eBusiness Weekly
Business Writer
Notwithstanding the impact of the Covid-19 pandemic, Zimbabwe-focused gold producer, Caledonia Mining Corporation, posted increased output at its Blanket Gold Mine.
Operations over the three-month period were largely stable at 93 percent.
Caledonia has reported output of the yellow metal at the Gwanda-based Blanket Mine in the second quarter at 13,499 ounces, up from 12,712 ounces in the prior comparative quarter.
Production since the beginning of the year was 27 732 ounces, compared to 24 660 ounces in the first half of 2019.
The mining group said all-in sustaining costs (AISC) at Blanket for the quarter excluding the effects of Covid-19 were US$831 per ounce.
Management says Blanket is well set to achieve on-mine cost guidance for 2020 of between US$693 to US$767 per ounce and all-in sustaining cost guidance of between US$951 to US$1,033 per ounce.
Gross revenues were up 39 percent to US$22.9 million from the US$16,5 million recorded in the second quarter of last year, while underlying earnings (EBITDA), excluding net foreign exchange gains, surged 35 percent to US$9,6 million from US$7,1 million the year before.
Commenting on the Q2 performance CEO Steve Curtis said: “The management initiatives, which were implemented in 2019 have continued into 2020 and have resulted in a 12,4 percent increase in gold production in the first six months of 2020 compared to the same period of 2019.
“Net cash flow from operating activities (i.e. before interest, taxation payments and capital expenditure) was US$4 million in the quarter compared to US$2,1 million in Q2 of 2019. Caledonia ended the quarter with net cash and cash equivalents of $11,7 million (excluding $1 million of a gold ETF [exchange traded fund] which we purchased in the quarter to protect cash in South Africa against devaluation of the South African rand).”
Added Mr Curtis: “Subject to the continuation of travel and transport restrictions arising from the Covid-19 pandemic, this project could be operational by mid-2021.
“The board will review Caledonia’s future dividend distributions as appropriate while considering the balance between delivering returns to shareholders and pursuing the significant growth opportunities within Zimbabwe and in line with a prudent approach to financial management.”
