REG - Caledonia Mining Crp - Results for the Quarter ended March 31, 2022
12/05/2022 07:00
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RNS Number : 1687L Caledonia Mining Corporation PLC 12 May 2022
Caledonia Mining Corporation Plc
Results for the Quarter ended March 31, 2022
Notice of Management Conference Call
(NYSE AMERICAN: CMCL; AIM: CMCL; VFEX: CMCL)
St Helier, May 12, 2022: Caledonia Mining Corporation Plc ("Caledonia" or the
"Company") announces its operating and financial results for the quarter ended
March 31, 2022 (the "Quarter"). Further information on the financial and
operating results for the Quarter can be found in the Management Discussion
and Analysis ("MD&A") and the unaudited interim financial statements which
are available on the Company's website and which have been filed on SEDAR.
Financial Highlights
· Gross revenues of $35.1 million (Q1 2021: $25.7 million). Higher
revenues reflect a 40 per cent increase in production and a six per cent
increase in the realised gold price. Revenues include the sale proceeds of
442 ounces (net) of gold in work-in-progress.
· EBITDA of $14.6 million (Q1 2021: $9.7 million).
· On-mine cost 1 (#_ftn1) of $698 per ounce (Q1 2021: $836 per
ounce). Lower cost per ounce was primarily due to higher production, which
means that fixed costs are spread across more ounces, improved grade and
reduced use of diesel generators.
· All-in sustaining cost(1) of $968 per ounce (Q1 2021: $1,044 per
ounce).
· Adjusted earnings per share(1) of 62.5 cents (Q1 2021: 51.6 cents).
· Net cash from operating activities of $10.2 million (Q1 2021: $2.0
million).
· Net cash and cash equivalents of $14.4 million (Q1 2021: $13.0
million).
· Dividend paid in the Quarter of 14 cents per share, a 27 per cent
increase from 11 cents per share paid in Q1 2021. The quarterly dividend has
been maintained since October 2021.
Safety
· Regrettably, as previously reported, a fatal accident occurred on
February 21, 2022. The Directors and management of Caledonia and Blanket
Mine ("Blanket") express their sincere condolences to the family and
colleagues of the deceased. Caledonia and Blanket take the safety of its
employees very seriously and, accordingly, measures have been taken to
reinforce adherence to prescribed safety procedures.
Operating Highlights
· 18,515 ounces of gold produced in the Quarter (Q1 2021: 13,197
ounces). The 40 percent increase in production was due to higher tonnes
milled, improved grade and better metallurgical recoveries.
· 6,797 ounces of gold were produced in April 2022 which is an
annualised production rate of approximately 81,500 ounces.
· The Central Shaft, which was commissioned in March 2021, is currently
hoisting development waste, leaving the No. 4 Shaft free to hoist ore.
· An ore stockpile of approximately 14,000 tonnes, containing
approximately 1,500 ounces of recoverable gold, was accumulated during the
Quarter. This is not included in the gold production for the Quarter.
· The 12MWac solar project is now in the final phase of construction
and is expected to be operational within the next few months.
Outlook
· 2022 gold production guidance of between 73,000 and 80,000 ounces 2
(#_ftn2) .
Steve Curtis, Chief Executive Officer, commented:
"The first quarter of 2022 was an excellent start to 2022. Gold production in
the Quarter represents a new production record for any first quarter.
Production in April showed a further improvement: production of almost 6,800
ounces in the month reflects an annualised production rate that is marginally
above the top end of our guidance range for 2022 of 73,000 to 80,000 ounces of
gold. The higher production reflects increased tonnes milled, better grade
and improved recovery. Production in the Quarter excludes approximately
1,500 ounces of recoverable gold contained in an ore stockpile which
accumulated during the Quarter as we await the commissioning of an additional
mill later in the year.
"Operating costs were well controlled. The on-mine cost per ounce fell by 16
per cent compared to the first quarter of 2021. The reduction was because of
higher production, which means that fixed costs are spread over more
production ounces; costs were also helped by reduced diesel consumption
following the installation of equipment in late 2021 which allows us to manage
the poor-quality grid power.
"All-in sustaining costs per ounce were also 7 per cent lower than the first
quarter of 2021.
"Following Caledonia's successful secondary listing on the Victoria Falls
Stock Exchange in late 2021, we have increased the proportion of revenues
received in USD dollars. This, in conjunction with other arrangements, means
that we are not accumulating excessive local currency balances. We have a
strong, long-term working relationship with the Reserve Bank of Zimbabwe and
Fidelity Printers and Refiners (the Zimbabwe government-owned gold refiner)
and we are delighted that the payment process for gold deliveries and the
regulations that manage the flow of funds from Zimbabwe continue to operate
smoothly.
"The Central Shaft, which was commissioned in March 2021, is operating as
planned. The shaft is now hoisting waste material arising from the final
development to connect the shaft to the production areas. This has relieved
pressure on the Number 4 Shaft which can focus on hoisting ore until Central
shaft takes over this role later in the year. We are confident we will
achieve our production guidance for 2022 of 73,000 to 80,000 ounces.
"Safety remains our primary concern, and I am sorry to report that, after an
extended period without any fatal accident, in February 2022, a vehicle
accident underground resulted in the death of one employee. We have
re-doubled our efforts to ensure that we produce gold as safely as possible.
"Caledonia's immediate strategic focus is to convert the commissioning of
Central Shaft project into higher production, lower costs and increased cash
generation. We have made an excellent start in each of these objectives.
"We continue to evaluate further investment opportunities in the gold sector
in Zimbabwe, with our long-term vision of becoming a mid-tier, multi-asset
gold producer. However, we are highly disciplined in our approach: during
the Quarter we decided not to exercise the option over the Connemara North
exploration property because our further evaluations suggested that it does
not meet our commercial objectives. We continue to evaluate historical
information at the Maligreen exploration property with a view to publishing a
revised resource statement."
Conference Call Details
A presentation of the results for the Quarter and outlook for Caledonia is
available on Caledonia's website (www.caledoniamining.com). Management will
host a conference call / webinar at 3pm British Summer Time on May 16, 2022.
Details for the call are as follows:
When: May 16, 2022 at 3pm (BST)
Topic: Q1 Results Call for Shareholders
Register in advance for this webinar:
https://caledoniamining.zoom.us/webinar/register/WN_MDZ7d6uRSgatW555w2lnow
(https://caledoniamining.zoom.us/webinar/register/WN_MDZ7d6uRSgatW555w2lnow)
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
Cenkos (Nomad and Joint Broker)
Neil McDonald Tel: +44 131 220 9771
Pearl Kelie Tel: +44 131 220 9775
Liberum Capital Limited (Joint Broker) Tel: +44 20 3100 2000
Scott Mathieson/Kane Collings
BlytheRay Financial PR (UK)
Tim Blythe/Megan Ray Tel: +44 207 138 3204
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) Tel: +263 (242) 745 119/33/39
Dzika Dhana
Note: The information contained within this announcement is deemed by the
Company to constitute inside information under 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" 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 Consolidated Statement of Profit or Loss and Other Comprehensive
Income (unaudited)
($'000's) 3 months ended
March 31
2021 2022
Revenue 25,720 35,072
Royalty (1,289) (1,758)
Production costs (12,857) (14,359)
Depreciation (1,193) (2,063)
Gross profit 10,381 16,892
Other income 23 2
Other expenses (258) (793)
Administrative expenses (1,610) (2,371)
Net foreign exchange gain 273 909
Cash-settled share-based expense (152) (367)
Equity-settled share-based expense - (82)
Derivative financial instrument expenses (114) (1,738)
Operating profit 8,543 12,452
Net finance costs (118) (116)
Profit before tax 8,425 12,336
Tax expense (3,002) (4,719)
Profit for the period 5,423 7,617
Other comprehensive income
Items that are or may be reclassified to profit or loss
Exchange differences on translation of foreign operations (202) 693
Total comprehensive income for the period 5,221 8,310
Profit attributable to:
Owners of the Company 4,550 5,940
Non-controlling interests 873 1,677
Profit for the period 5,423 7,617
Total comprehensive income attributable to:
Owners of the Company 4,348 6,633
Non-controlling interests 873 1,677
Total comprehensive income for the period 5,221 8,310
Earnings per share (cents)
Basic 37.3 44.6
Diluted 37.2 44.6
Adjusted earnings per share (cents)
Basic 51.6 62.5
Dividends declared per share (cents) 11.0 14.0
Condensed Consolidated Statement of Cash Flows (unaudited)
($'000's) 3 months ended
March 31
2021 2022
Cash flows from operating activities
Cash generated from operations 2,550 11,844
Interest paid (123) (30)
Tax paid (464) (1,659)
Net cash from operating activities 1,963 10,155
Cash flows used in investing activities
Acquisition of property, plant and equipment (6,344) (9,734)
Acquisition of exploration and evaluation assets (190) (224)
Proceeds from disposal of subsidiary 340 -
Net cash used in investing activities (6,194) (9,958)
Cash flows from financing activities
Dividends paid (1,692) (1,788)
Term loan repayments (104) -
Payment of lease liabilities (32) (40)
Net cash used in financing activities (1,828) (1,828)
Net decrease in cash and cash equivalents (6,059) (1,631)
Effect of exchange rate fluctuations on cash and cash equivalents (6) (204)
Net cash and cash equivalents at beginning of the period 19,092 16,265
Net cash and cash equivalents at end of the period 13,027 14,430
Summarised Consolidated Statements of Financial Position
($'000's) As at Dec 31 Mar 31
2021 2022
Total non-current assets 157,944 168,063
Inventories 20,812 20,297
Prepayments 6,930 4,393
Trade and other receivables 7,938 10,215
Income tax receivable 101 37
Cash and cash equivalents 17,152 15,286
Total assets 210,877 218,291
Total non-current liabilities 12,633 11,629
Lease liabilities - short term portion 134 136
Trade and other payables 9,957 9,743
Derivative financial liabilities 3,095 4,037
Income tax payable 1,562 3,108
Overdraft 887 856
Cash-settled share-based payments - short term portion 2,053 818
Total liabilities 30,321 30,327
Total equity 180,556 187,964
Total equity and liabilities 210,877 218,291
1 (#_ftnref1) 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 (#_ftnref2) 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 (www.sedar.com (http://www.sedar.com) ) on May 26, 2021.
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