VANCOUVER, Nov. 5, 2019
/CNW/ - B2Gold Corp. (TSX: BTO, NYSE AMERICAN: BTG,
NSX: B2G) ("B2Gold" or the "Company") is pleased to announce its
operational and financial results for the third quarter and first
nine months of 2019. All dollar figures are in United States dollars unless otherwise
indicated. B2Gold is also pleased to announce that, as part of the
Company's long-term strategy to maximize shareholder value, the
board of directors of the Company (the "Board of Directors")
declared B2Gold's first dividend of $0.01 per common share, and expects to declare
future dividends quarterly at the same level, which on an
annualized basis would amount to $0.04 per common share (see "B2Gold Declares
First Dividend" section below).
On October 15, 2019, B2Gold and
Calibre Mining Corp. ("Calibre") completed the transaction for
B2Gold to restructure its interests in, and for Calibre to acquire,
El Limon and La Libertad mines (see "B2Gold and Calibre Join
Forces in Nicaragua" section
below). Accordingly, the Company has classified its El Limon
and La Libertad mines as discontinued operations for the three and
nine months ended September 30, 2019
and 2018 for financial reporting purposes.
2019 Third Quarter Highlights
- Record quarterly consolidated gold production of 258,200 ounces
(including El Limon and La Libertad) well-above budget by 7%
(15,807 ounces) and 7% (16,160 ounces) over the same period last
year with solid performances from all of the Company's
operations
- Consolidated gold revenues from continuing operations of
$311 million on sales of 208,900
ounces (2% or 3,801 ounces above budget); consolidated gold
revenues (see "Non-IFRS Measures") of $382 million on sales of 256,670 ounces,
including gold sales from El Limon and La Libertad
- Consolidated cash operating costs (see "Non-IFRS
Measures") from continuing operations of $443 per ounce produced ($433 per ounce sold), well-below budget by
$47 per ounce (10%); including El
Limon and La Libertad, consolidated cash operating costs of
$507 per ounce produced ($507 per ounce sold), below budget by
$36 per ounce (7%)
- Consolidated all-in sustaining costs ("AISC") (see "Non-IFRS
Measures") from continuing operations of $755 per ounce sold, below budget by $10 per ounce (1%); including El Limon and La
Libertad, consolidated AISC of $807
per ounce sold, in-line with budget
- Consolidated cash flow provided by operating activities of
$168 million (including $30 million from discontinued operations)
compared to $143 million (including
$7 million from discontinued
operations) in the prior-year quarter
- Net income attributable to the shareholders of the Company of
$56 million ($0.05 per share); adjusted net income
attributable to the shareholders (see "Non-IFRS Measures")
of the Company of $89 million
($0.09 per share)
- For the fourth quarter of 2019, B2Gold's Board of Directors
declared its first dividend of $0.01
per common share and expects to declare future dividends quarterly
at the same level (which on an annualized basis would amount to
$0.04 per common share), subject to
authorization of the Board of Directors and all applicable
laws
- Otjikoto Mine continued its remarkable safety performance,
extending the number of days without a lost-time-injury ("LTI") to
552 days (4.6 million man-hours) at the end of the third quarter of
2019
- On October 15, 2019, B2Gold and
Calibre completed an agreement for B2Gold to restructure its
interests in, and for Calibre to acquire, El Limon and La Libertad
gold mines for aggregate consideration of $100 million (subject to an additional payment
for net working capital acquired)
2019 First Nine Months Highlights
- Record year-to-date consolidated gold production of 735,079
ounces (including El Limon and La Libertad), 7% (45,705 ounces)
above budget and 2% (13,262 ounces) over the same period last
year
- Consolidated gold revenues from continuing operations of
$842 million on sales of 616,000
ounces (5% or 31,382 ounces above budget); consolidated gold
revenues (see "Non-IFRS Measures") of $994 million on sales of 725,028 ounces,
including gold sales from El Limon and La Libertad
- Consolidated cash operating costs from continuing operations of
$451 per ounce produced ($452 per ounce sold), well-below budget by
$45 per ounce (9%); including El
Limon and La Libertad, consolidated cash operating costs of
$527 per ounce produced ($531 per ounce sold), below budget by
$33 per ounce (6%)
- Consolidated AISC from continuing operations of $768 per ounce sold, well-below budget by
$70 per ounce (8%); including El
Limon and La Libertad, consolidated AISC of $855 per ounce sold, below budget by $54 per ounce (6%)
- Consolidated cash flow provided by operating activities of
$347 million (including $41 million from discontinued operations)
- Net income attributable to the shareholders of the Company of
$116 million ($0.11 per share); adjusted net income
attributable to the shareholders of the Company of $169 million ($0.17
per share)
- Debt repayments totaling $100
million on the outstanding balance of the Company's
revolving credit facility ("RCF") with a further $100 million expected to be repaid in the fourth
quarter of 2019, which will leave an estimated drawn balance on the
RCF of $200 million at December 31, 2019, and an estimated available
balance of $400 million; total debt
outstanding at December 31, 2019,
including equipment loans and leases, is forecast to be
approximately $260 million, a
reduction in the year of $220 million
from opening total debt of approximately $480 million
- For full-year 2019, the Company forecasts consolidated gold
production to come in towards the midpoint of its previously stated
guidance range of between 935,000 and 975,000 ounces, with cash
operating costs forecast to be at or below the lower end of the
Company's $520 and $560 per ounce guidance range and AISC to be
within the Company's $835 and
$875 per ounce guidance range
- New large-scale off-grid Fekola Solar Plant Project approved by
the B2Gold Board of Directors, scheduled for completion in
August 2020; expected to provide
significant operating cost reductions (estimated to reduce Fekola's
processing costs by approximately 7%)
- On March 26, 2019, the Company
announced positive results from the Expansion Study Preliminary
Economic Assessment ("PEA") for the Fekola Mine, including
significant estimated increases in average annual gold production
to over 550,000 ounces per year during the five-year period
2020-2024, and is proceeding with an expansion project to increase
Fekola's processing throughput by 1.5 million tonnes per annum
("Mtpa") to 7.5 Mtpa from an assumed base rate of 6 Mtpa
- Based on B2Gold's current projections, production at the Fekola
Mine in 2020 is projected to be approximately 600,000 ounces of
gold (primarily due to the addition of a larger mining fleet at
Fekola and the optimization of the mining sequence in early 2020,
prior to completion of the mill expansion); following completion of
the mill expansion, production from the Fekola Mine is projected to
average 550,000 ounces of gold over the next five years based on
current assumptions
- On September 16, 2019, the
Company announced positive drill results from the Mamba zone which
is located within the Anaconda area approximately 20 kilometres
from the Fekola Mine, as well as positive infill drill results from
the Fekola Mineral Resource area and step out results north of the
Fekola resource
2019 Third Quarter and First
Nine Months Operational Results
Consolidated gold production from continuing operations totaled
213,278 ounces in the third quarter of 2019, above budget by 4%
(8,788 ounces) and the prior-year quarter by 3% (6,331 ounces).
Including El Limon and La Libertad, consolidated gold production in
the third quarter of 2019 was a quarterly record of 258,200 ounces,
well-above budget by 7% (15,807 ounces) and 7% (16,160 ounces)
higher compared to the prior-year quarter, with solid performances
from all of the Company's operations. Gold production from each of
the Company's mines exceeded their targeted production for the
quarter. In addition, based on Fekola's strong year-to-date
performance, the Company has revised Fekola's production guidance
range higher to be between 445,000 to 455,000 ounces of gold
(original guidance range was between 420,000 to 430,000
ounces).
Consolidated cash operating costs from continuing operations in
the third quarter of 2019 were $443
per ounce produced ($433 per ounce
sold), well-below budget by $47 per
ounce (10%) and comparable with the third quarter of 2018. The
favourable budget variance was mainly attributable to
higher-than-budgeted production. Including El Limon and La
Libertad, consolidated cash operating costs were $507 per ounce produced ($507 per ounce sold), below budget by
$36 per ounce (7%) and comparable
with the prior-year quarter.
Consolidated AISC from continuing operations in the third
quarter of 2019 were $755 per ounce
sold (Q3 2018 - $644 per ounce sold),
below budget by $10 per ounce (1%).
Including El Limon and La Libertad, consolidated AISC were
$807 per ounce sold (Q3 2018 -
$717 per ounce sold), in-line with
budget.
Year-to-date, consolidated gold production from continuing
operations totaled 622,710 ounces, well-above budget by 7% (39,181
ounces). Including El Limon and La Libertad, consolidated gold
production was a year-to-date record of 735,079 ounces, well-above
budget by 7% (45,705 ounces) and 2% (13,262 ounces) higher compared
to the first nine months of 2018.
Year-to-date, consolidated cash operating costs from continuing
operations were $451 per ounce
produced ($452 per ounce sold) (first
nine months of 2018 - $416 per ounce
produced), well-below budget by $45
per ounce (9%). Including El Limon and La Libertad mines,
consolidated cash operating costs were $527 per ounce produced ($531 per ounce sold), below budget by
$33 per ounce (6%).
Year-to-date, consolidated AISC from continuing operations were
$768 per ounce sold (year-to-date
2018 - $640 per ounce sold),
well-below budget by $70 per ounce
(8%). Including El Limon and La Libertad mines, consolidated AISC
were $855 per ounce sold, below
budget by $54 per ounce (6%).
B2Gold remains well positioned for continued strong operational
and financial performance in 2019. For full-year 2019, the Company
forecasts consolidated gold production to come in towards the
midpoint of its previously stated guidance range of between 935,000
and 975,000 ounces. The gold production outperformance experienced
in the first nine months of 2019 together with the uplift in
guidance for Fekola are anticipated to more than offset the
Company's reduced share of production from El Limon and La Libertad
following their sale to Calibre on October
15, 2019. Consolidated cash costs are projected to remain
low in 2019 with cash operating costs forecast to be at or below
the lower end of the Company's $520
and $560 per ounce guidance range and
AISC to be within the Company's $835
and $875 per ounce guidance
range.
B2Gold and Calibre Join Forces in Nicaragua
On October 15, 2019, B2Gold
completed the sale of El Limon and La Libertad gold mines, the
Pavon gold project and additional mineral concessions in
Nicaragua (collectively, the
"Nicaragua Assets") to Calibre for aggregate consideration of
$100 million (consisting of a
combination of cash, common shares and a convertible debenture)
(the "Calibre Transaction"), plus an additional payment for net
working capital acquired under the share purchase agreement for the
Calibre Transaction. As a result of closing the Calibre
Transaction, B2Gold now holds approximately 30% of the total issued
and outstanding Calibre common shares.
2019 Third Quarter and First
Nine Months Financial Results
Consolidated gold revenue from continuing operations for the
third quarter of 2019 was $311
million on sales of 208,900 ounces at an average price of
$1,488 per ounce compared to
$280 million on sales of 232,209
ounces at an average price of $1,206
per ounce in the third quarter of 2018. The increase in gold
revenue of $31 million (11%) was
attributable to a 23% increase in the average realized gold price
partially offset by a 10% decrease in the gold ounces sold (due to
the timing of gold sales). Including El Limon and La Libertad,
consolidated gold revenue was $382
million on sales of 256,670 ounces at an average realized
price of $1,489 per ounce.
Cash flow provided by operating activities from continuing
operations was $138 million in the
third quarter of 2019 compared to $137
million in the prior-year quarter. Cash flow provided by
operating activities (including discontinued operations) was
$168 million in the third quarter of
2019 compared to $143 million in the
third quarter of 2018, an increase of $25
million.
For the third quarter of 2019, net income attributable to the
shareholders of the Company was $56
million ($0.05 per share)
compared to $11 million ($0.01 per share) in the prior-year quarter.
Adjusted net income attributable to the shareholders of the Company
was $89 million ($0.09 per share) compared to $38 million ($0.04
per share) in the third quarter of 2018.
Year-to-date, consolidated gold revenue from continuing
operations was $842 million on sales
of 616,000 ounces at an average price of $1,367 per ounce compared to $821 million on sales of 645,667 ounces at an
average price of $1,271 per ounce in
the first nine months of 2018. The $21
million (3%) increase in gold revenue was attributable to an
8% increase in the average realized gold price partially offset by
a 5% decrease in the gold ounces sold (due to the timing of gold
sales). Including El Limon and La Libertad, consolidated gold
revenue was $994 million on sales of
725,028 ounces at an average realized price of $1,371 per ounce.
Cash flow provided by operating activities from continuing
operations was $306 million in the
first nine months of 2019 compared to $355
million in same period last year. Cash flow provided by
operating activities (including discontinued operations) was
$347 million in the first nine months
of 2019 compared to $377 million in
the first nine months of 2018. The decrease mainly reflects higher
income tax installment payments, partially offset by higher
revenues.
For the first nine months of 2019, net income attributable to
the shareholders of the Company was $116
million ($0.11 per share)
compared to $88 million ($0.09 per share) in the same period last year.
Adjusted net income attributable to the shareholders of the Company
was $169 million ($0.17 per share) compared to $138 million ($0.14
per share) in the first nine months of 2018.
B2Gold Declares First Dividend
B2Gold is also pleased to announce that, as part of the
Company's long-term strategy to maximize shareholder value, on
November 5, 2019, the Board of
Directors of the Company declared B2Gold's first quarterly dividend
of $0.01 per common share, which will
be paid on December 13, 2019, to
shareholders of record as at the close of business on November 29, 2019. This dividend is designated as
an "eligible dividend" for the purposes of the Income Tax Act
(Canada). Dividends paid by B2Gold
to shareholders outside Canada
(non-resident investors) will be subject to Canadian non-resident
withholding taxes.
Following the payment of this dividend, the Board of Directors
expects to declare future dividends quarterly at the same level, in
the amount of $0.01 per common share,
and has determined that this anticipated level of quarterly
dividend is appropriate based on the Company's current financial
performance, liquidity and outlook. Subject to authorization by the
Board of Directors and compliance with all applicable laws, the
record date for future dividends is anticipated to be set as of the
last business day of March, June, September and December in each
year and the payment date in each case is anticipated to be
approximately two weeks from such record date. The exact
record date and other details of future dividends, if any, will be
announced by the Company separately at such time any dividend is
declared and authorized by the Board of Directors.
The declaration and payment of future dividends and the amount
of any such dividends will be subject to the determination of the
Board of Directors, in its sole and absolute discretion, taking
into account, among other things, economic conditions, business
performance, financial condition, growth plans, expected capital
requirements, compliance with the Company's constating documents,
all applicable laws, including the rules and policies of any
applicable stock exchange, as well as any contractual restrictions
on such dividends, including any agreements entered into with
lenders to the Company, and any other factors that the Board of
Directors deems appropriate at the relevant time. There can be
no assurance that any dividends will be paid at the intended rate
or at all in the future.
Liquidity and Capital Resources
At September 30, 2019, the Company had cash and cash
equivalents of $146 million
(excluding $19 million of cash
associated with discontinued operations) compared to cash and cash
equivalents of $103 million at
December 31, 2018. Working capital at
September 30, 2019 (excluding $34
million of working capital related to assets and liabilities
classified as held for sale) was $236
million compared to $156
million at December 31, 2018
(December 31, 2018 balance sheet
presentation remains unchanged).
During the nine months ended September
30, 2019, the Company repaid $100
million of the outstanding balance on its RCF. At
September 30, 2019, the Company had drawn $300 million under the $600 million RCF, leaving an undrawn and
available balance under the existing facility of $300 million. The Company expects to repay a
further $100 million of the
outstanding RCF balance in the fourth quarter of 2019, which will
leave an estimated drawn balance on the RCF of $200 million at December
31, 2019, and an estimated available balance of $400 million. Total debt outstanding at
December 31, 2019, including
equipment loans and leases, is forecast to be approximately
$260 million, a reduction in the year
of $220 million from opening total
debt of approximately $480
million.
The Company's ongoing strategy is to continue to maximize
profitable production from its mines, reduce debt, expand the
Fekola Mine throughput and annual production, further advance its
pipeline of development and exploration projects and evaluate
exploration opportunities.
Operations
Mine-by-mine gold production (ounces) in the third quarter and
first nine months of 2019 was as follows:
Mine
|
Q3
2019 Gold
Production (ounces)
(1)
|
YTD
2019 Gold
Production (ounces)
(1)
|
Revised Annual Guidance Gold Production
(ounces) (2)
|
Original Annual Guidance Gold Production
(ounces) (1)
|
Fekola
|
112,321
|
336,567
|
445,000 -
455,000
|
420,000 -
430,000
|
Masbate
|
51,546
|
166,599
|
200,000 -
210,000
|
200,000 -
210,000
|
Otjikoto
|
49,411
|
119,544
|
165,000 -
175,000
|
165,000 -
175,000
|
From
Continuing
Operations
|
213,278
|
622,710
|
810,000 -
840,000
|
785,000 -
815,000
|
La
Libertad
|
24,419
|
68,177
|
75,000 -
80,000
|
95,000 -
100,000
|
El Limon
|
20,503
|
44,192
|
50,000 -
55,000
|
55,000 -
60,000
|
From
Discontinued Operations
|
44,922
|
112,369
|
125,000 -
135,000
|
150,000 -
160,000
|
|
|
|
|
|
B2Gold
Consolidated
|
258,200
|
735,079
|
935,000 -
975,000
|
935,000 -
975,000
|
|
|
(1)
|
B2Gold's Q3 2019 and
year-to-date 2019 gold production results and 2019 original annual
production guidance are presented on a 100% basis.
|
|
|
(2)
|
B2Gold's 2019 revised
annual production guidance includes 100% forecast production from
its Fekola, Masbate and Otjikoto mines. For El Limon and La
Libertad, as a result of their sale to Calibre on October 15, 2019,
B2Gold's 2019 revised annual production guidance includes 100% of
their forecast production up to the date of their sale and
thereafter approximately 30% of their forecast production (from
between October 15, 2019, to December 31, 2019, subject to
reduction if B2Gold's interest in Calibre dilutes), representing
the Company's indirect ownership interest in the Nicaraguan
operations through its equity investment in Calibre.
|
Mine-by-mine cash operating costs (on a per ounce of gold sold
basis) in the third quarter and first nine months of 2019 were as
follows (based on the total operations at the mines B2Gold
operates):
Mine
|
Q3
2019 Cash Operating
Costs ($ per ounce
sold)
|
YTD
2019 Cash Operating
Costs ($ per ounce
sold)
|
2019 Annual
Guidance Cash Operating
Costs ($ per ounce
sold)
|
Fekola
|
$361
|
$378
|
$370 -
$410
|
Masbate
|
$588
|
$567
|
$625 -
$665
|
Otjikoto
|
$431
|
$501
|
$520 -
$560
|
From Continuing
Operations
|
$433
|
$452
|
$465-
$505
|
|
|
|
|
La
Libertad
|
$973
|
$1,077
|
$840 -
$880
|
El Limon
|
$664
|
$821
|
$720 -
$760
|
From
Discontinued Operations
|
$831
|
$976
|
$795 -
$835
|
|
|
|
|
B2Gold
Consolidated
|
$507
|
$531
|
$520 -
$560
|
Mine-by-mine cash operating costs (on a per ounce of gold
produced basis), in the third quarter and first nine months of 2019
were as follows (based on the total operations at the mines B2Gold
operates):
Mine
|
Q3
2019 Cash Operating
Costs ($ per ounce
produced)
|
YTD
2019 Cash Operating
Costs ($ per ounce
produced)
|
Fekola
|
$383
|
$378
|
Masbate
|
$622
|
$564
|
Otjikoto
|
$394
|
$501
|
From Continuing
Operations
|
$443
|
$451
|
|
|
|
La
Libertad
|
$957
|
$1,056
|
El Limon
|
$636
|
$786
|
From
Discontinued Operations
|
$810
|
$949
|
|
|
|
B2Gold
Consolidated
|
$507
|
$527
|
Mine-by-mine AISC per ounce (on a per ounce of gold sold basis)
in the third quarter and first nine months of 2019 were as follows
(based on the total operations at the mines B2Gold
operates):
Mine
|
Q3
2019 AISC ($
per ounce sold)
|
YTD
2019 AISC ($
per ounce sold)
|
2019 Annual
Guidance AISC ($
per ounce sold)
|
Fekola
|
$642
|
$626
|
$625 -
$665
|
Masbate
|
$833
|
$773
|
$860 -
$900
|
Otjikoto
|
$743
|
$895
|
$905 -
$945
|
From Continuing
Operations
|
$755
|
$768
|
$745 -
$785
|
|
|
|
|
La
Libertad
|
$1,116
|
$1,415
|
$1,150 -
$1,190
|
El Limon
|
$945
|
$1,251
|
$1,005 -
$1,045
|
From
Discontinued Operations
|
$1,038
|
$1,350
|
$1,095 -
$1,135
|
|
|
|
|
B2Gold
Consolidated
|
$807
|
$855
|
$835 -
$875
|
Fekola Gold Mine - Mali
The Fekola Mine in Mali
continued its very strong operational performance with third
quarter gold production of 112,321 ounces, above budget by 4%
(3,958 ounces) and 5% (5,319 ounces) higher compared to the
prior-year quarter, as the Fekola processing facilities continued
to outperform. The operation continued to demonstrate sustained
high processing throughput without reduced recoveries.
For the third quarter of 2019, mill throughput was 1.7 million
tonnes, exceeding budget by 15% and the prior-year quarter by 23%.
The average grade processed was 2.16 grams per tonne ("g/t")
together with average gold recoveries of 94.1%. Continuing the
trends set in the first-half of the year, processing of ore with
favourable metallurgical characteristics (including oxidized
saprolite ore) combined with finer than budgeted feed size from the
primary crusher (due to a combination of better ore fragmentation
in the pit and softer low-grade ore) has allowed for the processing
of additional lower grade ore from stockpile and run-of-mine
sources, beyond what was originally budgeted. This has resulted in
a lower average processed grade, but also a significant increase in
gold production along with marginally increased cash operating
costs per ounce. Gold tonnage and grade continue to reconcile well
with the resource model.
Fekola's third quarter cash operating costs were $383 per ounce produced ($361 per gold ounce sold), below budget by
$11 per ounce (3%) and comparable
with the prior-year quarter. Fekola's AISC for the quarter were
$642 per ounce sold (Q3 2018 -
$561 per ounce sold), slightly above
budget by $25 per ounce (4%), due to
higher-than-budgeted sustaining capital expenditures (as a result
of timing differences) and royalties (as a result of higher
realized gold prices than budgeted), partially offset by slightly
lower cash operating costs.
Year-to-date, gold production at the Fekola Mine was 336,567
ounces, well above budget by 7% (20,954 ounces) and 1% (2,779
ounces) higher than the first nine months of 2018.
Fekola's cash costs remained below budget in the first nine
months of 2019. Cash operating costs were $378 per ounce produced ($378 per gold ounce sold) (year-to-date 2018 -
$321 per ounce produced),
$10 per ounce (3%) below budget, and
AISC were $626 per ounce sold (first
nine months of 2018 - $499 per ounce
sold), $30 per ounce (5%) below
budget.
Capital expenditures in the third quarter of 2019 totaled
$31 million, mainly consisting of
$12 million for the mine expansion
and $5 million for the plant
expansion, $6 million for
pre-stripping, and $3 million for
capitalized mobile equipment rebuilds. Capital expenditures in the
first nine months of 2019 totaled $65
million mainly consisting of $15
million for pre-stripping, $13
million for the mine expansion and $9
million for the plant expansion, $7
million to complete the relocation of the Fadougou Village,
$6 million for mining equipment and
$6 million for capitalized equipment
rebuilds.
Fekola Mine Expansion
On March 26, 2019, the Company
announced very positive results from the Expansion Study PEA for
the Fekola Mine. As a result, the Company is proceeding with an
expansion project to increase processing throughput by 1.5 Mtpa to
7.5 Mtpa from an assumed base rate of 6 Mtpa. The PEA took into
account the significant increase in the Fekola Mineral Resource
announced on October 25, 2018. Based
on the PEA, once this expansion is complete, the Fekola Mine is
expected to produce more gold over a longer life, with more robust
economics and higher average annual gold production, revenues and
cash flows than the previous life-of-mine ("LoM"). Project economic
highlights from the PEA include: estimated optimized LoM extended
into 2030, including significant estimated increases in average
annual gold production to over 550,000 ounces per year during the
five-year period 2020-2024 and over 400,000 ounces per year over
the LoM (2019-2030); projected gold production of approximately
five million ounces over the new mine life of 12 years of mining
and processing (including 2019); an increase in project pre-tax net
present value of approximately $500
million versus the comparable amounts in the Company's
latest Annual Information Form Mineral Reserve LoM model (filed on
SEDAR on March 20, 2019) (assuming an
effective date of January 1, 2019, a
gold price of $1,300 per ounce and a
discount rate of 5%); and forecast LoM pre-tax net present value of
over $2.2 billion.
The processing upgrade will focus on increased ball mill power,
with upgrades to other components including a new cyclone
classification system, pebble crushers, and additional leach
capacity to support the higher throughput and increase of
operability. The capital costs of this mill expansion are estimated
to be approximately $50 million, with
spending evenly split between 2019 and 2020. The mining rate at
Fekola will also be increased, along with additional mining
equipment to accelerate the supply of higher-grade ore to the
expanded processing facilities. Initial capital costs for the fleet
expansion are estimated at $85
million with $36 million now
expected to be incurred in 2019 and the balance of $49 million by the end of 2020. Fleet costs in
2020 are expected to be partially financed by approximately
$40 million of equipment loans.
Fekola pit design, schedule, and costs will be refined in late
2019 and early 2020, when updated resource and geotechnical models
are available.
Construction has commenced in October
2019 and is expected be completed by the end of July 2020. All major long-lead equipment has been
ordered. Detailed engineering and design activities are progressing
well and are expected to be completed in November 2019.
Based on Fekola's strong year-to-date performance, the Company
has revised Fekola's production guidance range higher to be between
445,000 to 455,000 ounces of gold (original guidance range was
between 420,000 to 430,000 ounces), while maintaining Fekola's
initial cost guidance of cash operating costs of between
$370 and $410 per ounce sold and AISC of between
$625 and $665 per ounce sold.
Based on B2Gold's current projections, gold production at the
Fekola Mine in 2020 is projected to be approximately 600,000 ounces
of gold, primarily due to the addition of a larger mining fleet at
Fekola and the optimization of the mining sequence early in 2020,
prior to completion of the mill expansion, providing access to
higher grade portions of the deposit earlier on in the
sequence.
Mineral Resources which are not Mineral Reserves do not have
demonstrated economic viability. The Expansion Study PEA is
preliminary in nature and includes Indicated (81%) and Inferred
Mineral Resources (19%). Inferred Mineral Resources are considered
too speculative geologically to have economic considerations
applied to them that would enable them to be categorized as Mineral
Reserves. Consequently, there is no certainty that the Expansion
Study PEA will be realized.
Fekola Solar Plant
In the second quarter of 2019, the Company completed a
preliminary study to evaluate the technical and economic viability
of adding a solar plant to the Fekola mine site. The results of
that study indicated that the project was technically and
economically viable and that a plant of approximately 30 megawatts
of solar generating capacity with a significant battery storage
component would provide the best economic result. A second study
has now been completed that has established the detailed capital
and operating cost analysis for the project. Results indicated that
a solar plant can provide significant operating cost reductions
(estimated to reduce processing costs by approximately 7%), and the
project was approved by the B2Gold Board of Directors in the second
quarter of 2019. Detailed engineering is well advanced, purchase
orders for key equipment packages are being placed and contractors
for site earthworks have been selected.
The Fekola Solar Plant will be one of the largest off-grid
hybrid solar/heavy fuel oil ("HFO") plants in the world. It is
expected that it will allow for three HFO generators to be shut
down during daylight hours which will save about 13.1 million
litres of HFO per year, at a capital cost of approximately
$38 million, of which $17 million is now expected to be incurred in
2019, with the balance in 2020.
The Fekola Solar Plant is scheduled for completion in
August 2020 and has a four-year
payback.
Ongoing Fekola Exploration
On September 16, 2019, the Company
announced positive drill results from the Mamba zone which is
located within the Anaconda area approximately 20 kilometres from
the Fekola Mine, as well as positive infill drill results from the
Fekola Mineral Resource area and step out results north of the
Fekola resource. Highlights included: extending the shallow,
high-grade saprolite mineralized zone at Mamba by approximately 600
metres to more than one kilometre of strike length; discovery of a
new wide good grade sulphide zone directly beneath the Mamba
saprolite zone (the sulphide zone is open down plunge to the south,
indicating the potential for Fekola-type gold deposits); infill
drilling at the Fekola deposit completed, and expected upgrade of
the Inferred Mineral Resource (19%) to Indicated status by the
fourth quarter of 2019.
Drilling is ongoing at Fekola, including a reconnaissance
program at the Cardinal zone, less than one kilometre west of the
Fekola Mine open pit. Drilling at the Anaconda area, to test
the extension of the saprolite zones and further explore the
sulphide mineralization below, is scheduled to recommence in the
fourth quarter of 2019. In addition, step out drilling continues to
extend the Fekola deposit further to the north, which remains open.
A total of 30,000 metres of drilling is planned for completion
before year-end and the Company expects to continue with an
aggressive exploration program in 2020.
Masbate Gold Mine - the
Philippines
The Masbate Mine in the
Philippines continued its strong operational performance
through the third quarter of 2019, producing 51,546 ounces of gold
(Q3 2018 - 57,542 ounces), 4% (2,147 ounces) above budget.
Throughout the year, mining activity was mainly conducted within
the Main Vein Pit. Gold production was above budget largely due to
higher-than-planned high-grade ore tonnage mined from the Main Vein
Pit, including ore tonnage from backfilled areas (resulting in
higher-than-expected head grade). Compared to the prior-year
quarter, gold production was lower by 10% (5,996 ounces), as the
prior-year quarter benefitted from higher grade from the lower
levels of the Colorado Pit which was completed on August 19, 2018.
For the third quarter 2019, the average grade processed was 1.09
g/t compared to budget of 0.92 g/t and 1.39 g/t in the third
quarter of 2018. Mill throughput and recoveries were 2,037,969
tonnes (compared to budget of 2,032,585 tonnes and 1,762,124 tonnes
in the third quarter of 2018) and 72.4% recovery (compared to
budget of 82.1% and 73.0% in the third quarter of 2018),
respectively.
Approval for the Montana Extension Pit continues to advance. The
community review process was successfully concluded, the
Environment Compliance Certificate has been received, and the
supporting infrastructure is in place. The approval process
continues to advance and when completed the Company will commence
in the Montana Extension Pit, anticipated to be either late in the
fourth quarter of 2019 or in early 2020.
Masbate's third quarter cash operating costs were $622 per ounce produced ($588 per ounce sold) (Q3 2018 – $528 per ounce produced), well-below budget by
$51 per ounce (8%). The favourable
budget variance was driven by the above-budget gold production
together with lower-than-budgeted mining costs. Masbate's AISC for
the quarter were $833 per ounce sold
(Q3 2018 - $639 per ounce),
well-below budget by $57 per ounce
(6%), mainly due to higher-than-budgeted gold ounces sold and
lower-than-budgeted mining costs.
During the first nine months of 2019, the Masbate Mine produced
a year-to-date record of 166,599 ounces of gold, above budget by 9%
(13,224 ounces) and 1% (1,656 ounces) higher than the first nine
months of 2018.
Masbate's cash costs remained significantly below budget in the
first nine months of 2019. Cash operating costs were $564 per ounce produced ($567 per ounce sold) (first nine months of 2018 -
$534 per ounce produced),
$94 per ounce (14%) below budget, and
AISC were $773 per ounce (first nine
months of 2018 - $708 per ounce),
$132 per ounce (15%) below budget.
Capital expenditures for the third quarter of 2019 totaled
$5 million mainly consisting of
$1 million for mobile equipment
purchases and rebuilds and $1 million
for pre-stripping. For the nine months ended September 30, 2019, capital expenditures totaled
$21 million, including Masbate
processing plant upgrade costs of $6
million, mobile equipment purchases and rebuilds of
$5 million, pre-stripping of
$3 million and $2 million for the tailings storage facility
construction.
The Masbate expansion project for the upgrade of the processing
plant to 8.0 Mtpa was completed in early 2019. With the expansion
now fully commissioned and online, Masbate's annual gold production
is projected to average approximately 200,000 ounces per year
during the mining phase and above 100,000 ounces per year when the
low-grade stockpiles are processed in the subsequent period after
open-pit mining activities have ceased.
For full-year 2019, gold production from the Masbate Mine is
expected to be near the top end of its production guidance range of
between 200,000 and 210,000 ounces of gold. Cash operating costs
are expected to be at or below the low end of the guidance range of
between $625 and $665 per ounce sold and AISC are also expected to
be at or below the low end of the guidance range of between
$860 and $900 per ounce sold.
Otjikoto Gold Mine - Namibia
The Otjikoto Mine in Namibia
also had a strong third quarter with gold production of 49,411
ounces, above budget by 6% (2,683 ounces) and 17% (7,008 ounces)
higher compared to the prior-year quarter, mainly due to
higher-than-expected ore grade and tonnage from Phase 2 of the
Wolfshag Pit (as higher grade ore production resumed from the
Wolfshag Pit in the current quarter). The Otjikoto Mine continued
its remarkable safety performance, extending the number of days
without an LTI to 552 days (4.6 million man-hours) at the end of
the third quarter of 2019.
For the third quarter of 2019, the average grade processed was
1.84 g/t, compared to budget of 1.73 g/t and 1.54 g/t in the third
quarter of 2018. Mill throughput was 843,386 tonnes (compared to
budget of 856,986 tonnes and 870,125 tonnes in the third quarter of
2018) with mill recoveries remaining high and averaging 98.8%
(compared to budget of 98.0% and comparable to the third quarter of
2018).
For the third quarter of 2019, Otjikoto's cash operating costs
were $394 per ounce produced
($431 per ounce sold), significantly
below budget by $125 per ounce (24%)
and the prior-year quarter by $76 per
ounce (16%). Cash operating costs were lower-than-budget as a
result of favorable fuel/reagent prices, a weaker Namibian dollar
(relative to the United States
dollar) and above budgeted gold production. Otjikoto's AISC for the
quarter were $743 per ounce sold,
below budget by $41 per ounce (5%)
and the prior-year quarter by $65 per
ounce (10%).
Year-to-date, gold production at the Otjikoto Mine was 119,544
ounces of gold (first nine months of 2018 - 122,580 ounces), above
budget by 4% (5,003 ounces).
Year-to-date, Otjikoto's cash operating costs were $501 per ounce produced ($501 per ounce sold) (year-to-date 2018 -
$514 per ounce produced),
significantly below budget by $74 per
ounce (13%). Otjikoto's AISC were $895 per ounce sold (first nine months of 2018 -
$754 per ounce sold), significantly
below budget by $124 per ounce (12%).
Otjikoto's AISC were lower-than-budget as a result of the
lower-than-budgeted cash operating costs, higher gold ounces sold
compared to budget and sustaining capital expenditures that were
$6 million lower-than-budgeted
(relating mainly to lower capitalized pre-stripping and which is
expected to be an overall capital expenditure saving versus budget
for the year).
Capital expenditures in the third quarter of 2019 totaled
$10 million, mainly consisting of
$7 million for pre-stripping and
$2 million in mobile equipment
rebuilds and replacements. Capital expenditures for the nine months
ended September 30, 2019, totaled
$34 million, mainly consisting of
$25 million for pre-stripping and
$8 million in mobile equipment
rebuilds and replacements.
For full-year 2019, the Otjikoto Mine is expected to produce
between 165,000 and 175,000 ounces of gold. Cash operating costs
are expected to be at or below the low end of the guidance range of
between $520 and $560 per ounce and AISC are also expected to be
at or below the low end of the guidance range of between
$905 and $945 per ounce.
Discontinued Operations
El Limon Gold Mine -
Nicaragua
In the third quarter of 2019, El Limon produced 20,503 ounces of
gold, well-above budget by 22% (3,665 ounces), as high-grade ore
production from the new Limon Central Pit comes fully online, and
significantly above the prior-year quarter by 57% (7,405 ounces)
which had been impacted by national political unrest in the country
in 2018. For the third quarter of 2019, the average grade processed
was 5.72 g/t compared to budget of 4.65 g/t and 3.56 g/t in the
third quarter of 2018.
El Limon's third quarter 2019 cash operating costs were
$636 per ounce produced ($664 per ounce sold), in-line with budget, and
AISC were $945 per ounce, above
budget by $122 per ounce (15%),
reflecting higher-than-budgeted underground metres developed at
Veta Nueva.
Year-to-date, El Limon produced 44,192 ounces of gold, well
above budget by 9% (3,593 ounces) and 17% (6,456 ounces) higher
than the first nine months of 2018.
For the first nine months of 2019, El Limon's cash operating
costs were $786 per ounce produced
($821 per ounce sold), below budget
by $26 per ounce (3%), and AISC were
$1,251 per ounce, above budget by
$103 per ounce (9%).
For full-year 2019, the Company's share of production from El
Limon is now expected to be between 50,000 and 55,000 ounces of
gold (the forecast includes the Company's approximate 30% indirect
share of El Limon's forecast production for the stub period
October 15, 2019, to December 31, 2019, following the completion of
the Calibre Transaction), at cash operating costs of between
$720 and $760 per ounce and AISC of between $1,005 and $1,045
per ounce.
La Libertad Gold Mine -
Nicaragua
In the third quarter of 2019, La Libertad Mine produced 24,419
ounces of gold, 16% (3,354 ounces) above budget and 11% (2,424
ounces) higher compared to the prior-year quarter. The higher gold
production was largely due to higher-than-planned ore grade and
tonnage from the San Diego and
Mojon East pits and higher-than-planned ore tonnage from the Jabali
Underground mine. The head grade for the quarter was 1.39 g/t
versus a budget of 1.22 g/t and 1.29 g/t in the prior-year
quarter.
During the second quarter of 2019, the Company received the
mining permit for the new Jabali Antenna open-pit and production
started from the pit in September
2019 (as budgeted).
La Libertad Mine's third quarter cash operating costs were
$957 per ounce produced ($973 per ounce sold), $29 per ounce (3%) below budget, and AISC were
$1,166 per ounce sold, $48 per ounce (4%) below budget.
Year-to-date, La Libertad produced 68,177 ounces of gold, above
budget by 4% (2,931 ounces) and 9% (5,407 ounces) higher than the
first nine months of 2018.
For the first nine months of 2019, La Libertad's cash operating
costs were $1,056 per ounce produced
($1,077 per ounce sold), $77 per ounce (8%) above budget, and AISC were
$1,415 per ounce sold, $27 per ounce (2%) above budget.
For full-year 2019, the Company's share of production from La
Libertad is now expected to be between 75,000 and 80,000 ounces of
gold (the forecast includes the Company's approximate 30% indirect
share of La Libertad's forecast production for the stub period
October 15, 2019, to December 31, 2019, following the completion of
the Calibre Transaction), at cash operating costs of between
$840 and $880 per ounce and AISC of between $1,150 and $1,190
per ounce.
Development
Gramalote Development Project - Colombia
On September 16, 2019, B2Gold
announced that the Company and AngloGold Ashanti Limited
("AngloGold") had agreed in principle to terms relating to the
parties' respective ownership percentages and future management of
the joint venture on the Gramalote Gold Project in Colombia. The companies have agreed that
B2Gold will sole fund the next $13.9
million of expenditures on the Gramalote Project (the "Sole
Fund Amount"), following which B2Gold will hold a 50% ownership
interest in the joint venture (B2Gold currently holds a 48.3%
interest). Under the amended terms, AngloGold and B2Gold will each
hold a 50% interest and B2Gold will start an immediate transition
to become manager of the Gramalote joint venture by the end of
2019, conditional upon the parties entering into an amended and
restated shareholders agreement. The parties will continue to have
equal representation on the joint venture management committee.
Following the expenditure of the Sole Fund Amount, each joint
venture partner will fund its share of expenditures pro rata.
B2Gold and AngloGold have also agreed in principle on a budget
for the feasibility study on the Gramalote Project of up to
$40 million for fiscal 2020. A final
2020 budget is expected to be agreed by the end of November 2019. In addition, B2Gold and AngloGold
have agreed to a $6 million budget
for the balance of 2019 for total budgeted costs to the end of 2020
of $46 million. Of this amount, and
in consideration of the Sole Fund Amount discussed above, B2Gold
anticipates funding $6 million in the
fourth quarter of 2019 and $24
million in 2020. Collectively, these budgets will fund
42,500 metres of infill drilling and 7,645 metres of geotechnical
drilling for site infrastructure. The Company currently expects to
complete all drilling by the end of May
2020. In addition, the budget will fund feasibility work
including an updated Mineral Resource estimate, detailed mine
planning, additional environmental studies, metallurgical test
work, engineering and detailed economic analysis.
B2Gold, as manager, plans to continue the feasibility work into
2020 with the goal of completing a final feasibility study by
December 31, 2020. Due to the
extensive testing programs that have been completed and the high
level of engineering performed in 2017 for an internal
pre-feasibility study, the engineering work remaining to get to
final feasibility is not extensive. The main work program for
feasibility is infill drilling to confirm and upgrade the Inferred
Mineral Resources to Indicated status.
Summary and Outlook
Based on a strong third quarter and year-to-date gold
production, the Company remains on track to meet its 2019 projected
consolidated gold production of between 935,000 and 975,000 ounces.
In 2019, the Company completed infill drilling of the Fekola
deposit, converting Mineral Resources from Inferred to Indicated.
Additional exploration drilling has continued to expand the Fekola
mineralization to the north and remains open. Exploration drilling
also continues on the highly prospective Anaconda zones, 20
kilometres north of Fekola, and the Cardinal zone, west of
Fekola.
In the third quarter of 2019, the Company announced that they
had reached an agreement in principle relating to the Gramalote
Project in Colombia which will see B2Gold increase its
interest to 50%, and assume the position of Manager of the
Gramalote Joint Venture Project effective January 1, 2020. As part of that agreement, the
companies agreed to a budget of up to $40
million for 2020 to complete significant resource infill
drilling and complete a feasibility study for the project.
Gramalote has the potential to become a large open-pit gold
mine.
On October 15, 2019, the Company
completed a restructuring of its interests in its Nicaraguan Assets
by closing a deal with Calibre, whereby Calibre acquired the La
Libertad and El Limon mines in return for gross consideration
totaling $100 million (plus
additional working capital adjustments of approximately
$20 million) of which $40 million was received in Calibre shares.
Subsequent to the transaction, the Company still retains an
approximate 30% indirect interest in the Nicaraguan Assets and will
continue to share in any exploration success or economic upside
realized for those operations.
The Company is on schedule to realize a significant increase in
gold production from the Fekola Mine in 2020 (approximately 600,000
ounces) based on the addition of a larger mining fleet and the
optimization of the mining sequence. In addition, B2Gold's
construction team is on schedule to complete the Fekola mill
expansion in the third quarter of 2020, which will significantly
increase mill throughput, yielding projected annual production
averaging 550,000 ounces of gold over the next five years based on
current assumptions.
In addition to these strategic actions and evaluations, B2Gold
has also continued to execute on its financial strategy of using
debt and operating cash flow from existing operations rather than
equity to fund the construction of the Fekola and Otjikoto mines.
Now that Fekola is nearing the end of its second full year of
commercial operations, the Company has repaid a further
$100 million of the balance
outstanding on its RCF in the first three quarters of 2019 and
expects to repay a further $100
million of the RCF later in the fourth quarter of 2019,
which would leave the Company with $200
million outstanding under the RCF by year-end, well below
industry averages. Total debt outstanding at December 31, 2019, including equipment loans and
leases, is forecast to be approximately $260
million, a reduction in the year of $220 million from opening total debt of
approximately $480 million. Looking
forward through the balance of 2019 and beyond, the Company will
continue to execute on its strategic objectives. B2Gold plans to
continue to maximize cash flows; maintain a strong financial
position by continuing the impressive operational and financial
performance from its existing mines; continue to reduce debt;
expand the Fekola Mine throughput and annual gold production;
pursue additional internal growth through further exploration,
development and expansion of existing projects; and pursuit of
high-quality exploration projects alone or in joint ventures.
In conjunction with these initiatives, the Company has also
reinforced its commitment to maximizing shareholder value by
declaring its first quarterly dividend, for the fourth quarter of
2019, and announcing its intention to maintain the payment of a
quarterly dividend going forward. Payment of a dividend is the
culmination of the Company's rapid and successful growth from an
exploration Company to a successful, globally-diverse producer and
marks the achievement of another of the Company's strategic
objectives which was to become a sustainable, low-cost gold
producer that utilizes cash flow to continue growth and pay a
dividend to its shareholders.
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.
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.
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.
Third Quarter and First Nine Months of 2019 Financial
Results - Conference Call / Webcast Details
B2Gold executives will host a conference call to discuss the
results on Wednesday, November 6, 2019, 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 here:
https://www.investornetwork.com/event/presentation/54019. A
playback version 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 324229).
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
|
The Toronto Stock Exchange and 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 our Annual Information Form,
dated March 19, 2019 for a discussion
of our ownership interest in the mines B2Gold operates. In respect
of La Libertad and El Limon, production is presented on a 100%
basis for the period to October 15,
2019 and on a 30% basis (to reflect B2Gold's approximate
ownership interest in Calibre) thereafter.
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 or 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: the potential payment of future dividends, including
the timing and amount of any such dividends; B2Gold remaining well
positioned for continued strong operational and financial
performance for the full-year of 2019; projected consolidated gold
production of between 935,000 and 975,000 ounces in 2019 and that
the Company expects to meet the approximate mid-point of its
guidance in 2019 with cash operating costs forecast to be at
the lower end of the Company's guidance range and AISC to be within
the Company's guidance range; the anticipated repayment of a
further $100 million of the
outstanding RCF balance in the fourth quarter of 2019; the
projected production at Fekola in 2020; the results of the Fekola
PEA; the completion of the mill expansion at Fekola and the results
thereof; the Fekola expansion being expected to increase
life-of-mine to 2030 and project pre-tax net present value,
increase processing throughput and produce more gold over a longer
life with more robust economics and higher average gold production,
revenues and cash flows than the previous life-of-mine and the
timing and cost of such expansion; the anticipated cost of the
fleet expansion at Fekola; the anticipated cost, timing and results
for the addition of a solar plant to the Fekola Mine; the Masbate
expansion project resulting in production at the Masbate
Mine being projected to average approximately 200,000 ounces per
year during the mining phase and above 100,000 ounces per year when
the low-grade stockpiles are processed at the end of the open-pit
mine life; the anticipated timing for the issuance of a permit for
the Montana Pit Extension at the
Masbate Mine; anticipated changes in the
ownership and management of Gramalote; the completion and results
of a feasibility study at Gramalote and B2Gold
remaining focused on continuing to reduce overall debt levels,
expand the Fekola Mine throughput and annual gold production,
pursue additional internal growth through further exploration,
development and expansion of existing projects, and pursuit of
greenfield exploration projects alone or in joint
ventures. 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; changes in
tax laws; 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 and the
ramifications thereof; environmental regulations or hazards and
compliance with complex regulations associated with mining
activities; climate change and climate change regulations; 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 or resource nationalization
generally; 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; 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 outcome of the ongoing tax assessment
by the Colombian Tax Office (DIAN) in respect of the Gramalote
property 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, and
sanctions or other similar measures; social media and B2Gold's
reputation; risks affecting Calibre having an impact on the value
of the Company's investment in Calibre; 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 of such 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 have not historically been permitted to be disclosed in SEC
filings by U.S. companies subject to Industry Guide 7. 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 "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. Further, while NI 43-101 permits
companies to disclose economic projections contained in preliminary
economic assessments and pre-feasibility studies, which are not
based on "reserves", U.S. companies subject to Industry Guide 7
have not generally been permitted to disclose economic projections
for a mineral property in their SEC filings prior to the
establishment of "reserves." 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, 2019
|
|
For the
three
months ended
Sept. 30, 2018
|
|
For the
nine
months ended
Sept. 30, 2019
|
|
For the
nine
months ended
Sept. 30, 2018
|
|
|
|
|
|
|
|
|
|
Gold
revenue
|
|
$
|
310,783
|
|
$
|
280,044
|
|
$
|
841,978
|
|
$
|
820,514
|
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
|
|
|
|
|
|
|
Production costs
|
|
(90,526)
|
|
(99,566)
|
|
(278,676)
|
|
(268,100)
|
Depreciation and depletion
|
|
(65,977)
|
|
(69,736)
|
|
(183,589)
|
|
(188,986)
|
Royalties and production taxes
|
|
(22,034)
|
|
(18,771)
|
|
(57,540)
|
|
(55,144)
|
Total cost of
sales
|
|
(178,537)
|
|
(188,073)
|
|
(519,805)
|
|
(512,230)
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
132,246
|
|
91,971
|
|
322,173
|
|
308,284
|
|
|
|
|
|
|
|
|
|
General and
administrative
|
|
(10,551)
|
|
(11,181)
|
|
(36,999)
|
|
(31,608)
|
Share-based
payments
|
|
(3,414)
|
|
(7,920)
|
|
(13,450)
|
|
(13,763)
|
Impairment of
long-lived assets
|
|
—
|
|
—
|
|
—
|
|
(18,186)
|
Write-down of mineral
property interests
|
|
(972)
|
|
(499)
|
|
(2,324)
|
|
(499)
|
(Provision for)
recovery of non-recoverable input taxes
|
|
(185)
|
|
1,459
|
|
370
|
|
1,068
|
Community
relations
|
|
(1,277)
|
|
(1,250)
|
|
(2,420)
|
|
(2,699)
|
Foreign exchange
gains
|
|
2,274
|
|
2,724
|
|
3,524
|
|
4,521
|
Other
|
|
(2,495)
|
|
1,019
|
|
(2,533)
|
|
(971)
|
Operating
income
|
|
115,626
|
|
76,323
|
|
268,341
|
|
246,147
|
|
|
|
|
|
|
|
|
|
Unrealized (loss)
gain on fair value of convertible notes
|
|
—
|
|
(1,441)
|
|
—
|
|
10,651
|
Interest and
financing expense
|
|
(7,123)
|
|
(7,316)
|
|
(21,640)
|
|
(23,619)
|
(Loss) gain on
derivative instruments
|
|
(4,156)
|
|
4,001
|
|
(824)
|
|
12,120
|
Other
|
|
(61)
|
|
600
|
|
(564)
|
|
275
|
Income from
continuing operations before taxes
|
|
104,286
|
|
72,167
|
|
245,313
|
|
245,574
|
Current income tax,
withholding and other taxes
|
|
(34,681)
|
|
(25,065)
|
|
(84,373)
|
|
(85,064)
|
Deferred income tax
expense
|
|
(19,684)
|
|
(7,779)
|
|
(30,783)
|
|
(27,428)
|
Net income from
continuing operations
|
|
49,921
|
|
39,323
|
|
130,157
|
|
133,082
|
Income (loss) from
discontinued operations
|
|
15,662
|
|
(23,287)
|
|
3,271
|
|
(38,285)
|
Net income for the
period
|
|
$
|
65,583
|
|
$
|
16,036
|
|
$
|
133,428
|
|
$
|
94,797
|
|
|
|
|
|
|
|
|
|
Attributable
to:
|
|
|
|
|
|
|
|
|
Shareholders of the Company
|
|
$
|
55,769
|
|
$
|
10,598
|
|
$
|
115,968
|
|
$
|
87,886
|
Non-controlling interests
|
|
9,814
|
|
5,438
|
|
17,460
|
|
6,911
|
Net income for the
period
|
|
$
|
65,583
|
|
$
|
16,036
|
|
$
|
133,428
|
|
$
|
94,797
|
|
|
|
|
|
|
|
|
|
Earnings per share
from continuing operations
(attributable to
shareholders of the Company)
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.04
|
|
$
|
0.03
|
|
$
|
0.11
|
|
$
|
0.13
|
Diluted
|
|
$
|
0.04
|
|
$
|
0.03
|
|
$
|
0.11
|
|
$
|
0.11
|
|
|
|
|
|
|
|
|
|
Earnings per
share
(attributable to
shareholders of the Company)
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.05
|
|
$
|
0.01
|
|
$
|
0.11
|
|
$
|
0.09
|
Diluted
|
|
$
|
0.05
|
|
$
|
0.01
|
|
$
|
0.11
|
|
$
|
0.07
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding
(in
thousands)
|
|
|
|
|
|
|
|
|
Basic
|
|
1,019,307
|
|
988,795
|
|
1,009,753
|
|
985,226
|
Diluted
|
|
1,031,301
|
|
999,347
|
|
1,018,606
|
|
1,063,901
|
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, 2019
|
|
For the
three
months ended
Sept. 30, 2018
|
|
For the
nine
months ended
Sept. 30, 2019
|
|
For the
nine
months ended
Sept. 30, 2018
|
Operating
activities
|
|
|
|
|
|
|
|
|
Net income from
continuing operations for the period
|
|
$
|
49,921
|
|
$
|
39,323
|
|
$
|
130,157
|
|
$
|
133,082
|
Mine restoration
provisions settled
|
|
—
|
|
—
|
|
(124)
|
|
—
|
Non-cash charges,
net
|
|
101,229
|
|
76,097
|
|
220,519
|
|
204,560
|
Changes in non-cash
working capital
|
|
(14,033)
|
|
17,244
|
|
(44,772)
|
|
16,057
|
Changes in long-term
value added tax receivables
|
|
408
|
|
4,020
|
|
325
|
|
1,274
|
Cash provided by
operating activities of continuing operations
|
|
137,525
|
|
136,684
|
|
306,105
|
|
354,973
|
Cash provided by
operating activities of discontinued operations
|
|
30,309
|
|
6,552
|
|
40,963
|
|
21,750
|
Cash provided by
operating activities
|
|
167,834
|
|
143,236
|
|
347,068
|
|
376,723
|
|
|
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
|
|
|
|
Revolving credit
facility, drawdowns net of transaction costs
|
|
—
|
|
200,000
|
|
(5,574)
|
|
225,000
|
Repayment of
revolving credit facility
|
|
(75,000)
|
|
(25,000)
|
|
(100,000)
|
|
(175,000)
|
Equipment loan
facilities, drawdowns net of transaction costs
|
|
—
|
|
—
|
|
3,463
|
|
28,848
|
Repayment of
equipment loan facilities
|
|
(5,854)
|
|
(7,291)
|
|
(18,233)
|
|
(20,463)
|
Interest and
commitment fees paid
|
|
(5,897)
|
|
(5,291)
|
|
(18,166)
|
|
(20,163)
|
Common shares issued
for cash on exercise of stock options
|
|
35,443
|
|
5,550
|
|
63,613
|
|
15,457
|
Principal payments on
lease arrangements
|
|
(803)
|
|
—
|
|
(2,304)
|
|
—
|
Restricted cash
movement
|
|
(270)
|
|
—
|
|
(1,524)
|
|
(1,379)
|
Other
|
|
—
|
|
(169)
|
|
—
|
|
(389)
|
Cash (used)
provided by financing activities of continuing
operations
|
|
(52,381)
|
|
167,799
|
|
(78,725)
|
|
45,911
|
Cash used by
financing activities of discontinued operations
|
|
(42)
|
|
(181)
|
|
(324)
|
|
(801)
|
Cash (used)
provided by financing activities
|
|
(52,423)
|
|
167,618
|
|
(79,049)
|
|
45,110
|
|
|
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
|
|
|
|
Expenditures on
mining interests:
|
|
|
|
|
|
|
|
|
Fekola
Mine
|
|
(30,604)
|
|
(17,128)
|
|
(64,717)
|
|
(53,537)
|
Masbate
Mine
|
|
(4,725)
|
|
(12,096)
|
|
(20,689)
|
|
(33,493)
|
Otjikoto
Mine
|
|
(9,949)
|
|
(11,747)
|
|
(34,452)
|
|
(41,379)
|
Gramalote
Project
|
|
(1,245)
|
|
(1,563)
|
|
(3,047)
|
|
(6,040)
|
Other exploration and
development
|
|
(11,022)
|
|
(11,135)
|
|
(30,206)
|
|
(37,230)
|
Other
|
|
(21)
|
|
808
|
|
381
|
|
738
|
Cash used by
investing activities of continuing operations
|
|
(57,566)
|
|
(52,861)
|
|
(152,730)
|
|
(170,941)
|
Cash used by
investing activities of discontinued operations
|
|
(15,599)
|
|
(9,637)
|
|
(52,290)
|
|
(42,150)
|
Cash used by
investing activities
|
|
(73,165)
|
|
(62,498)
|
|
(205,020)
|
|
(213,091)
|
|
|
|
|
|
|
|
|
|
Increase in cash
and cash equivalents
|
|
42,246
|
|
248,356
|
|
62,999
|
|
208,742
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
(848)
|
|
(467)
|
|
(587)
|
|
(1,369)
|
Cash and cash
equivalents, beginning of period
|
|
123,766
|
|
106,952
|
|
102,752
|
|
147,468
|
Less cash
associated with discontinued operations, end of
period
|
|
(18,751)
|
|
(4,269)
|
|
(18,751)
|
|
(4,269)
|
Cash and cash
equivalents, end of period
|
|
$
|
146,413
|
|
$
|
350,572
|
|
$
|
146,413
|
|
$
|
350,572
|
|
|
|
|
|
|
|
|
|
B2GOLD CORP.
CONDENSED INTERIM CONSOLIDATED BALANCE
SHEETS
(Expressed in thousands of United States dollars)
(Unaudited)
|
|
As at September
30,
2019
|
|
As at December
31,
2018
|
Assets
|
|
|
|
|
Current
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
146,413
|
|
$
|
102,752
|
Accounts receivable,
prepaids and other
|
|
17,650
|
|
12,651
|
Value-added and other
tax receivables
|
|
10,242
|
|
13,657
|
Inventories
|
|
204,568
|
|
233,971
|
Assets classified as
held for sale
|
|
181,719
|
|
—
|
|
|
560,592
|
|
363,031
|
|
|
|
|
|
Long-term
investments
|
|
5,390
|
|
4,155
|
Value-added tax
receivables
|
|
22,987
|
|
22,185
|
Mining
interests
|
|
|
|
|
Owned by
subsidiaries
|
|
1,933,207
|
|
2,035,097
|
Investments in joint
ventures
|
|
75,125
|
|
72,078
|
Other
assets
|
|
44,126
|
|
40,351
|
Deferred income
taxes
|
|
—
|
|
10,907
|
|
|
$
|
2,641,427
|
|
$
|
2,547,804
|
Liabilities
|
|
|
|
|
Current
|
|
|
|
|
Accounts payable and
accrued liabilities
|
|
$
|
59,662
|
|
$
|
80,318
|
Current income and
other taxes payable
|
|
53,964
|
|
66,904
|
Current portion of
long-term debt
|
|
25,835
|
|
25,008
|
Current portion of
prepaid sales
|
|
—
|
|
30,000
|
Current portion of
mine restoration provisions
|
|
—
|
|
3,170
|
Other current
liabilities
|
|
3,584
|
|
1,850
|
Liabilities associated
with assets held for sale
|
|
90,934
|
|
—
|
|
|
232,359
|
|
207,250
|
|
|
|
|
|
Long-term
debt
|
|
340,358
|
|
454,527
|
Mine restoration
provisions
|
|
76,318
|
|
114,051
|
Deferred income
taxes
|
|
115,956
|
|
103,384
|
Employee benefits
obligation
|
|
4,014
|
|
12,063
|
Other long-term
liabilities
|
|
5,243
|
|
3,676
|
|
|
775,868
|
|
894,951
|
Equity
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
Share
capital
|
|
|
|
|
Issued: 1,025,751,636 common
shares (Dec 31, 2018 – 994,621,917)
|
|
2,325,188
|
|
2,234,050
|
Contributed
surplus
|
|
57,401
|
|
70,889
|
Accumulated other
comprehensive loss
|
|
(144,918)
|
|
(146,153)
|
Deficit
|
|
(429,268)
|
|
(547,839)
|
|
|
1,808,403
|
|
1,610,947
|
Non-controlling
interests
|
|
57,156
|
|
41,906
|
|
|
1,865,559
|
|
1,652,853
|
|
|
$
|
2,641,427
|
|
$
|
2,547,804
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/b2gold-corp-announces-strong-third-quarter-and-year-to-date-2019-results-and-declares-its-first-quarterly-dividend-300952456.html
SOURCE B2Gold Corp.