Caledonia Mining Corporation Plc (NYSE AMERICAN: CMCL; AIM: CMCL)
("Caledonia" or the "Company") announces its operating and
financial results for the quarter and the six months ended June 30,
2021 (the "Quarter" and "First Half" respectively). Further
information on the financial and operating results for the Quarter
and First Half can be found in the management discussion and
analysis ("MD&A") and the un-audited financial statements which
are available on the Company's website, and which have been filed
on SEDAR.
Financial Highlights for the
Quarter
- Gross revenues of $30.0 million, a
31 per cent increase on the $22.9 million achieved in the second
quarter of 2020 ("Q2 2020").
- Gross profit of $13.9 million, a 51
per cent increase on the $9.2 million in Q2 2020.
- EBITDA (excluding asset
impairments, net foreign exchange gains and losses and export
incentives) of $14.0 million, a 103 per cent increase on the $6.9
million in Q2 2020.
- On-mine cost of $715 per ounce (Q2
2020, $811 per ounce).
- All-in sustaining
cost (“AISC”)1 excluding export incentives of $933 per ounce
(Q2 2020, $1,075 per ounce).
- Basic IFRS earnings per share
("EPS") of 21.1 cents (Q2 2020, 43.1 cents).
- Adjusted EPS of 62.6 cents (Q2
2020, 36.8 cents).
- Net cash from operating activities
of $12.7 million (Q2 2020, $4.0 million).
- Net cash and cash equivalents of
$16.7 million (Q2 2020, $11.6 million).
- Total dividend paid in the Quarter
of 12 cents per share in April; a further dividend at the increased
rate of 13 cents per share was paid in July.
Operating Highlights
- 16,710 ounces of gold produced in
the Quarter, 24 per cent higher than the 13,499 ounces produced in
Q2 2020 and a new production record for a second quarter.
- 29,907 ounces produced in the First
Half, eight per cent higher than the 27,732 ounces produced in the
first half of 2020.
- Over 165,000 tonnes of ore were
mined and milled in the Quarter which is a new production record
for any quarter and reflects the contribution of the Central Shaft
which was commissioned at the end of March 2021 and the build-up
towards the target of 80,000 ounces per annum from 2022
onwards2.
Outlook
- Production in July was 5,995
ounces, which is a further increase in average monthly production
and demonstrates that Blanket is on-track to achieve its production
guidance of 61,000 – 67,000 ounces for 2021.
- On-mine cost guidance for 2021 is
in the range of $740 to $815 per ounce; guidance for AISC is $985
to $1,080 per ounce.
- Further to the Company’s
announcement on 11 December 2020 that it had acquired an option
over the Glen Hume property, Caledonia has decided not to exercise
this option over the Glen Hume property due to disappointing
exploration results. Caledonia will conduct exploration at
Connemara North, the other optioned property in Zimbabwe as
announced on 17 December 2020. Caledonia will consider further
investment opportunities in Zimbabwe and elsewhere.
Caledonia will host an online
presentation and Q&A session open to all investors on 12 of
August 2021 at 16:30 GMT (17:30 British Summer Time; 13.30 New
York; 18:30 European)
The Zoom details for this call are set out
below:
Details:
Please click the link
below to join the
webinar:https://caledoniamining.zoom.us/j/92437639930?pwd=QnhuRE5FTDZYUWl0a05nSmFRREt0dz09Passcode:
717117
Or Telephone:Dial (for
higher quality, dial a number based on your current location):US:
+1 312 626 6799 or +1 346 248 7799 or +1 646 558 8656 or +1 669 900
9128 or +1 253 215 8782 or +1 301 715 8592 Webinar ID: 924 3763
9930Passcode: 717117
International numbers
available: https://caledoniamining.zoom.us/u/adZFCW31rd
Commenting on the announcement, Steve
Curtis, Chief Executive Officer, said:
“Over 165,000 tonnes were milled in the Quarter
which is a new record for Blanket and reflects the contribution of
Central Shaft which is now operational.
“Higher production, lower costs and a higher
gold price resulted in a significant increase in the underlying
profitability of our business with gross profit increasing by 51
per cent compared to the comparable quarter in 2020. Net profit was
adversely affected by the impairment of the Glen Hume exploration
asset following the Board’s decision not to proceed further with
this project because the property does not meet Caledonia’s
strategic requirements in terms of size, grade and width. EBITDA,
excluding foreign exchange gains and losses, export incentives and
asset impairments, increased over 100 per cent from $6.9 million in
Q2 2020 to $14.0 million in the Quarter.
“The increased production meant that cash
generated by operations was almost $15.0 million for the Quarter,
compared to $2.5 million in the preceding quarter and $5.4 million
in the comparable quarter. “Excellent production was
achieved without compromising on safety. During the Quarter Blanket
passed the milestone of achieving two million fatality-free
shifts. “Production in July was slightly less than
6,000 ounces of gold, which demonstrates that Blanket continues to
ramp-up production towards the target rate of 6,700 ounces per
month that is required to achieve the production target of 80,000
ounces per annum from 2022.
"Although COVID-19 had no discernible effect on
production in the Quarter, management has re-introduced strict
access controls to the mine and the mine village to limit the rate
of transmission of the virus. Blanket is also in the process of
vaccinating its workforce and their families.
“The solar project,
which is expected to provide approximately 27 per cent of Blanket’s
average daily electricity usage is now in the procurement phase and
project completion is expected in April 2022.
“In April, the Company paid a further increased
quarterly dividend of 12 cents per share, then in July declared a
quarterly dividend of 13 cents per share, paid at the end of July.
This was the sixth increased quarterly dividend and an 89 per cent
increase from 6.875 cents paid in October 2019.
“This has been a strong Quarter and these
results have left us well placed to achieve our guidance of between
61,000-67,000 ounces for the year. Our immediate strategic focus
continues to be to increase production to 80,000 ounces in 2022,
while undertaking further exploration and development with the
objective of extending the life of mine beyond 2034 thereby
safeguarding and enhancing Blanket’s long-term future. Caledonia
will also evaluate further investment opportunities in Zimbabwe and
elsewhere.”
____________________1 Non-IFRS measures such as
“On-mine cost per ounce”, “All-in sustaining cost per ounce” and
“adjusted EPS” are used throughout this document. Refer to section
10 of the MD&A for a discussion of non-IFRS measures.
2 Refer to the
technical report entitled “Caledonia Mining Corporation Plc NI
43-101 Technical Report on the Blanket Gold Mine, Zimbabwe” dated
May 17, 2021 prepared by Minxcon (Pty) Ltd and filed by the Company
on SEDAR on May 26, 2021. Mr Dana Roets (B Eng (Min.), MBA,
Pr.Eng., FSAIMM, AMMSA), Chief Operating Officer, is the Company's
qualified person as defined by Canada's National Instrument 43-101
and has approved any scientific or technical information contained
in this news release.
For further information please contact:
Caledonia Mining Corporation PlcMark
LearmonthCamilla Horsfall |
Tel: +44 1534 679 802Tel: +44 7817 841793 |
|
|
WH
IrelandAdrian Hadden/James Sinclair-Ford |
Tel: +44 20 7220 1751 |
|
|
BlytheweighTim Blythe/Megan Ray |
Tel: +44 207 138 3204 |
|
|
3PPBPatrick
ChidleyPaul Durham |
Tel: +1 917 991 7701Tel: +1
203 940 2538 |
Note: This announcement contains inside
information which is disclosed in accordance with the Market Abuse
Regulation (EU) No. 596/2014
(“MAR”)
as it forms part of UK domestic law by virtue of the
European Union (Withdrawal) Act 2018 and is disclosed in accordance
with the Company's obligations under Article 17 of
MAR.
Cautionary Note Concerning
Forward-Looking InformationInformation and statements
contained in this news release that are not historical facts are
“forward-looking information” within the meaning of applicable
securities legislation that involve risks and uncertainties
relating, but not limited, to Caledonia’s current expectations,
intentions, plans, and beliefs. Forward-looking information can
often be identified by forward-looking words such as “anticipate”,
“believe”, “expect”, “goal”, “plan”, “target”, “intend”,
“estimate”, “could”, “should”, “may” and “will” or the negative of
these terms or similar words suggesting future outcomes, or other
expectations, beliefs, plans, objectives, assumptions, intentions
or statements about future events or performance. Examples of
forward-looking information in this news release include:
production guidance, estimates of future/targeted production rates,
and our plans and timing regarding further exploration and drilling
and development. This forward-looking information is based, in
part, on assumptions and factors that may change or prove to be
incorrect, thus causing actual results, performance or achievements
to be materially different from those expressed or implied by
forward-looking information. Such factors and assumptions include,
but are not limited to: failure to establish estimated resources
and reserves, the grade and recovery of ore which is mined varying
from estimates, success of future exploration and drilling
programs, reliability of drilling, sampling and assay data,
assumptions regarding the representativeness of mineralization
being inaccurate, success of planned metallurgical test-work,
capital and operating costs varying significantly from estimates,
delays in obtaining or failures to obtain required governmental,
environmental or other project approvals, inflation, changes in
exchange rates, fluctuations in commodity prices, delays in the
development of projects and other factors.
Security holders, potential security holders and
other prospective investors should be aware that these statements
are subject to known and unknown risks, uncertainties and other
factors that could cause actual results to differ materially from
those suggested by the forward-looking statements. Such factors
include, but are not limited to: risks relating to estimates of
mineral reserves and mineral resources proving to be inaccurate,
fluctuations in gold price, risks and hazards associated with the
business of mineral exploration, development and mining, risks
relating to the credit worthiness or financial condition of
suppliers, refiners and other parties with whom the Company does
business; inadequate insurance, or inability to obtain insurance,
to cover these risks and hazards, employee relations; relationships
with and claims by local communities and indigenous populations;
political risk; risks related to natural disasters, terrorism,
civil unrest, public health concerns (including health epidemics or
outbreaks of communicable diseases such as the coronavirus
(COVID-19)); availability and increasing costs associated with
mining inputs and labour; the speculative nature of mineral
exploration and development, including the risks of obtaining or
maintaining necessary licenses and permits, diminishing quantities
or grades of mineral reserves as mining occurs; global financial
condition, the actual results of current exploration activities,
changes to conclusions of economic evaluations, and changes in
project parameters to deal with unanticipated economic or other
factors, risks of increased capital and operating costs,
environmental, safety or regulatory risks, expropriation, the
Company’s title to properties including ownership thereof,
increased competition in the mining industry for properties,
equipment, qualified personnel and their costs, risks relating to
the uncertainty of timing of events including targeted production
rate increase and currency fluctuations. Security holders,
potential security holders and other prospective investors are
cautioned not to place undue reliance on forward-looking
information. By its nature, forward-looking information involves
numerous assumptions, inherent risks and uncertainties, both
general and specific, that contribute to the possibility that the
predictions, forecasts, projections and various future events will
not occur. Caledonia undertakes no obligation to update publicly or
otherwise revise any forward-looking information whether as a
result of new information, future events or other such factors
which affect this information, except as required by law.
This news release is not an offer of the shares
of Caledonia for sale in the United States or elsewhere. This news
release shall not constitute an offer to sell or the solicitation
of an offer to buy, nor shall there be any sale of the shares of
Caledonia, in any province, state or jurisdiction in which such
offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of such province, state
or jurisdiction.
Condensed Unaudited Consolidated Statement of Profit or
Loss and Other Comprehensive Income |
($’000’s) |
3 months endedJune 30 |
6 months endedJune 30 |
|
2020 |
|
2021 |
|
2020 |
|
2021 |
|
Revenue |
22,913 |
|
29,977 |
|
46,515 |
|
55,697 |
|
Royalty |
(1,146 |
) |
(1,503 |
) |
(2,328 |
) |
(2,792 |
) |
Production costs |
(11,451 |
) |
(12,362 |
) |
(22,138 |
) |
(25,219 |
) |
Depreciation |
(1,141 |
) |
(2,199 |
) |
(2,314 |
) |
(3,392 |
) |
Gross profit |
9,175 |
|
13,913 |
|
19,735 |
|
24,294 |
|
Other income |
2,791 |
|
7 |
|
4,709 |
|
30 |
|
Other expenses |
(1,314 |
) |
(3,883 |
) |
(1,522 |
) |
(4,141 |
) |
Administrative expenses |
(1,275 |
) |
(1,745 |
) |
(2,822 |
) |
(3,355 |
) |
Net foreign exchange gain (loss) |
1,486 |
|
(345 |
) |
3,709 |
|
(72 |
) |
Cash-settled share-based payment |
(762 |
) |
(31 |
) |
(946 |
) |
(183 |
) |
Fair value losses on derivative assets |
(113 |
) |
7 |
|
(148 |
) |
(107 |
) |
Results from operating activities |
9,988 |
|
7,923 |
|
22,715 |
|
16,466 |
|
Net finance costs |
(129 |
) |
(223 |
) |
(267 |
) |
(341 |
) |
Profit before tax |
9,859 |
|
7,700 |
|
22,448 |
|
16,125 |
|
Tax expense |
(3,507 |
) |
(3,893 |
) |
(6,417 |
) |
(6,895 |
) |
Profit for the period |
6,352 |
|
3,807 |
|
16,031 |
|
9,230 |
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
Items that are or may be reclassified to profit or
loss |
|
|
|
|
Exchange differences on translation of foreign operations |
293 |
|
383 |
|
(1,058 |
) |
181 |
|
Profit attributable to: |
6,645 |
|
4,190 |
|
14,973 |
|
9,411 |
|
Shareholders of the Company |
5,134 |
|
2,694 |
|
13,374 |
|
7,244 |
|
Non-controlling interests |
1,218 |
|
1,113 |
|
2,657 |
|
1,986 |
|
Profit for the period |
6,352 |
|
3,807 |
|
16,031 |
|
9,230 |
|
Total comprehensive income attributable to: |
|
|
|
|
Shareholders of the Company |
5,427 |
|
3,077 |
|
12,316 |
|
7,425 |
|
Non-controlling interest |
1,218 |
|
1,113 |
|
2,657 |
|
1,986 |
|
Total comprehensive income for the period |
6,645 |
|
4,190 |
|
14,973 |
|
9,411 |
|
Earnings per share (cents) |
|
|
|
|
Basic |
43.1 |
|
21.1 |
|
114.3 |
|
58.4 |
|
Diluted |
43.0 |
|
21.1 |
|
114.1 |
|
58.4 |
|
Adjusted earnings per share (cents) |
|
|
|
|
Basic |
36.8 |
|
62.6 |
|
93.5 |
|
114.2 |
|
Dividends declared per share (cents) |
16.0 |
|
12.0 |
|
23.5 |
|
23.0 |
|
Summarised Consolidated Statements of
Financial Position (unaudited) |
($’000’s) |
As at |
Dec 31 |
Jun 30 |
|
|
2020 |
2021 |
Total non-current assets |
|
133,334 |
140,925 |
Inventories |
|
16,798 |
15,625 |
Prepayments |
|
1,974 |
4,827 |
Trade and other receivables |
|
4,962 |
9,306 |
Income tax receivable |
|
76 |
179 |
Cash and cash equivalents |
|
19,092 |
16,669 |
Derivative financial assets |
|
1,184 |
- |
Assets held for sale |
|
500 |
500 |
Total assets |
|
177,920 |
188,031 |
Total non-current liabilities |
|
9,913 |
11,781 |
Loans and borrowings – short term portion |
|
408 |
178 |
Lease liabilities – short term portion |
|
61 |
104 |
Trade and other payables |
|
8,664 |
8,968 |
Income taxes payable |
|
495 |
1,497 |
Cash-settled share-based payment - short term portion |
|
336 |
1,555 |
Total liabilities |
|
19,877 |
24,083 |
Total equity |
|
158,043 |
163,948 |
Total equity and liabilities |
|
177,920 |
188,039 |
Condensed Consolidated Statement of Cash Flows
(unaudited) ($’000’s) |
|
3 months endedJune 30 |
6 months endedJune 30 |
|
2020 |
|
2021 |
|
2020 |
|
2021 |
|
Cash flows from operating activities |
|
|
|
|
Cash generated from operations |
5,413 |
|
14,987 |
|
16,371 |
|
17,537 |
|
Net interest paid |
(123 |
) |
(124 |
) |
(263 |
) |
(247 |
) |
Tax paid |
(1,315 |
) |
(2,134 |
) |
(2,034 |
) |
(2,598 |
) |
Net cash from operating activities |
3,975 |
|
12,729 |
|
14,074 |
|
14,692 |
|
|
|
|
|
|
Cash flows used in investing activities |
|
|
|
|
Acquisition of property, plant and equipment |
(3,228 |
) |
(7,425 |
) |
(7,921 |
) |
(13,769 |
) |
Acquisition of exploration and evaluation assets |
- |
|
(784 |
) |
|
(974 |
) |
(Acquisition)/Realisation of Gold ETF |
(1,058 |
) |
1,083 |
|
(1,058 |
) |
1,083 |
|
Proceeds from disposal of subsidiary |
- |
|
- |
|
900 |
|
340 |
|
Net cash used in investing activities |
(4,286 |
) |
(7,126 |
) |
(8,079 |
) |
(13,320 |
) |
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
Dividends paid |
(1,012 |
) |
(1,814 |
) |
(1,981 |
) |
(3,506 |
) |
Repayment of term loan facility |
- |
|
(102 |
) |
- |
|
(206 |
) |
Payment of lease liabilities |
(32 |
) |
(33 |
) |
(57 |
) |
(65 |
) |
Receipt from share options exercised |
30 |
|
- |
|
30 |
|
- |
|
Net cash used in financing activities |
(1,014 |
) |
(1,949 |
) |
(2,008 |
) |
(3,777 |
) |
|
|
|
|
|
Net (decrease)/increase in cash and cash
equivalents |
(1,325 |
) |
3,654 |
|
3,987 |
|
(2,404 |
) |
Effect of exchange rate fluctuations on cash held |
(861 |
) |
(12 |
) |
(1,241 |
) |
(18 |
) |
Net cash and cash equivalents at beginning of the period |
13,825 |
|
13,027 |
|
8,893 |
|
19,092 |
|
Net cash and cash equivalents at end of the
period |
11,639 |
|
16,669 |
|
11,639 |
|
16,669 |
|
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