VANCOUVER, Nov. 6, 2018 /PRNewswire/ - B2Gold Corp. (TSX:
BTO, NYSE AMERICAN: BTG, NSX: B2G) ("B2Gold" or the "Company") is
pleased to announce its operational and financial results for the
three and nine months ended September 30,
2018. The Company previously released its gold production
and gold revenue results for the third quarter and first nine
months of 2018 (see news release dated 10/11/2018). All
dollar figures are in United
States dollars unless otherwise indicated.
2018 Third Quarter Highlights
- Record quarterly consolidated gold production of 242,040
ounces, a significant increase of 78% (106,412 ounces) over the
same period last year and in-line with budget, due to the continued
strong performances of the Fekola Mine in Mali, Masbate Mine in the Philippines and the Otjikoto Mine in
Namibia
- Consolidated gold revenue of $324
million, a significant increase of 110% ($170 million) over the same period last year
- Consolidated cash operating costs (see "Non-IFRS Measures") of
$504 per ounce, in-line with budget
and $59 per ounce (10%) lower than
the prior-year quarter
- Consolidated all-in sustaining costs ("AISC") (see "Non-IFRS
Measures") of $749 per ounce, in-line
with budget and significantly lower by $172 per ounce (19%) than the prior-year
quarter
- Consolidated cash flows from operating activities of
$143 million ($0.14 per share), significantly increasing by
$101 million (240%) from $42 million ($0.04
per share) in the prior-year quarter
- Net income of $16 million
($0.01 per share) and adjusted net
income (see "Non-IFRS Measures") of $45
million ($0.05 per
share)
- Fekola Mine continued to operate above plan, producing 107,002
ounces of gold in the quarter
- Masbate Mine's guidance revised favourably; for full-year 2018,
the Masbate Mine is now forecast to produce between 200,000 to
210,000 ounces of gold (original guidance was between 180,000 to
190,000 ounces)
- Subsequent to the third quarter, the Company repaid in full its
$259 million aggregate principal
amount of convertible senior subordinated notes which matured on
October 1, 2018
- In October 2018, subsequent to
the third quarter, the Company was granted the mine permit for the
Limon Central Pit in Nicaragua and
announced positive results from the Expansion Study at El Limon
Mine and that a renewed collective agreement had been signed with
El Limon labour unions
- On October 25, 2018, subsequent
to the third quarter, the Company announced a substantial increase
in the gold mineral resource estimate for the Fekola Mine and
positive results from the ongoing Fekola Mill Expansion Study
2018 First Nine Months Highlights
- Record consolidated year-to-date gold production of 721,817
ounces, 5% (31,888 ounces) above original budget and 85% (332,005
ounces) higher than the first nine months of 2017
- Record consolidated year-to-date gold revenue of $953 million on record year-to-date sales of
749,102 ounces at an average price of $1,272 per ounce
- Consolidated cash operating costs of $486 per ounce, well below budget by $51 per ounce (9%) and $99 per ounce (17%) lower than the first nine
months of 2017
- Consolidated AISC of $740 per
ounce, well below budget by $97 per
ounce (12%) and $187 per ounce (20%)
lower than the first nine months of 2017
- Consolidated cash flows from operating activities of
$377 million ($0.38 per share), significantly increasing by
$248 million (192%) from $129 million ($0.13
per share) in the first nine months of 2017
- Net income of $95 million
($0.09 per share) and adjusted net
income of $149 million ($0.15 per share)
- B2Gold is well on target to achieve transformational growth in
2018 and expects to meet the upper end of its revised 2018 gold
production guidance range of between 920,000 and 960,000 ounces
(original guidance was between 910,000 and 950,000 ounces) and also
expects to meet the lower end of its 2018 cost guidance ranges for
cash operating costs of between $505
and $550 per ounce and AISC of
between $780 and $830 per ounce
2018 Third Quarter and First
Nine Months Operational Results
With the new large, low-cost Fekola Mine in Mali in its first full-year of production
(after achieving commercial production on November 30, 2017), consolidated gold production
in the third quarter of 2018 was a quarterly record of 242,040
ounces, a significant increase of 78% (106,412 ounces) over the
same period last year and in-line with budget. In its third
full-quarter of commercial operations, the new Fekola Mine
continued to operate above plan, producing 107,002 ounces of gold,
2% (1,583 ounces) above original budget. In addition, the Masbate
Mine in the Philippines produced
57,542 ounces of gold, the second highest quarterly production ever
for the mine, which was 29% (12,845 ounces) above budget and 24%
(10,985 ounces) higher than the third quarter of 2017. Based on
Masbate's strong year-to-date performance, Masbate's 2018 guidance
was favourably revised in the third quarter. For full-year 2018,
the Masbate Mine is now forecast to produce between 200,000 to
210,000 ounces of gold (original guidance was between 180,000 to
190,000 ounces) at cash operating costs of between $545 to $595 per
ounce (original guidance was between $675 to $720 per
ounce) and AISC of between $780 to
$830 per ounce (original guidance was
between $875 to $925 per ounce). The Otjikoto Mine in
Namibia also had another solid
quarter and exceeded its targeted production level. The strong
operational performances by the Fekola, Masbate and Otjikoto mines
offset the production shortfalls relating to the Company's La
Libertad and El Limon mines in Nicaragua whose operations continued to be
affected by the current national political unrest in that country.
In light of La Libertad's underperformance, for the full-year 2018,
La Libertad Mine is now forecast to produce between 90,000 to
95,000 ounces of gold (original guidance was between 115,000 to
120,000 ounces) at cash operating costs of between $855 to $905 per
ounce (original guidance was between $745 to $790 per
ounce) and AISC of between $1,160 to
$1,210 per ounce (original guidance
was between $1,050 to $1,100 per ounce).
Consolidated cash operating costs in the quarter were
$504 per ounce, in-line with budget
and $59 per ounce (10%) lower than
the prior-year quarter. Consolidated AISC were $749 per ounce, also in-line with budget and
significantly lower by $172 per ounce
(19%) than the prior-year quarter, mainly attributable to the new
low-cost production from the Fekola Mine.
Consolidated gold production in the first nine months of 2018
was a year-to-date record of 721,817 ounces, 5% (31,888 ounces)
above original budget and 85% (332,005 ounces) higher than the
first nine months of 2017.
Year-to-date, consolidated cash operating costs were
$486 per ounce, well below budget by
$51 per ounce (9%) and $99 per ounce (17%) lower than the comparable
period in 2017. Consolidated AISC were $740 per ounce, well below budget by $97 per ounce (12%) and $187 per ounce (20%) lower than the first nine
months of 2017.
As outlined above, B2Gold remains well on target to achieve
transformational growth in 2018. For full-year 2018, with the
planned first full-year of production from the Fekola Mine,
consolidated gold production is forecast to be at the upper end of
the Company's guidance range of between 920,000 and 960,000 ounces.
This represents an increase in annual consolidated gold production
of approximately 300,000 ounces in 2018 from 2017. The Company also
expects to meet the lower end of its 2018 cost guidance ranges for
cash operating costs of between $505
and $550 per ounce and AISC of
between $780 and $830 per ounce.
With the Fekola Mine in production, the resulting increase in
gold production levels combined with low costs have dramatically
increased B2Gold's production, revenues, cash from operations and
free cash flows with ongoing benefits expected to continue for many
years, based on current assumptions. If a gold price assumption of
$1,200 per ounce is used for the
balance of 2018, the Company expects to generate cash flow from
operations of approximately $450
million for the year.
2018 Third Quarter and First
Nine Months Financial Results
Consolidated gold revenue in the third quarter of 2018 was
$324 million on record quarterly
sales of 268,527 ounces at an average price of $1,206 per ounce compared to $154 million on sales of 121,597 ounces at an
average price of $1,267 per ounce in
the third quarter of 2017. This significant increase in revenue of
110% ($170 million) was mainly
attributable to the higher gold production and timing of gold
sales, relating to the sale of opening gold bullion and in-circuit
inventories at the beginning of the quarter.
Consolidated cash flows from operating activities in the third
quarter of 2018 increased by $101
million (240%) to $143 million
($0.14 per share) from $42 million ($0.04
per share) in the prior-year quarter, reflecting the strong
increase in revenue (as discussed above) combined with lower per
ounce production costs.
For the third quarter of 2018, the Company generated net income
of $16 million ($0.01 per share) compared to a net income of
$12 million ($0.01 per share) in the third quarter of 2017.
Adjusted net income for the third quarter of 2018 was $45 million ($0.05
per share) compared to adjusted net income of $14 million ($0.01
per share) in the third quarter of 2017.
For the first nine months of 2018, consolidated gold revenue was
a year-to-date record of $953 million
on record year-to-date sales of 749,102 ounces at an average price
of $1,272 per ounce compared to
$465 million on sales of 373,271
ounces at an average price of $1,245
per ounce in the first nine months of 2017. This significant
increase in revenue of 105% ($488
million) was mainly attributable to the higher gold
production and timing of gold sales, relating to the sale of
opening gold bullion and in-circuit inventories at the beginning of
the year.
Year-to-date, consolidated cash flows from operating activities
significantly increased by $248
million (192%) to $377 million
($0.38 per share) from $129 million ($0.13
per share) in the first nine months of 2017.
For the first nine months of 2018, the Company generated net
income of $95 million ($0.09 per share) compared to a net income of
$27 million ($0.03 per share) in the first nine months of
2017. Adjusted net income for the nine months ended September 30, 2018 was $149 million ($0.15
per share) compared to adjusted net income of $46 million ($0.05
per share) in the comparable period of 2017.
Liquidity and Capital Resources
At September 30, 2018, the Company
had cash and cash equivalents of $355
million compared to cash and cash equivalents of
$147 million at December 31, 2017. Working capital at
September 30, 2018 was $132 million compared to a working capital
deficit of $99 million at
December 31, 2017. In anticipation of
repayment of the Company's convertible senior subordinated notes
(the "Notes") on October 1, 2018, the
Company made a drawdown of $200
million on its revolving credit facility ("RCF") which was
included in working capital at September 30,
2018. Subsequent to September 30,
2018, the Company repaid in full its $259 million aggregate principal amount of Notes
(plus accrued interest) which matured on October 1, 2018. The repayment of all outstanding
principal and accrued interest under the Notes amounted to
approximately $263 million. The
working capital deficit at December 31,
2017 resulted from the classification of the Company's
convertible senior subordinated notes to current liabilities since
they were due on October 1, 2018.
Repayment of the Notes reflects the ongoing second phase of
B2Gold's strategy to fund construction of the Fekola Mine in
Mali without using equity
financing. The Company funded construction of Fekola using a
combination of operating cashflows from existing mines, debt
facilities and prepaid gold contract sales. Following the
successful achievement of commercial production at the Fekola Mine
in late 2017, the Company has been reducing its total debt
outstanding throughout the course of 2018. The Company started 2018
with total debt outstanding of approximately $700 million (comprised of the drawn portion of
the RCF, convertible notes and equipment loans and leases). The
Company expects to have reduced its total debt outstanding to
approximately $500 million by
December 31, 2018, a reduction of
$200 million for the year.
At September 30, 2018, the Company
had drawn $400 million under the
$500 million RCF, leaving an undrawn
and available balance under the existing facility of $100 million.
Operations
Mine-by-mine gold production in the third quarter and first nine
months of 2018 was as follows:
Mine
|
Q3
2018 Gold
Production (ounces)
(1)
|
YTD
2018 Gold
Production (ounces)
(1)
|
Revised Annual Guidance Gold Production
(ounces) (1)
|
Original Annual Guidance Gold Production
(ounces) (1)
|
Fekola
|
107,002
|
333,788
|
420,000 -
430,000
|
400,000 -
410,000
|
Masbate
|
57,542
|
164,943
|
200,000 -
210,000
|
180,000 -
190,000
|
Otjikoto
|
42,403
|
122,580
|
160,000 -
170,000
|
160,000 -
170,000
|
La Libertad
|
21,995
|
62,770
|
90,000 -
95,000
|
115,000 -
120,000
|
El Limon
|
13,098
|
37,736
|
50,000 -
55,000
|
55,000 -
60,000
|
|
|
|
|
|
B2Gold
Consolidated
|
242,040
|
721,817
|
920,000 -
960,000
|
910,000 -
950,000
|
(1)
|
B2Gold's Q3 2018 and
year-to-date 2018 production results and its revised 2018 annual
production guidance reflect the total production at the mines
B2Gold operates.
|
Mine-by-mine cash operating costs and AISC per ounce in the
third quarter and first nine months of 2018 were as
follows:
Mine
|
Q3
2018 Cash Operating
Costs ($ per ounce)
(2)
|
YTD
2018 Cash
Operating Costs ($ per ounce) (2)
|
Revised Annual Guidance Cash Operating
Costs ($ per ounce)
(2)
|
Original Annual Guidance Cash Operating
Costs ($ per ounce)
(2)
|
Fekola
|
$383
|
$321
|
$345 - $390
|
$345 - $390
|
Masbate
|
$528
|
$534
|
$545 - $595
|
$675 - $720
|
Otjikoto
|
$470
|
$514
|
$480 - $525
|
$480 - $525
|
La Libertad
|
$871
|
$919
|
$855 - $905
|
$745 - $790
|
El Limon
|
$875
|
$928
|
$850 - $900
|
$700 - $750
|
|
|
|
|
|
B2Gold
Consolidated
|
$504
|
$486
|
$505 -
$550
|
$505 -
$550
|
(2)
|
B2Gold's Q3 2018 and
year-to-date 2018 cash operating costs and its revised 2018 annual
cost guidance for cash operating costs are based on the total
production at the mines B2Gold operates.
|
Mine
|
Q3
2018 AISC ($
per ounce) (3)
|
YTD
2018 AISC ($
per ounce) (3)
|
Revised Annual Guidance AISC ($
per ounce) (3)
|
Original Annual Guidance AISC ($
per ounce) (3)
|
Fekola
|
$607
|
$511
|
$575 - $625
|
$575 - $625
|
Masbate
|
$675
|
$717
|
$780 - $830
|
$875 - $925
|
Otjikoto
|
$662
|
$747
|
$700 - $750
|
$700 - $750
|
La Libertad
|
$1,036
|
$1,183
|
$1,160 -
$1,210
|
$1,050 -
$1,100
|
El Limon
|
$1,315
|
$1,500
|
$1,385 -
$1,435
|
$1,135 -
$1,185
|
|
|
|
|
|
B2Gold
Consolidated
|
$749
|
$740
|
$780 -
$830
|
$780 -
$830
|
(3)
|
B2Gold's Q3 2018 and
year-to-date 2018 AISC and its revised 2018 annual cost guidance
for AISC are based on the total production at the mines B2Gold
operates.
|
Fekola Gold Mine - Mali
The Fekola Mine in Mali
continued to outperform budget in its third full-quarter of
commercial operations (after achieving commercial production on
November 30, 2017), running above
plan on mill throughput and recoveries. This resulted in the Fekola
Mine producing 107,002 ounces of gold in the third quarter of 2018,
2% (1,583 ounces) above original budget. Mill throughput and
recoveries were 1,403,992 tonnes (compared to budget of 1,278,473
tonnes) and 94.7% (compared to budget of 92.7%), respectively. It
is expected that the recoveries will continue to be within the
range of design (92.7%) and observed (95%) recoveries. The
average grade processed was 2.50 grams per tonne ("g/t"), below
budget of 2.77 g/t as the additional tonnage processed consisted of
medium and low-grade ore. The block model continues to perform as
expected compared to actual mined grade and tonnage.
Fekola's third quarter cash operating costs were $383 per ounce, above budget by $34 per ounce (10%) but remained well below
budget year-to-date. This third quarter variance was mainly
attributable to higher fuel costs and slightly higher than budgeted
processing throughput. Diesel prices were 18% higher than budget
and fuel oil prices were 13% above budget, increasing cash
operating costs by approximately $15
per ounce. On the processing side, the Fekola Mine is now running
consistently at an annualized throughput of over 5.5 million tonnes
per annum ("Mtpa"), 10% higher than name plate and budget. A
decision was made to feed this additional throughput using medium
and low-grade ore stockpiles which had two benefits. Firstly, it
allowed Fekola to increase its overall production levels (without
utilizing high-grade stockpiles which are scheduled for processing
in 2019). Secondly, it allowed the Company to complete a limited
medium and low-grade ore campaign to confirm that the Fekola mill
recoveries continue to remain above design predictions over a broad
range of ore types. Overall, the additional processed tonnage
during the third quarter increased cash operating costs by
approximately $10 per ounce. Slightly
higher than budgeted processing costs per ounce were partially
offset by lower than budgeted mining costs, resulting in part from
mining in a zone consisting of near surface weathered rock in phase
4 of the Fekola Pit, therefore lowering the operational and
maintenance costs of the mining equipment. Fekola's AISC for the
quarter were $607 per ounce, above
budget by $42 per ounce (7%), mainly
reflecting the higher than budgeted cash operating costs, but also
remained well below budget year-to-date. Included in Fekola's AISC
were the Company's gains on fuel derivatives of $9 per ounce which partially offset the higher
than budgeted cash operating costs.
Year-to-date, the Fekola Mine produced 333,788 ounces of gold,
above original budget by 8% (24,036 ounces). To-date (since the
commencement of ore processing began in September 2017 to September 30, 2018), gold production from the
Fekola Mine totaled 445,238 ounces (including 79,243 ounces of
pre-commercial production).
Fekola's per ounce cash costs remained well below budget in the
first nine months of the year with cash operating costs of
$321 per ounce, $38 per ounce (11%) below budget, and AISC of
$511 per ounce, $79 per ounce (13%) below budget. Cost savings
were largely driven by lower than budgeted mining costs and higher
than budgeted gold production, partially offset by higher fuel
costs.
Capital expenditures in the third quarter of 2018 totaled
$17 million, mainly consisting of
$5 million for pre-stripping,
$5 million for mobile equipment
purchases and rebuilds and $3 million
for Fadougou Village relocation costs. Year-to-date, capital
expenditures totaled $54 million,
mainly consisting of $14 million for
pre-stripping, $12 million in
construction carryover for the completion of the powerhouse and
other projects, $8 million for
Fadougou Village relocation costs, $6
million for the construction of stages 2 and 3 of the
tailings storage facility and $8
million for mobile equipment purchases and rebuilds.
For full-year 2018, Fekola's gold production continues to
outperform and is on track to be at or above its revised production
guidance range of between 420,000 to 430,000 ounces of gold
(original guidance was 400,000 to 410,000 ounces). Fekola's cash
operating costs are expected to be at the low end of its guidance
range of between $345 and
$390 per ounce and AISC are expected
to be at or below the low-end of its guidance range of between
$575 and $625 per ounce.
On August 8, 2018, the Company was
informed that the Malian Council of Ministers approved the
participation of the State in Fekola SA for a total of 20% (being
the 10% free carried interest plus the additional 10% interest),
through an ordinance and a decree of the Council of Ministers,
signed by the President. Now that the State of Mali's interest in Fekola SA has been
formally authorized by the Malian authorities, the Company has
transferred ownership of 20% of Fekola SA to the State of Mali.
Masbate Gold Mine - Philippines
The Masbate Mine in the
Philippines also continued its very strong operational
performance through the third quarter of 2018, producing 57,542
ounces of gold (the second highest quarterly production ever for
the mine), 29% (12,845 ounces) above budget and 24% (10,985 ounces)
higher than the third quarter of 2017. Gold production was
significantly higher than forecast as mill throughput, recoveries
and grade all exceeded budget. This resulted mainly from higher
than expected oxide ore tonnage and grade from the Colorado Pit.
Oxide ore represented 49% of the processed tonnage for the quarter
versus budget of 29%. The Colorado Pit was completely mined out on
August 19 (2 months earlier than
budgeted, as mining from the Colorado Pit had been accelerated to
complete mining prior to the rainy season). However, Masbate
maintains an ore feed stockpile from the Colorado Pit that will be
used to blend with the material from the Main Vein and Montana
South Pits through the end of 2018. The Masbate Mine also continued
its outstanding safety performance, achieving almost three years
(1,083 days) without a Lost-Time-Injury by quarter-end.
For the third quarter 2018, mill throughput and recoveries were
1,762,124 tonnes (compared to budget of 1,684,233 tonnes and
1,704,723 tonnes in the third quarter of 2017) and 73.0% (compared
to budget of 64.8% and 77.4% in the third quarter of 2017),
respectively. The average grade processed was 1.39 g/t compared to
budget of 1.28 g/t and 1.10 g/t in the third quarter of 2017.
Masbate's third quarter cash operating costs were $528 per ounce, significantly below budget by
$179 per ounce (25%) and $13 per ounce (2%) lower than the prior-year
quarter. Cash operating costs were below budget mainly due to the
higher than expected production. Masbate's AISC for the quarter
were $675 per ounce, significantly
below budget by $232 per ounce (26%)
and were also $42 per ounce (6%)
lower compared to the third quarter of 2017.
Year-to-date, gold production at the Masbate Mine was 164,943
ounces of gold, significantly above budget by 22% (29,639 ounces)
and 11% (15,894 ounces) higher than the first nine months of
2017.
Masbate's cash costs remained significantly below budget in the
first nine months of the year with cash operating costs of
$534 per ounce (year-to-date 2017 -
$527 per ounce), $176 per ounce (25%) below budget, and AISC of
$717 per ounce (year-to-date 2017 -
$800 per ounce), $213 per ounce (23%) below
budget.
Capital expenditures in the third quarter of 2018 totaled
$12 million, mainly including Masbate
processing plant upgrade costs of $6
million, mobile equipment purchases and rebuilds of
$1 million, and pre-stripping costs
of $1 million. For the first nine
months of 2018, capital expenditures totaled $33 million, mainly including Masbate processing
plant upgrade costs of $13 million,
mobile equipment acquisition costs and rebuilds of $5 million, pre-stripping costs of $4 million and $2
million for the tailings storage facility.
Based on Masbate's strong year-to-date performance, Masbate's
2018 guidance was favourably revised in the third quarter. For
full-year 2018, the Masbate Mine is now forecast to produce between
200,000 to 210,000 ounces of gold (original guidance was between
180,000 to 190,000 ounces) at cash operating costs of between
$545 to $595 per ounce (original guidance was between
$675 to $720 per ounce) and AISC of between $780 to $830 per
ounce (original guidance was between $875 to $925 per
ounce).
Otjikoto Gold Mine - Namibia
The Otjikoto Mine in Namibia
also delivered another quarter of solid production, producing
42,403 ounces of gold in the third quarter of 2018. This exceeded
budget by 4% (1,568 ounces), mainly due to higher-than-expected
mill throughput (870,125 tonnes compared to budget of 831,781
tonnes and 873,516 tonnes in the third quarter of 2017). Mill
recoveries also remained high and averaged 98.7%, exceeding both
budget of 98.0% and 98.5% in the third quarter of 2017. Compared to
the prior-year quarter, gold production was lower by 23% (12,748
ounces), as planned, due to a negligible amount of Wolfshag ore
being mined in 2018 while Phase 2 of the Wolfshag Pit is being
developed. Higher grade ore production is planned to resume from
the Wolfshag Pit in late 2019. As a result, the average grade
processed in the quarter was 1.54 g/t, compared to budget of 1.52
g/t and 1.99 g/t in the third quarter of 2017.
For third quarter 2018, Otjikoto's cash operating costs were
$470 per ounce (Q3 2017 -
$447 per ounce), $14 per ounce (3%) below budget, mainly the
result of higher than budgeted production. Otjikoto's AISC were
$662 per ounce, well below budget by
$53 per ounce (7%) and $147 per ounce (18%) lower than the prior-year
quarter. Otjikoto's AISC were below budget mainly due to higher
than budgeted production and lower general and administrative costs
and were lower than the prior-year quarter due to lower capital
expenditures for mobile equipment purchases.
Year-to-date, gold production at the Otjikoto Mine was 122,580
ounces of gold (year-to-date 2017 – 139,088 ounces), above budget
by 3% (4,027 ounces).
For the first nine months of 2018, Otjikoto's cash operating
costs were $514 per ounce
(year-to-date 2017 - $459 per ounce),
$19 per ounce (4%) below budget and
AISC were $747 per ounce
(year-to-date 2017 - $756 per ounce),
$15 per ounce (2%) below budget.
Capital expenditures in the third quarter of 2018 totaled
$12 million, mainly consisting of
$6 million for pre-stripping,
$3 million for new equipment and
$1 million in mobile equipment
rebuilds. Capital expenditures for the nine months ended
September 30, 2018 totaled
$41 million, mainly consisting of
$21 million for pre-stripping,
$10 million in mobile equipment
rebuilds and $4 million for the new
solar power plant.
For full-year 2018, the Otjikoto Mine is expected to produce
between 160,000 and 170,000 ounces of gold, primarily from the
Otjikoto Pit, at cash operating costs of between $480 and $525 per
ounce and AISC of between $700 and
$750 per ounce.
La Libertad Gold Mine -
Nicaragua
In the third quarter of 2018, La Libertad Mine in Nicaragua produced 21,995 ounces of gold, 39%
(14,207 ounces) below original budget. As a result of the onset of
national political unrest in Nicaragua, development of the Jabali Antenna
Underground project was temporarily suspended, resulting in
flooding of the underground workings. The Underground mine
dewatering was completed in mid-August and ramp development has
recommenced. Production from the underground operation is now
anticipated to commence by late-fourth quarter 2018. In addition,
the mine permit for the new Jabali Antenna Pit continues to be
delayed although progress has been made. The Company now
anticipates receiving the permit in time to start production from
the pit in the third quarter of 2019. Despite the impacts of the
political unrest, the Company continues to receive mining permits.
Mine permits are now in place for all other open pit and
underground operations. The Company received the San Juan mining permit in September 2017 and the San Diego mining permit in February 2018. As a result, mining has now
commenced in both pits. The planned mill feed for the quarter of
higher grade open-pit and underground ore was replaced with
lower-grade spent ore. The resulting head grade for the quarter was
1.29 g/t versus a budget of 2.07 g/t. The mill continued to operate
well with processing throughput at 559,616 tonnes (versus budget of
581,075 tonnes) and recovery at 95.5% (versus budget of 94.0%).
La Libertad Mine's third quarter cash operating costs were
$871 per ounce and AISC were
$1,036 per ounce, both significantly
above budget, reflecting the impact of the lower than budgeted
production.
Year-to-date, La Libertad Mine produced 62,770 ounces of gold,
24% (19,632 ounces) below original budget. Prior to the recent
disruption, gold production and overall operations were improving
at La Libertad, as expected, and generally on budget through the
end of May 2018.
For the first nine months of 2018, La Libertad's cash operating
costs were $919 per ounce,
$95 per ounce (12%) above budget, and
AISC were $1,183 per ounce,
$30 per ounce (2%) below budget. The
lower than budgeted AISC mainly resulted from lower than budgeted
pre-stripping costs for the San Juan Pit and capital costs for
Jabali Antenna.
Total capital expenditures in the third quarter of 2018 were
$3 million, mainly consisting of
underground development costs of $1
million and mobile equipment costs of $1 million. For the nine months ended
September 30, 2018, capital
expenditures totaled $13 million,
mainly consisting of $5 million of
pre-stripping and $5 million for
underground development.
In light of the underperformance discussed above, for the
full-year 2018, La Libertad Mine is now forecast to produce between
90,000 to 95,000 ounces of gold (original guidance was between
115,000 to 120,000 ounces) at cash operating costs of between
$855 to $905 per ounce (original guidance was between
$745 to $790 per ounce) and AISC of between $1,160 to $1,210
per ounce (original guidance was between $1,050 to $1,100
per ounce).
El Limon Gold Mine - Nicaragua
In the third quarter of 2018, El Limon Mine in Nicaragua produced 13,098 ounces of gold, 16%
(2,461 ounces) below original budget. Gold production at El Limon
also continued to be affected by the national political unrest,
resulting in delays for the required permits for explosives and
other shipments. However, by September, mining and processing
production had returned to planned levels.
El Limon's third quarter cash operating costs were $875 per ounce and AISC were $1,315 per ounce, both significantly above
budget, reflecting the impact of the lower than budgeted
production.
Year-to-date, El Limon Mine produced 37,736 ounces of gold, 14%
(6,182 ounces) below original budget. In addition to the disruption
discussed above, during the month of June, El Limon's gold
production was impacted by illegal road blockades. The blockades
were related to local employment issues for the community and were
resolved through dialogue with a newly developed community
stakeholder committee to ensure local concerns were
addressed.
For the first nine months of 2018, El Limon's cash operating
costs were $928 per ounce and AISC
were $1,500 per ounce, both
significantly above budget, reflecting the impact of the lower than
budgeted production. El Limon's per ounce cash costs are expected
to move closer to budget in the final quarter of the year as
production normalizes.
Total capital expenditures in the third quarter of 2018 were
$4 million, mainly consisting of
underground development costs for Santa
Pancha of $1 million and
mobile equipment purchases of $1
million. For the nine months ended September 30, 2018, capital expenditures were
$17 million, mainly consisting of
$6 million of underground development
costs for Santa Pancha, $3 million for the tailing storage facility and
$2 million for mobile equipment
purchases.
For full-year 2018, El Limon's gold production is expected to be
at the lower end of its revised production guidance range of
between 50,000 to 55,000 ounces of gold (original guidance was
between 55,000 to 60,000 ounces). However, the Company now expects
El Limon's cash operating costs to be between $850 to $900 per
ounce (original guidance was between $700 to $750 per
ounce) and AISC to be between $1,385
to $1,435 per ounce (original
guidance was between $1,135 to
$1,185 per ounce).
Exploration and Development
Fekola Gold Mine - Mali
In October 2018, B2Gold announced
(see news release dated 10/25/2018) a substantial increase
in the Mineral Resource estimate for the Fekola Mine and positive
results from the ongoing Fekola mill expansion study. The new
increased Mineral Resource and the positive results, to date, from
the Fekola mill expansion study indicate the potential to increase
mill throughput tonnage and increase annual gold production from
Fekola with moderate capital expenditure. Based on approximately
192,000 metres of exploration drilling in 928 drill holes
(including 70,877 metres in 294 holes drilled by B2Gold since
June 2014), B2Gold reported an
updated Indicated Mineral Resource estimate of 92,810,000 tonnes at
1.92 g/t gold, for a total of 5,730,000 ounces of gold, and an
Inferred Mineral Resource estimate of 26,500,000 tonnes at 1.61 g/t
gold, for a total of 1,370,000 ounces of gold, for the Fekola Mine.
Mineral Resources were reported within a pit shell using a
$1,400/ounce gold price and above a
cutoff of 0.6 g/t gold. Probable Reserves at the start of
production at Fekola were 49.2 million tonnes at 2.35 g/t gold
containing 3.7 million ounces. These initial reserves (less
material mined to December 31, 2017)
are contained within the updated resource. In addition, pit shells
were run using a gold price of $1,250/ounce and demonstrate Fekola's resiliency
to lower gold prices. The Indicated Mineral Resource contains
90,670,000 tonnes at 1.94 g/t gold for a total of 5,667,000 ounces
of gold, and Inferred Mineral Resources of 16,620,000 tonnes at
1.58 g/t gold containing 844,000 ounces of gold.
The new Mineral Resource is contiguous to the north of the
current Fekola reserve pit boundary and extends the resource pit
boundary 1.2 km to the north. Exploration drill results further
north of the new resource pit boundary demonstrate that gold
mineralization continues to the north, and remains open, indicating
the potential to further expand Mineral Resources with additional
drilling.
The B2Gold operations team is currently designing a new mine
plan based on the new Fekola Mineral Resource estimate, to
establish new Probable Mineral Reserves. In conjunction, an
engineering study is underway to evaluate the Fekola mill expansion
potential along with the evaluation of larger mining fleet options.
Current mill production rates have been averaging approximately 5.5
Mtpa during 2018. The expansion study is focused on expanding mill
throughput to 7.5 Mtpa. The economics of this case will be compared
to a baseline throughput of 5.5 Mtpa to 6.0 Mtpa. Given the
capacity of the Fekola primary crusher, SAG mill and ball mill, and
engineering work to date, the 7.5 Mtpa throughput can be achieved
with an upgrade of the existing ball mill circuit. Additional
process equipment upgrades will be required, which are being
determined in the expansion study along with capital and operating
cost estimates. The study is expected to be completed by year-end
2018 and the results will feed into the overall mine/mill expansion
evaluation to optimize the economics of the significantly larger,
new Fekola Mineral Resource. A technical report will be written
once the expansion study is completed.
El Limon Gold Mine - Nicaragua
In February 2018, the Company
announced a positive initial open-pit Inferred Mineral Resource at
the newly discovered El Limon Central zone at El Limon property in
Nicaragua of 5,130,000 tonnes at a
grade of 4.92 g/t of gold containing 812,000 ounces of gold (see
news release dated 02/23/2018). This resource has provided the
open-pit resources for the expansion study. Total Inferred Mineral
Resources from underground and open-pit sources included in this
study consist of approximately 6.0 million tonnes at a grade of 4.3
g/t, containing approximately 829,000 ounces. Mineral Resources
that are not Mineral Reserves do not have demonstrated economic
viability.
In October 2018, the Company
announced (see news release dated 10/22/2018) positive
results of an expansion study for El Limon Mine and that the
Company had signed a renewed two-year Collective Agreement with the
labour unions. The expansion study was conducted as a preliminary
economic assessment to evaluate the life-of-mine ("LoM") options
for combining the remaining underground Inferred Mineral Resources
with the new El Limon Central zone open-pit Inferred Mineral
Resource. The results of this study recommend the expansion of the
existing plant from 485,000 tonnes per annum ("tpa") to 600,000 tpa
and addition of a third stage of milling to achieve a fine grind.
The result would be a much longer mine life with significantly
higher gold production and lower cash operating costs and AISC. The
third stage of milling also allows for the reprocessing of old
tailings at the end of the mine life.
Positive drilling results continue to expand El Limon Central
zone to the north, indicating the potential to expand the Mineral
Resources. The zone is also open to depth, indicating the potential
to produce ore from underground in El Limon Central area once
open-pit mining is completed.
B2Gold's technical team is currently updating El Limon Inferred
Mineral Resource to include recent additional drilling results and
conducting mine optimization studies with a view to potentially
improve the positive economics for El Limon expansion. These
studies are expected to be completed in the first quarter of
2019.
Outlook and Strategy
B2Gold enjoyed a record first nine months of 2018, with record
gold revenue, gold sales and gold production resulting from the
first three full quarters of commercial production from its newest
mine, the Fekola Mine. 2018 has been another transformative,
record-setting year of low-cost gold production for B2Gold. With
the Company's dramatic increase in gold production and cash from
operations in 2018 and commitment to the pursuit of continued
growth through the exploration and development of the Company's
existing pipeline of assets, B2Gold remains well on target to
continue its transformational growth in 2018, including
consolidated gold production of between 920,000 and 960,000 ounces.
This represents an increase in annual consolidated gold production
of approximately 300,000 ounces (49%) in 2018 from 2017.
The Fekola Mine success is the latest in a series of accretive
acquisitions, construction and exploration successes that have
resulted in a steady rise in profitable production over the last 11
years, from 2007, when B2Gold was created as a junior exploration
company with no gold production, to the projected revised 2018
production range of between 920,000 and 960,000 ounces of gold from
the Company's five gold mines in four countries. In 2016, the
Company made a strategic decision to fund the construction of the
Fekola Mine without using equity to fund part of the construction
cost. Construction and pre-development of the Fekola Mine were
funded using a combination of operating cash flows from the
Company's existing mines, prepaid gold sales and available debt
facility capacity including the Company's RCF and Fekola equipment
financing loans. With the successful and earlier than anticipated
ramp up of the Fekola Mine in 2017, the Company is significantly
reducing its overall consolidated debt levels including the
repayment of the Company's $259
million convertible notes which occurred on October 1, 2018.
The Company's dramatic growth has been driven by a number of key
factors. Amongst them are: the Company's disciplined approach to
acquisitions, based on detailed due diligence by B2Gold's
experienced, technical, legal and financial teams; the Company's
demonstrated track record of success in operating in numerous
countries worldwide, the outstanding performance of our in-house
construction team; B2Gold's highly-experienced exploration team
that has realized significant exploration success at the Company's
properties; and our dedicated country and mine management teams and
employees, who are supported and empowered by our corporate
executive and management teams.
In October 2018, the Company made
a major announcement of a substantial increase in the Mineral
Resource estimate for the Fekola Mine and with positive results
from the ongoing Fekola mill expansion study to date, there is
potential to increase the Fekola Mine life while at the same time
increasing the Fekola mill throughput tonnage and increase annual
gold production from Fekola with moderate capital expenditure. In
addition, the Fekola North Extension remains open to the north.
For the remainder of 2018, exploration drilling will continue to
the immediate north and west of Fekola, and at the Anaconda zones
approximately 20 km from Fekola. In 2019, the Company plans to
continue its successful drilling to convert Fekola's Inferred
Resources to Reserves, further explore through drilling the
potential to the north and west of Fekola, and continue drilling at
and beneath the Anaconda saprolite zone.
Looking forward, B2Gold plans to: continue to optimize
production from its gold mines; strive to maintain its outstanding
health and safety records; continue its commitment to Corporate
Social Responsibility; remain in a strong financial position while
reducing debt levels; and pursue further organic growth through the
exploration and development of our impressive pipeline of existing
properties and new exploration initiatives.
Finally, B2Gold will continue to acquire exploration
opportunities directly and consider potential growth through
joint-ventures with high-quality exploration projects.
Qualified Persons
Peter D. Montano, P.E., the Project Director of B2Gold, a
qualified person under NI 43-101, has approved the scientific and
technical information related to operations matters contained in
this news release.
Tom Garagan, Senior Vice
President of Exploration of B2Gold, a qualified person under NI
43-101, has approved the scientific and technical information
regarding exploration matters contained in this news release.
Dale Craig, Vice President of
Operations at B2Gold, a qualified person under NI 43-101, has
approved the scientific and technical information regarding
engineering matters related to El Limon development contained in
this news release.
John Rajala, Vice President of
Metallurgy at B2Gold, a qualified person under NI 43-101, has
approved the scientific and technical information regarding
engineering matters related to Fekola expansion studies.
Third Quarter and First Nine Months of 2018 Financial Results
- Conference Call Details
B2Gold executives will host a conference call to discuss the
results on Wednesday, November 7,
2018, at 10:00 am PST / 1:00 pm EST.
You may access the call by dialing the operator at +1 647-788-4919
(local or international) or toll free at +1 877-291-4570 prior to
the scheduled start time or you may listen to the call via webcast
by clicking http://www.investorcalendar.com/event/38074. A playback
version of the call will be available for two weeks after the call
at +1 416-621-4642 (local or international) or toll free at +1
800-585-8367 (passcode 3855279).
On Behalf of B2GOLD CORP.
"Clive T.
Johnson"
President and Chief Executive
Officer
For more information on B2Gold please visit the Company website
at www.b2gold.com or contact:
Ian
MacLean
|
Katie
Bromley
|
Vice President,
Investor Relations
|
Manager, Investor
Relations & Public Relations
|
604-681-8371
|
604-681-8371
|
imaclean@b2gold.com
|
kbromley@b2gold.com
|
Cautionary Statement
The reader is advised that the results summarized in El Limon
expansion study news release are intended to provide only an
initial, high-level review of the project potential and expansion
options. The initial mine plans and economic models include
numerous assumptions and the use of Inferred Mineral Resources. El
Limon expansion study is preliminary in nature, and it includes
Inferred Mineral Resources that are considered too speculative
geologically to have the economic considerations applied to them
that would enable them to be categorized as Mineral Reserves. There
is no guarantee that Inferred Mineral Resources can be converted to
Indicated or Measured Mineral Resources and, consequently, there is
no guarantee the production estimates or project economics
described herein will be achieved.
Forward-looking Statement
The Toronto Stock Exchange and the NYSE American
LLC neither approve nor disapprove the information
contained in this news
release.
Production results and production guidance
presented in this news release reflect the total production at the
mines B2Gold operates on a 100% basis. Please see in
conjunction our Annual Information Form, dated March 23, 2018, and our Management
Discussion and Analysis dated the date
hereof for a discussion of our ownership interest in the
mines B2Gold operates.
This news release includes certain "forward-looking
information" and "forward-looking statements" (collectively
"forward-looking statements") within the meaning of applicable
Canadian and United States
securities legislation, including:
projections; outlook; guidance;
forecasts; estimates; and other
statements regarding future or estimated financial
and operational performance events, gold
production and sales, revenues and cash flows,
capital and operating costs, including projected cash
operating costs and AISC, and budgets;
statements regarding future or estimated mine life,
metal price assumptions, ore grades and
sources, stripping ratios, throughput, ore
processing; statements regarding anticipated
exploration, drilling, development, construction, permitting and
other activities or achievements of B2Gold;
and including, without limitation: B2Gold expecting to meet the
upper end of its revised gold production guidance range for the
full-year 2018; the ongoing benefits of the Fekola Mine
being in production and the resulting increase in
gold production levels combined with low costs being expected to
continue for many years, based on current assumptions; B2Gold
expecting to have an average cash flow from
operations of approximately $0.4
billion per annum over the next three years, if a gold price
assumption of $1,200 per ounce is
used; B2Gold expecting to have reduced its total debt
outstanding to approximately $500
million by December 31, 2018,
and such being a reduction of $200
million for the year; the engineering study to
evaluate the Fekola mill expansion potential along with the
evaluation of larger mining fleet options being completed by
year-end 2018, the results thereof being fed into an overall
mine/mill expansion evaluation to optimize the economics of the
significantly larger, new Fekola Mineral Resource, and a technical
report being written once the expansion study is completed;
additional process equipment upgrades being required at the Fekola
Mine mill, and such being determined in the expansion study along
with capital and operating cost estimates; higher grade ore
production being planned to resume from the Wolfshag Pit in late
2019; production from the underground operation at Jabali Antenna
Underground project being anticipated to commence by mid-fourth
quarter 2018; El Limon's gold production being expected to
meet its revised production guidance range for the full-year 2018;
the results of El Limon Mine plant expansion study as described
under the heading "El Limon Gold Mine - Nicaragua" on pages 11 to 12 above; El
Limon mine optimization studies being expected to be completed in
the first quarter of 2019; B2Gold planning, for the remainder of
2018 and beyond, to: continue to optimize production from its gold
mines; strive to maintain its outstanding health and safety
records; continue its commitment to Corporate Social
Responsibility; remain in a strong financial position while
reducing debt levels; and pursue further organic growth through the
exploration and development of our impressive pipeline of existing
properties and new exploration initiatives; brownfields exploration
making up approximately 80% of B2Gold's exploration budget, and
such focusing on drilling campaigns on existing projects; B2Gold's
exploration teams continuing drilling to infill and determine the
ultimate size of its significant exploration targets at the Toega
Project in Burkina Faso; and
B2Gold continuing to acquire and explore grass roots exploration
opportunities directly and considering potential
growth through joint-ventures and investments in junior companies
with high-quality exploration projects. Estimates of mineral
resources and reserves are also forward-looking statements because
they constitute projections regarding the amount of minerals that
may be encountered in the future and/or the anticipated economics
of production, should a production decision be made. All statements
in this news release that address events or developments that we
expect to occur in the future are forward-looking statements.
Forward-looking statements are statements that are not historical
facts and are generally, although not always, identified by words
such as "expect", "plan", "anticipate", "project", "target",
"potential", "schedule", "forecast", "budget", "estimate", "intend"
or "believe" and similar expressions or their negative
connotations, or that events or conditions "will", "would", "may",
"could", "should" or "might" occur. All such forward-looking
statements are based on the opinions and estimates of management as
of the date such statements are made.
Forward-looking statements necessarily involve assumptions,
risks and uncertainties, certain of which are beyond B2Gold's
control, including risks associated with or related to: the
volatility of metal prices and B2Gold's common shares; the dangers
inherent in exploration, development and mining activities; the
uncertainty of reserve and resource estimates; not achieving
production, cost or other estimates; actual production, development
plans and costs differing materially from the estimates in B2Gold's
feasibility studies; the ability to obtain and maintain any
necessary permits, consents or authorizations required for mining
activities; the current ongoing instability in Nicaragua; environmental regulations or
hazards and compliance with complex regulations associated with
mining activities; the ability to replace mineral reserves and
identify acquisition opportunities; the unknown liabilities of
companies acquired by B2Gold; the ability to successfully integrate
new acquisitions; fluctuations in exchange rates; the availability
of financing; financing and debt activities, including potential
restrictions imposed on B2Gold's operations as a result thereof and
the ability to generate sufficient cash flows; operations in
foreign and developing countries and the compliance with foreign
laws, including those associated with operations in Mali, Namibia, the
Philippines, Nicaragua and
Burkina Faso and including risks
related to changes in foreign laws and changing policies related to
mining and local ownership requirements; remote operations and the
availability of adequate infrastructure; fluctuations in price and
availability of energy and other inputs necessary for mining
operations; shortages or cost increases in necessary equipment,
supplies and labour; regulatory, political and country risks,
including local instability or acts of terrorism and the effects
thereof; the reliance upon contractors, third parties and joint
venture partners; the lack of sole decision-making authority
related to Filminera Resources Corporation, which owns the Masbate
Project; challenges to title or surface rights; the dependence on
key personnel and the ability to attract and retain skilled
personnel; the risk of an uninsurable or uninsured loss; adverse
climate and weather conditions; litigation risk; competition with
other mining companies; changes in tax laws; community support for
B2Gold's operations, including risks related to strikes and the
halting of such operations from time to time; conflicts with small
scale miners; failures of information systems or information
security threats; the final outcome of the audit by the Philippines
Department of Environment and Natural Resources in relation to the
Masbate Project; the ability to maintain adequate internal controls
over financial reporting as required by law, including Section 404
of the Sarbanes-Oxley Act; compliance with anti-corruption laws; as
well as other factors identified and as described in more detail
under the heading "Risk Factors" in B2Gold's most recent Annual
Information Form, B2Gold's current Form 40-F Annual Report and
B2Gold's other filings with Canadian securities regulators and the
U.S. Securities and Exchange Commission (the "SEC"), which may be
viewed at www.sedar.com and www.sec.gov, respectively (the
"Websites"). The list is not exhaustive of the factors
that may affect B2Gold's forward-looking statements.
B2Gold's forward-looking statements are based on the
applicable assumptions and factors management considers reasonable
as of the date hereof, based on the information available to
management at such time. These assumptions and factors include, but
are not limited to, assumptions and factors related to B2Gold's
ability to carry on current and future operations, including:
development and exploration activities; the timing, extent,
duration and economic viability of such operations, including any
mineral resources or reserves identified thereby; the accuracy and
reliability of estimates, projections, forecasts, studies and
assessments; B2Gold's ability to meet or achieve estimates,
projections and forecasts; the availability and cost of inputs; the
price and market for outputs, including gold; the timely receipt of
necessary approvals or permits; the ability to meet current and
future obligations; the ability to obtain timely financing on
reasonable terms when required; the current and future social,
economic and political conditions; and other assumptions and
factors generally associated with the mining industry.
B2Gold's forward-looking statements are based on the
opinions and estimates of management and reflect their
current expectations regarding future events and operating
performance and speak only as of the date hereof.
B2Gold does not assume any obligation to update forward-looking
statements if circumstances or management's beliefs, expectations
or opinions should change other than as required by applicable law.
There can be no assurance that forward-looking
statements will prove to be accurate, and actual results,
performance or achievements could differ materially from those
expressed in, or implied by, these forward-looking statements.
Accordingly, no assurance can be given that any events anticipated
by the forward-looking statements will transpire or occur, or if
any of them do, what benefits or liabilities B2Gold will derive
therefrom. For the reasons set forth above, undue reliance should
not be placed on forward-looking statements.
Non-IFRS Measures
This news release
includes certain terms or performance measures commonly used in the
mining industry that are not defined under International Financial
Reporting Standards ("IFRS"), including "cash operating
costs", "all-in sustaining costs" (or
"AISC"), and "adjusted net income". Non-IFRS measures
do not have any standardized meaning prescribed under IFRS, and
therefore they may not be comparable to similar measures employed
by other companies. The data presented is intended to provide
additional information and should not be considered in isolation or
as a substitute for measures of performance prepared in accordance
with IFRS and should be read in conjunction with B2Gold's
consolidated financial statements. Readers should refer to
B2Gold's Management Discussion
and Analysis, available on the
Websites, under the heading "Non-IFRS Measures" for a
more detailed discussion of how B2Gold calculates certain measures
and a reconciliation of certain measures to IFRS
terms.
Cautionary Note to United States
Investors
The disclosure in this news release was
prepared in accordance with Canadian National Instrument 43-101
("NI 43-101"), which differs significantly from the
current requirements of the SEC set out in Industry Guide
7. Accordingly, such disclosure may not be comparable to similar
information made public by companies that report in accordance
with Industry Guide 7. In particular, this news
release may refer to "mineral resources,"
"indicated mineral resources" or "inferred mineral
resources". While these categories of mineralization are recognized
and required by Canadian securities laws, they are not recognized
by Industry Guide 7 and are not normally permitted to
be disclosed in SEC filings by U.S. companies. U.S. investors are
cautioned not to assume that any part of a "mineral
resource," "indicated mineral resource"
or "inferred mineral resource" will ever be converted into a
"reserve." In addition, this news release uses the terms
"reserves" and "probable mineral reserves" which are
reported by the Company under Canadian standards and
may not qualify as reserves under Industry Guide
7. Under Industry Guide 7, mineralization may
not be classified as a "reserve" unless the mineralization can be
economically and legally extracted or produced at the time the
"reserve" determination is made. Accordingly, information contained
or referenced in this news release containing descriptions of the
Company's mineral deposits may not be compatible to similar
information made public by U.S. companies subject to the reporting
and disclosure requirements of Industry Guide 7.
"Inferred mineral resources" have a great amount of uncertainty as
to their existence and great uncertainty as to their economic and
legal feasibility. It cannot be assumed that all or any part of an
inferred mineral resource will ever be upgraded to a higher
category. Disclosure of "contained ounces" in a resource is
permitted disclosure under Canadian reporting standards;
however, Industry Guide 7 normally only permits
issuers to report mineralization that does not constitute
"reserves" by Industry Guide 7 standards as in-place
tonnage and grade without reference to unit measures.
Historical results or feasibility models presented herein are
not guarantees or expectations of future performance.
B2GOLD CORP.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30
(Expressed in thousands of United
States dollars, except per share amounts)
(Unaudited)
|
|
|
|
|
|
|
For the
three
months ended
Sept. 30, 2018
|
For the three
months ended
Sept. 30, 2017
|
|
For the
nine
months ended
Sept. 30, 2018
|
For the nine
months ended
Sept. 30, 2017
|
|
|
|
|
|
|
Gold
revenue
|
$
|
323,855
|
$
|
154,109
|
|
$
|
952,949
|
$
|
464,687
|
|
|
|
|
|
|
Cost of
sales
|
|
|
|
|
|
Production costs
|
(133,169)
|
(72,777)
|
|
(363,407)
|
(220,622)
|
Depreciation and depletion
|
(82,117)
|
(37,551)
|
|
(231,838)
|
(118,946)
|
Royalties and production taxes
|
(20,252)
|
(6,539)
|
|
(60,042)
|
(17,954)
|
Total cost of
sales
|
(235,538)
|
(116,867)
|
|
(655,287)
|
(357,522)
|
|
|
|
|
|
|
Gross
profit
|
88,317
|
37,242
|
|
297,662
|
107,165
|
|
|
|
|
|
|
General and
administrative
|
(12,418)
|
(8,485)
|
|
(35,178)
|
(25,229)
|
Share-based
payments
|
(9,422)
|
(3,938)
|
|
(16,382)
|
(13,252)
|
Impairment of
long-lived assets, net
|
(2,960)
|
—
|
|
(21,146)
|
—
|
Gain on sale of Lynn
Lake royalty
|
—
|
—
|
|
—
|
6,593
|
Write-down of mineral
property interests
|
(499)
|
(2,046)
|
|
(499)
|
(3,485)
|
Provision for
non-recoverable input taxes
|
1,558
|
208
|
|
(334)
|
(1,340)
|
Foreign exchange
gains (losses)
|
2,703
|
(1,472)
|
|
4,251
|
(2,880)
|
Other
|
305
|
(259)
|
|
(2,206)
|
(1,543)
|
Operating
income
|
67,584
|
21,250
|
|
226,168
|
66,029
|
|
|
|
|
|
|
Unrealized (loss)
gain on fair value of convertible notes
|
(1,441)
|
8,046
|
|
10,651
|
(3,932)
|
Community
relations
|
(1,912)
|
(1,658)
|
|
(4,317)
|
(4,329)
|
Interest and
financing expense
|
(7,585)
|
(2,140)
|
|
(24,375)
|
(7,411)
|
Realized gains
(losses) on derivative instruments
|
1,732
|
(1,344)
|
|
3,851
|
(2,684)
|
Unrealized gains
(losses) on derivative instruments
|
2,269
|
2,454
|
|
8,269
|
(16)
|
Write-down of
long-term investments
|
—
|
(157)
|
|
—
|
(1,613)
|
Other
|
516
|
(1,230)
|
|
279
|
(1,421)
|
Income before
taxes
|
61,163
|
25,221
|
|
220,526
|
44,623
|
|
|
|
|
|
|
Current income tax,
withholding and other taxes expense
|
(26,448)
|
(6,975)
|
|
(89,180)
|
(14,233)
|
Deferred income tax
expense
|
(18,679)
|
(5,853)
|
|
(36,549)
|
(3,290)
|
Net income for the
period
|
$
|
16,036
|
$
|
12,393
|
|
$
|
94,797
|
$
|
27,100
|
|
|
|
|
|
|
Attributable
to:
|
|
|
|
|
|
Shareholders of the Company
|
$
|
10,598
|
$
|
11,443
|
|
$
|
87,886
|
$
|
26,973
|
Non-controlling interests
|
5,438
|
950
|
|
6,911
|
127
|
Net income for the
period
|
$
|
16,036
|
$
|
12,393
|
|
$
|
94,797
|
$
|
27,100
|
|
|
|
|
|
|
Earnings per
share (attributable to shareholders of the
Company)
|
|
|
|
|
|
Basic
|
$
|
0.01
|
$
|
0.01
|
|
$
|
0.09
|
$
|
0.03
|
Diluted
|
$
|
0.01
|
$
0.00
|
|
$
|
0.07
|
$
|
0.03
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding (in
thousands)
|
|
|
|
|
|
Basic
|
988,795
|
978,680
|
|
985,226
|
975,246
|
Diluted
|
999,347
|
1,058,345
|
|
1,063,901
|
990,946
|
B2GOLD CORP.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30
(Expressed in thousands of United
States dollars)
(Unaudited)
|
|
|
|
|
|
|
For the
three
months ended
Sept. 30, 2018
|
For the three
months ended
Sept. 30, 2017
|
|
For the
nine
months ended
Sept. 30, 2018
|
For the nine
months ended
Sept. 30, 2017
|
Operating
activities
|
|
|
|
|
|
Net income for the
period
|
$
|
16,036
|
$
|
12,393
|
|
$
|
94,797
|
$
|
27,100
|
Mine restoration
provisions settled
|
(98)
|
(231)
|
|
(326)
|
(255)
|
Non-cash charges,
net
|
102,476
|
27,377
|
|
264,897
|
101,378
|
Changes in non-cash
working capital
|
20,801
|
2,511
|
|
16,080
|
(22,814)
|
Proceeds from prepaid
sales
|
—
|
—
|
|
—
|
30,000
|
Changes in long-term
value added tax receivables
|
4,020
|
(278)
|
|
1,274
|
(6,015)
|
Cash provided by
operating activities
|
143,235
|
41,772
|
|
376,722
|
129,394
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
|
Credit facility
drawdowns, net of transaction costs
|
200,000
|
70,699
|
|
225,000
|
120,341
|
Repayment of credit
facility
|
(25,000)
|
—
|
|
(175,000)
|
—
|
Equipment loan
facilities, drawdowns net of transaction costs
|
—
|
14,199
|
|
28,848
|
51,331
|
Repayment of
equipment loan facilities
|
(7,291)
|
(2,579)
|
|
(20,463)
|
(9,114)
|
Interest and
commitment fees paid
|
(5,299)
|
(1,485)
|
|
(26,194)
|
(11,033)
|
Common shares issued
for cash on exercise of stock options
|
5,550
|
1,869
|
|
15,457
|
25,068
|
Restricted cash
movement
|
—
|
(849)
|
|
(1,379)
|
(6,948)
|
Other
|
(341)
|
(416)
|
|
(1,158)
|
(1,135)
|
Cash provided by
financing activities
|
167,619
|
81,438
|
|
45,111
|
168,510
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
|
Expenditures on
mining interests:
|
|
|
|
|
|
Fekola Mine,
development and sustaining capital
|
(17,128)
|
(65,318)
|
|
(53,537)
|
(208,109)
|
Otjikoto Mine,
development and sustaining capital
|
(11,747)
|
(20,881)
|
|
(41,379)
|
(36,088)
|
Masbate Mine,
development and sustaining capital
|
(12,096)
|
(6,114)
|
|
(33,493)
|
(36,480)
|
Libertad Mine,
development and sustaining capital
|
(2,568)
|
(5,868)
|
|
(12,608)
|
(18,137)
|
Limon Mine,
development and sustaining capital
|
(4,082)
|
(4,541)
|
|
(17,285)
|
(10,976)
|
Gramalote Project,
prefeasibility and exploration
|
(1,563)
|
(3,512)
|
|
(6,040)
|
(8,692)
|
Other exploration and
development
|
(14,192)
|
(14,942)
|
|
(47,057)
|
(40,615)
|
Cash proceeds from
sale of Lynn Lake royalty, net of transaction costs
|
—
|
—
|
|
—
|
6,593
|
Purchase of
non-controlling interest
|
—
|
—
|
|
(2,500)
|
—
|
Other
|
878
|
(84)
|
|
808
|
(201)
|
Cash used by
investing activities
|
(62,498)
|
(121,260)
|
|
(213,091)
|
(352,705)
|
|
|
|
|
|
|
Increase
(decrease) in cash and cash equivalents
|
248,356
|
1,950
|
|
208,742
|
(54,801)
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(467)
|
(434)
|
|
(1,369)
|
(161)
|
Cash and cash
equivalents, beginning of period
|
106,952
|
88,193
|
|
147,468
|
144,671
|
Cash and cash
equivalents, end of period
|
$
|
354,841
|
$
|
89,709
|
|
$
|
354,841
|
$
|
89,709
|
B2GOLD CORP.
CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS
(Expressed in thousands of United
States dollars)
(Unaudited)
|
|
|
|
|
As at September
30,
2018
|
|
As at December
31,
2017
|
Assets
|
|
|
|
Current
|
|
|
|
Cash and cash
equivalents
|
$
|
354,841
|
|
$
|
147,468
|
Accounts receivable,
prepaids and other
|
24,842
|
|
20,603
|
Value-added and other
tax receivables
|
14,101
|
|
21,335
|
Inventories
|
223,782
|
|
206,445
|
|
617,566
|
|
395,851
|
|
|
|
|
Long-term
investments
|
6,035
|
|
9,744
|
Value-added tax
receivables
|
22,113
|
|
22,318
|
Mining
interests
|
|
|
|
Owned by
subsidiaries
|
2,078,071
|
|
2,124,133
|
Investments in joint
ventures
|
70,986
|
|
65,830
|
Other
assets
|
40,773
|
|
39,848
|
Deferred income
taxes
|
12,051
|
|
27,433
|
|
$
|
2,847,595
|
|
$
|
2,685,157
|
Liabilities
|
|
|
|
Current
|
|
|
|
Accounts payable and
accrued liabilities
|
$
|
70,021
|
|
$
|
95,092
|
Current income and
other taxes payable
|
76,375
|
|
26,448
|
Current portion of
derivative instruments at fair value
|
1,276
|
|
4,952
|
Current portion of
long-term debt
|
289,174
|
|
302,630
|
Current portion of
prepaid sales
|
45,000
|
|
60,000
|
Current portion of
mine restoration provisions
|
2,349
|
|
1,819
|
Other current
liabilities
|
1,447
|
|
3,603
|
|
485,642
|
|
494,544
|
Long-term
debt
|
457,756
|
|
399,551
|
Prepaid
sales
|
—
|
|
30,000
|
Mine restoration
provisions
|
99,046
|
|
96,627
|
Deferred income
taxes
|
102,684
|
|
81,518
|
Employee benefits
obligation
|
11,106
|
|
14,708
|
Other long-term
liabilities
|
1,880
|
|
1,816
|
|
1,158,114
|
|
1,118,764
|
Equity
|
|
|
|
Shareholders'
equity
|
|
|
|
Share
capital
|
|
|
|
Issued:
989,609,160 common shares (Dec 31, 2017 –
980,932,908)
|
2,221,564
|
|
2,197,267
|
Contributed
surplus
|
69,151
|
|
60,039
|
Accumulated other
comprehensive loss
|
(144,273)
|
|
(94,294)
|
Deficit
|
(490,243)
|
|
(610,908)
|
|
1,656,199
|
|
1,552,104
|
Non-controlling
interests
|
33,282
|
|
14,289
|
|
1,689,481
|
|
1,566,393
|
|
$
|
2,847,595
|
|
$
|
2,685,157
|
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SOURCE B2Gold Corp.