd
and filed by the Company on SEDAR (www.sedar.com) on May 26, 2021.
Mr Dana Roets (B Eng (Min.), MBA, Pr.Eng., FSAIMM, AMMSA), Chief
Operating Officer, is the Company's qualified person as defined by
Canada's National Instrument 43-101 and has approved any scientific
or technical information contained in this news release.3 Refer to
technical report entitled “Caledonia Mining Corporation Plc NI
43-101 Mineral Resource Report on the Maligreen Gold Project,
Zimbabwe” by Minxcon (Pty) Ltd dated November 2, 2021 and filed on
SEDAR on November 5, 2021.
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