Gold production in the Quarter was 12,924 ounces, marginally higher than the first quarter of 2017 and in-line with expectations.h of $13.4 million as at 31 March 2018.
Commenting on the results, Steve Curtis, Caledonia?s Chief Executive Officer said:
?The first quarter of 2018 was one of very strong cash generation at Blanket. control and benefit from economies of scale we look forward to further increasing cash flows and earnings.
?Gold production was marginally higher in the Quarter compared to the first quarter of 2017 and was in-line with our expectations.
?Profits in the Quarter benefitted from an 8% increase in the average realised gold price and a 3% reduction in all-in sustaining costs to $832 per ounce which contributed to a 10% increase in gross profit and a 35% increase in net attributable profit. On mine costs were marginally higher at $687 per ounce due to various operational factors which we expect to be addressed as the Central Shaft project is commissioned in 2020. Profit and cash flow were also boosted by the Government of Zimbabwe increasing the Export Credit Incentive (?ECI?) from 2.5% to 10% of revenue with effect from 1 February 2018.
?Regrettably our safety performance during the quarter was marred by a fatal accident at the mine on the 23 February 2018. My fellow directors and I express our sincere condolences to the family and friends of the deceased. The Company has embarked upon renewed efforts in the business to improve our safety performance.
?The Central Shaft remains a key enabler of long term value of the business and I am pleased to report that the project is progressing on schedule and within budget and importantly, remains fully funded by operating cash flow. For our technical team to deliver production and a transformational project for the business is a significant achievement. Following the decision to extend the shaft sinking project in November of 2017 the shaft has now reached 30 Level (990 metres) and work has commenced on establishing the station on this level.
?The operating environment and the investment climate in Zimbabwe continue to improve with government showing very pleasing levels of support of the mining industry, including the increase in the ECI for gold producers.lly increase its stake in the Blanket Mine subject to agreement with our local partners. We have been encouraged by the level of support that the new leadership has shown for the mining sector and the Zimbabwean economy in general and look forward to the opportunities that the improving macroeconomic environment in Zimbabwe is likely to present.
?We maintain our guidance of 55,000 to 59,000 ounces for the full year and earnings guidance of between 165 cents and 190 cents per share.?
Strategy and Outlook
Caledonia remains on track to achieve the production target of 80,000 ounces by 2021 at its Zimbabwean subsidiary, Blanket Mine. The Company?s strategic focus continues to be the implementation of the Investment Plan at Blanket, which was announced in November 2014 and is expected to extend the life of mine by providing access to deeper levels for production and further exploration.tunities to invest surplus cash.
On 4 July 2017, following the consolidation on 26 June 2017 of the Company?s shares, the Company announced an increased quarterly dividend of 6.875 cents per share which was paid on 28 July 2017 and further quarterly dividends of the same amount were paid on 27 October 2017, 26 January 2018 and 27 April 2018. The dividend of 6.875 cents per share effectively maintains the dividend at the previous level of 1.375 cents per share, after adjusting for the effect of the one-for-five share consolidation. The quarterly dividend of 6.875 cents is Caledonia?s current dividend policy which it is envisaged will be maintained.
Following the implementation of indigenisation in September 2012, Caledonia owns 49 per cent of the Blanket Mine in Zimbabwe. Caledonia continues to consolidate Blanket and the operational and the financial information set out below is on a 100 per cent basis unless otherwise indicated.
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., ?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.ns 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.
Potential shareholders and 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 anquired by law.
Firma: Swiss Resource Capital AG
Ansprechpartner: Stadt: St Helier
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