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Caledonia Mining Corporation Plc: Results for the quarter ended 31 March 2019

ID: 1549040
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(PresseBox) - Caledonia Mining Corporation Plc (?Caledonia? or the ?Company? - https://www.commodity-tv.net/c/search_adv/?v=298787) announces its operating and financial results for the first quarter of 2019 (?Q1? or the ?Quarter?).

Gold production in the Quarter was 11,948 ounces, approximately 8 per cent below the first quarter of 2018 (the ?comparable quarter? or ?Q1 2018?). Production was adversely affected by lower grade, although this was anticipated as part of the mine plan.

Consolidated operating profit before tax of $12.3m for the Quarter was 105 per cent higher than Q1 2018 although this increase was entirely due to exceptional gains of $3.3 million on foreign exchange following the devaluation of the domestic Zimbabwean currency and a profit on the sale of a subsidiary of $5.4m.

Attributable profit after tax was also substantially higher than the comparable quarter in 2018 at $9.3m again due to exceptional items which outweighed lower gross profit. Foreign exchange gains and profits arising on disposal are excluded from Caledonia?s adjusted earnings per share of 23 cents which were 44 per cent lower than the comparable quarter, largely due to reduced production and higher on-mine costs.

Operating cash flows for the Quarter were $6.3 million (Q1 2018; $7.0 million) and the Company?s balance sheet remains strong with net cash of $9.7 million as at 31 March 2019. Amounts stated below are expressed in thousands of US Dollars, unless otherwise stated or the context requires otherwise.

Commenting on the results, Steve Curtis, Caledonia?s Chief Executive Officer said:

?Notwithstanding the production difficulties experienced as a result of lower than expected production tonnage, unreliable electricity supply and lower mine grade, cash generation for the quarter was solid at $6.3 million - sufficient to support both capital investment in the Central Shaft project of $5.1 million and Caledonia?s regular quarterly dividend as well as maintain a healthy balance sheet with net cash of $9.7m at the end of March.



?Work on sinking the Central Shaft remains on track. I expect shaft sinking to be completed in the middle of this year after which a further 12 months will be needed to equip the shaft before it is commissioned in mid-2020 and we can begin to increase production to our target of 80,000 ounces per annum by 2022. This production increase will contribute significantly to reducing operating costs through economies of scale and we look forward to further increasing cash flows and earnings as the shaft is commissioned.

?We maintain our full year production guidance of 53,000 ? 56,000 ounces for 2019. I look forward to an improved cost performance in the remaining quarters of the year as we anticipate that the beneficial effects of improved production will be felt in the subsequent quarters of 2019.

Note:

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.ions, 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 explorationions 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.thiness 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; 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 anledonia 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.

?The early part of the Quarter was made more challenging by some significant macroeconomic disruptions.ed and we are confident that production will improve in the remainder of 2019.

?The devaluation did however have a one-off positive financial impact on our results with a foreign exchange gain of $3.3 million arising on the revaluation of assets and liabilities that are denominated in local currency.

?Unit costs in the Quarter, although higher than the comparable quarter of 2018, were largely as expected.

?Operating profit was boosted by exceptional one-off gains on the sale of Eersteling (a South African gold mine which has been held on care and maintenance for many years) and the foreign exchange gain arising on the devaluation of the domestic currency.

?I am particularly pleased that we have maintained a safe working environment during what was clearly a difficult time for all our Zimbabwe based employees. I join with my fellow directors in expressing our sincere gratitude to all our management and staff for their contribution to this achievement.

?Notwithstanding the challenges experienced in the Quarter, we remain encouraged by the overall direction of policy development which we believe will result in improved operating conditions and a better investment climate in Zimbabwe. The most recent positive development in this regard is the introduction of a gold support price of $1,368 per ounce, a premium above the prevailing spot price in order to incentivize domestic gold production. On the exploration front, we are also particularly encouraged by Zimbabwe?s geological prospectivity and we continue to evaluate potential investment opportunities.?



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Date: 05/15/2019 - 07:21
Language: English
News-ID 1549040
Character count: 10563
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Firma: Swiss Resource Capital AG
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Stadt: St Helier
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