REG - Caledonia Mining Crp - Results for Q3 and 9M 2024
11/11/2024 07:15
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RNS Number : 6458L Caledonia Mining Corporation PLC 11 November 2024
Caledonia Mining Corporation Plc
Results for the quarter and nine months ended September 30, 2024
(NYSE AMERICAN: CMCL; AIM: CMCL; VFEX: CMCL)
St Helier, November 11, 2024: Caledonia Mining Corporation Plc ("Caledonia"
or "the Company") announces its operating and financial results for the
quarter and the nine months ended September 30, 2024 (the "Quarter" and "nine
months" respectively). Further information on the financial and operating
results for both can be found in the management discussion and analysis
("MD&A") and the unaudited financial statements, which are available on
the Company's website and are being filed on SEDAR+ and EDGAR.
Financial and Corporate Highlights
· Revenues in the Quarter of $46.9 million; nine months' revenue of
$135.5 million.
· Gross profit in the Quarter of $19.3 million increased from $14.1
million in the third quarter of 2023 (the "comparable quarter" or "Q3 2023")
due to the higher gold price and lower costs of the Bilboes oxide mine.
· Consolidated on-mine cost per ounce for the Quarter of $1,056 (Q3
2023: $928). The increase was mainly due to lower ounces sold and higher
production costs at Blanket.
· The group's all-in sustaining cost ("AISC") for the Quarter was
$1,501 per ounce (Q3 2023: $1,268 per ounce), the increase being due to lower
ounces sold, higher on-mine costs (primarily labour and electricity) and
increased cash-settled share-based payment expenses in the Quarter due to the
increase in Caledonia's share price.
· Basic IFRS earnings per share ("EPS") for the Quarter of 12.0
cents (Q3 2023: 24.1 cents).
· Adjusted EPS 1 (#_ftn1) for the Quarter of 26.2 cents (Q3
2023: 29.9 cents).
· Net cash from operating activities in the Quarter was $4.6
million, lower than the $14.5 million earned in the comparable quarter due to
lower operating profits, increased realised foreign exchange losses due to the
devaluation of the Zimbabwean currency ("ZiG"), increased tax payments due to
timing of payments, and increased working capital due to accelerating spend on
inventory levels during the Quarter to support preventative maintenance
initiatives and reduce potential production delays. Operating cashflow in the
Quarter before working capital movements was $16.2 million (Q3 2023: $16.3
million).
· A further dividend of 14 cents per share has been declared on
November 11, 2024 and will be paid on December 6, 2024. To streamline the
administration relating to board processes, and as previously announced,
dividends are now expected to be approved at the same time as the publication
of quarterly results.
Operational Summary
· Regrettably, a fatality occurred on September 21, 2024 as a result of
a rock fall while a Blanket mine employee was performing support drilling
activities in a decline area. Caledonia takes the safety of its employees very
seriously and, accordingly, measures have been taken to reinforce adherence to
prescribed safety procedures.
· Quarterly gold production of 18,992 ounces was lower than the
21,772 ounces produced in the comparable quarter (which established a new
production record) due to lower grade and reduced metallurgical
recoveries.
· Gold produced in the nine months was 56,815 ounces (nine months
2023: 55,244 ounces) at Blanket.
· Caledonia reiterates gold production guidance for 2024 of between
74,000 and 78,000 ounces 2 (#_ftn2) at Blanket.
· On-mine cost guidance for 2024 at Blanket has increased to between
$950 and $1,050 per ounce from the previous guidance of $870 to $970 per ounce
due to higher labour and electricity costs. Management is pursuing initiatives
to achieve cost reductions in both of these areas.
· A conditional sale agreement to sell the company which owns the
12.2MWac solar plant for $22.35 million, payable in cash, was signed on
September 30, 2024. Upon completion of the sale, Caledonia will realise a
profit on the $14.3 million construction cost while Blanket will retain the
exclusive supply of energy.
· $2.3 million increase in inventory levels during the Quarter to
support preventative maintenance initiatives and reduce potential production
delays. $2.7 million planned in the last quarter of 2024.
· Caledonia has published encouraging results from its recent
exploration programme at Motapa, which comprised deeper drilling below
historic open pits and shallower drilling in a new target area.
Strategy and Outlook: increased focus on growth opportunities
The immediate strategic focus is to:
· Maintain production at Blanket at the targeted range of 74,000 to
78,000 ounces for 2024 and at a similar level for 2025;
· Complete the Caledonia feasibility study on the Bilboes sulphide
project (expected first quarter of 2025); progress development funding
solutions; commence development of the sulphide project; and
· Continue with exploration activities at Motapa.
Commenting on the announcement, Mark Learmonth, Chief Executive Officer,
said:
"I am pleased to report that production for the Quarter was in line with
expectations and we remain on track to meet our production guidance for the
year.
"Regrettably, during the Quarter we had a fatality at Blanket. I would like to
extend our condolences to the family and friends of the deceased. We remain
committed to improving our safety performance and delivering a zero-harm
environment.
"We continue to explore ways to reduce on-mine costs at Blanket - particularly
the cost of electricity and labour where several initiatives are being
implemented and further measures are under consideration.
"In parallel, we continue to carefully manage our cashflows and working
capital, albeit we have made the strategic decision to accelerate investment
in inventory levels during the Quarter to support preventative maintenance
initiatives and reduce potential production delays. This investment would have
previously been scheduled for 2025. Our cash reserves have also been
negatively impacted by the currency devaluation in Zimbabwe during the
Quarter.
"During the Quarter, Caledonia announced the signing of a conditional sale
agreement to sell the subsidiary that owns the 12.2MWac solar plant which
supplies power to Blanket for $22.35 million. Completion of the sale will
return capital to Caledonia at a key moment in the Company's growth trajectory
while retaining the exclusive energy offtake, ensuring approximately 20%
of Blanket's daily electricity requirement continues to be met by renewable
power.
"Blanket remains a solid foundation for our growth profile in Zimbabwe; our
exploration activities at both Blanket and Motapa continue to deliver
encouraging results, playing to our future growth ambitions.
"We continue to progress the revised feasibility study for the Bilboes
sulphide project with a focus on capital allocation and expect to complete
this in the first quarter of 2025. We are also making encouraging progress
towards identifying and implementing a funding structure for Bilboes with the
objective of minimising equity dilution and optimising the uplift in net
present value per Caledonia share. We are excited by this opportunity to
evolve our business and expand our production profile, which we believe will
generate significant long term shareholder value."
Caledonia will host an online presentation and Q&A session open to all
investors on 11 November at 14.00 London Time
You are invited to a Zoom webinar.
When: Nov 11, 2024 02:00 PM London
Topic: Q3 2024 Results call for Investors
Register in advance for this webinar:
https://caledoniamining.zoom.us/webinar/register/WN_ZHTT-Ji5RDylrtSaSYE0fA
(https://caledoniamining.zoom.us/webinar/register/WN_ZHTT-Ji5RDylrtSaSYE0fA)
After registering, you will receive a confirmation email containing
information about joining the webinar.
Enquiries:
Caledonia Mining Corporation Plc
Mark Learmonth Tel: +44 1534 679 800
Camilla Horsfall Tel: +44 7817 841 793
Cavendish Capital Markets Limited (Nomad and Joint Broker)
Adrian Hadden
Pearl Kellie Tel: +44 207 397 1965
Tel: +44 131 220 9775
Panmure Liberum Limited (Joint Broker)
Scott Mathieson Tel: +44 20 3100 2000
Matt Hogg
Camarco, Financial PR (UK)
Gordon Poole Tel: +44 20 3757 4980
Julia Tilley
Elfie Kent
3PPB (Financial PR, North America)
Patrick Chidley Tel: +1 917 991 7701
Paul Durham Tel: +1 203 940 2538
Curate Public Relations (Zimbabwe)
Debra Tatenda Tel: +263 77802131
IH Securities (Private) Limited (VFEX Sponsor - Zimbabwe)
Lloyd Mlotshwa Tel: +263 (242) 745 119/33/39
Craig James Harvey, MGSSA, MAIG, Caledonia Vice President, Technical
Services, has reviewed and approved the scientific and technical information
contained in this news release. Craig James Harvey is a "Qualified Person" as
defined by each of (i) the Canadian Securities Administrators' National
Instrument 43-101 - Standards of Disclosure for Mineral Projects and (ii)
sub-part 1300 of Regulation S-K of the U.S. Securities Act.
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 Information
Information and statements contained in this news release that are not
historical facts are "forward-looking information" or "forward-looking
statements" within the meaning of applicable securities legislation
(collectively, "forward-looking information") 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 and cost
guidance, estimates of future/targeted production rates, our plans and timing
regarding further exploration and drilling and development at Motapa, the
development of the Bilboes Sulphide Project, the continuation of dividend
payments, the currency devaluation in Zimbabwe, and our plans and timing
regarding the completion of the sale of the 12.2MWac solar plant. 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 information. 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.
Condensed Consolidated Statements of profit or loss and Other comprehensive
income (Unaudited)
($'000's)
3 months ended September 30 9 months ended September 30
2024 2023 2024 2023
Revenue 46,868 41,187 135,503 107,653
Royalty (2,422) (2,207) (6,831) (5,650)
Production costs (21,085) (20,452) (60,505) (61,028)
Depreciation (4,048) (4,385) (12,106) (10,049)
Gross profit 19,313 14,143 56,061 30,926
Net foreign exchange loss (3,129) (257) (9,282) (2,334)
Administrative expenses (3,954) (2,889) (10,229) (11,890)
Net derivative financial instrument expenses (20) (102) (496) (590)
Equity-settled share-based expense (279) (233) (785) (564)
Cash-settled share-based expense (422) (27) (479) (298)
Other expenses (2,814) (701) (4,078) (2,800)
Other income 16 62 365 127
Operating profit 8,711 9,996 31,077 12,577
Net finance costs (824) (508) (2,344) (2,332)
Profit before tax 7,887 9,488 28,733 10,245
Tax expense (4,600) (3,777) (12,281) (8,552)
Profit for the period 3,287 5,711 16,452 1,693
Other comprehensive income
Items that are or may be reclassified to profit or loss
Exchange differences on translation of foreign operations 629 (79) 663 (778)
Total comprehensive income for the period 3,916 5,632 17,115 915
Profit (loss) attributable to:
Owners of the Company 2,267 4,506 12,827 (1,036)
Non-controlling interests 1,020 1,205 3,625 2,729
Profit for the period 3,287 5,711 16,452 1,693
Total comprehensive income attributable to:
Owners of the Company 2,896 4,427 13,490 (1,814)
Non-controlling interests 1,020 1,205 3,625 2,729
Total comprehensive income for the period 3,916 5,632 17,115 915
Earnings (loss) per share (cents)
Basic 12.0 24.1 65.5 (6.8)
Diluted 12.0 24.0 65.5 (6.8)
Adjusted earnings per share (cents)
Basic 26.2 29.9 84.9 6.0
Dividends paid per share (cents) 14.0 14.0 42.0 56.0
Summarised Consolidated Statements of Financial Position (Unaudited)
($'000's) As at Sep-30 Dec-31
2024 2023
Total non-current assets 279,803 274,074
Income tax receivable 70 1,120
Inventories 22,732 20,304
Derivative financial assets - 88
Trade and other receivables 9,651 9,952
Prepayments 6,717 2,538
Cash and cash equivalents 7,204 6,708
Assets held for sale 13,483 13,519
Total assets 339,660 328,303
Total non-current liabilities 26,307 23,978
Cash-settled share-based payments - short term portion 1,081 920
Income tax payable 2,244 10
Lease liabilities - short term portion 94 167
Loan notes - short term portion 855 665
Trade and other payables 22,278 20,503
Overdraft and term loans 14,839 17,740
Liabilities associated with assets held for sale 98 128
Total liabilities 67,796 64,111
Total equity 271,864 264,192
Total equity and liabilities 339,660 328,303
Condensed Consolidated Statements of Cash Flows (Unaudited)
($'000's)
3 months ended 9 months ended
September 30 September 30
2024 2023 2024 2023
Cash inflow from operations 11,407 16,963 38,930 17,629
Interest received 7 21 16 30
Finance costs paid (781) (331) (2,064) (1,762)
Tax paid (6,042) (2,158) (8,318) (4,504)
Net cash inflow from operating activities 4,591 14,495 28,564 11,393
Cash flows used in investing activities
Acquisition of property, plant and equipment (6,751) (9,573) (17,389) (20,175)
Acquisition of exploration and evaluation assets (245) (597) (1,408) (880)
Acquisition of put options - (1) (408) (812)
Net cash used in investing activities (6,996) (10,171) (19,205) (21,867)
Cash flows from financing activities
Dividends paid (3,430) (2,801) (9,062) (8,118)
Payment of lease liabilities (39) (36) (114) (108)
Shares issued - equity raise (net of transaction cost) - - - 15,658
Proceeds from long term loans 1 - 2,033 -
Repayments of term loans (262) - (262) -
Loan notes - Motapa payment - (563) - (7,250)
Loan notes - solar bond issue receipts (net of transaction cost) - - 1,939 7,000
Net cash (used in)/ from financing activities (3,730) (3,400) (5,466) 7,182
Net (decrease) increase in cash and cash equivalents (6,135) 924 3,893 (3,292)
Effect of exchange rate fluctuations on cash and cash equivalents (134) (1,209) (496) (1,396)
Net cash and cash equivalents at beginning of the period (1,366) (2,907) (11,032) 1,496
Net cash and cash equivalents at end of the period (7,635) (3,192) (7,635) (3,192)
1 (#_ftnref1) Adjusted EPS excludes net foreign exchange movements
(including the deferred tax effect and the non-controlling interest thereon)
and deferred tax. A reconciliation of IFRS EPS to Adjusted EPS is set out in
section 10.3 of the MD&A.
2 (#_ftnref2) Refer to technical report "NI 43-101 Technical Report on the
Blanket Gold Mine, Zimbabwe" with effective date December 31, 2023 prepared by
Caledonia Mining Corporation Plc and filed by the Company on SEDAR+
(www.sedarplus.ca (http://www.sedarplus.ca/) ) on May 15, 2024
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