VANCOUVER, Aug. 6, 2019 /CNW/ - B2Gold Corp. (TSX: BTO, NYSE
AMERICAN: BTG, NSX: B2G) ("B2Gold" or the "Company") is pleased to
announce its operational and financial results for the second
quarter and first-half of 2019. All dollar figures are in
United States dollars unless
otherwise indicated.
On July 2, 2019, B2Gold and
Calibre Mining Corp. ("Calibre") announced that they had entered
into an agreement for B2Gold to restructure its interests in, and
for Calibre to acquire, El Limon and La Libertad mines (see
"B2Gold and Calibre Join Forces in Nicaragua" section below). The Company
expects the sale to be completed early in the fourth quarter of
2019. Accordingly, the Company has classified its El Limon and La
Libertad mines as discontinued operations for the three and six
months ended June 30, 2019 and 2018
for financial reporting purposes.
2019 Second Quarter Highlights
- Record quarterly consolidated gold production of 246,020 ounces
(including El Limon and La Libertad) well-above budget by 8%
(17,194 ounces) and 2% (5,927 ounces) over the same period last
year with solid performances from all the Company's operations
- Consolidated gold revenues from continuing operations of
$267 million on sales of 203,700
ounces (5% or 9,591 ounces above budget); consolidated gold
revenues of $310 million on sales of
236,282 ounces, including gold sales from El Limon and La
Libertad
- Consolidated cash operating costs (see "Non-IFRS
Measures") from continuing operations of $456 per ounce produced ($468 per ounce sold), below budget by
$42 per ounce (8%); including El
Limon and La Libertad, consolidated cash operating costs of
$529 per ounce produced ($543 per ounce sold), below budget by
$37 per ounce (7%)
- Consolidated all-in sustaining costs ("AISC") (see "Non-IFRS
Measures") from continuing operations of $807 per ounce sold, well-below budget by
$87 per ounce (10%); including El
Limon and La Libertad, consolidated AISC of $914 per ounce sold, below budget by $37 per ounce (4%)
- Consolidated cash flow provided by operating activities of
$93 million ($0.09 per share) (including $9 million from discontinued operations) compared
to $86 million ($0.09 per share) (including $6 million from discontinued operations) in the
prior-year quarter
- Net income from continuing operations of $45 million ($0.04
per share); net income of $41 million
($0.04 per share); adjusted net
income (see "Non-IFRS Measures") of $52 million ($0.05
per share)
- New large-scale off-grid Fekola Solar Plant Project approved by
the B2Gold Board, scheduled for completion in August 2020; expected to provide significant
operating cost reductions (estimated to reduce Fekola's processing
costs by approximately 7%)
- Otjikoto Mine continued its remarkable safety performance,
extending the number of days without a lost-time-injury ("LTI") to
488 days (3.8 million man-hours) at the end of the second quarter
of 2019
- On July 2, 2019, B2Gold and
Calibre announced that they have agreed to join forces in
Nicaragua and have entered into an
agreement for B2Gold to restructure its interests in, and for
Calibre to acquire, El Limon and La Libertad gold mines for
aggregate consideration of $100 million
2019 First-Half Highlights
- Consolidated gold production of 476,879 ounces (including El
Limon and La Libertad), 7% (29,898 ounces) above budget
- Consolidated gold revenues from continuing operations of
$531 million on sales of 407,100
ounces (7% or 27,581 ounces above budget); consolidated gold
revenues of $612 million on sales of
468,358 ounces, including gold sales from El Limon and La
Libertad
- Consolidated cash operating costs from continuing operations of
$455 per ounce produced ($462 per ounce sold), below budget by
$43 per ounce (9%); including El
Limon and La Libertad, consolidated cash operating costs of
$538 per ounce produced ($544 per ounce sold), below budget by
$31 per ounce (5%)
- Consolidated AISC from continuing operations of $775 per ounce sold, significantly below budget
by $103 per ounce (12%); including El
Limon and La Libertad, consolidated AISC of $882 per ounce sold, well-below budget by
$83 per ounce (9%)
- Consolidated cash flow provided by operating activities of
$179 million ($0.18 per share) (including $11 million from discontinued operations)
- Net income from continuing operations of $80 million ($0.07
per share); net income of $68 million
($0.06 per share); adjusted net
income of $90 million ($0.09 per share)
- On March 26, 2019, the Company
announced positive results from the Expansion Study Preliminary
Economic Assessment ("PEA") for the Fekola Mine, including
significant estimated increases in average annual gold production
to over 550,000 ounces per year during the five-year period
2020-2024, and is proceeding with an expansion project to increase
Fekola's processing throughput by 1.5 million tonnes per annum
("Mtpa") to 7.5 Mtpa from the assumed base rate of 6 Mtpa
- For full-year 2019, B2Gold remains well positioned for
continued strong operational and financial performance with
consolidated gold production forecast to be in the range of between
935,000 and 975,000 ounces with cash operating costs forecast to be
between $520 and $560 per ounce sold and AISC forecast to be
between $835 and $875 per ounce sold; if the anticipated sale of
the Company's Nicaraguan operations to Calibre is completed early
in the fourth quarter of 2019, and the Company maintains a 31%
interest in Calibre post transaction thereafter, as anticipated,
the Company anticipates that it will still meet the low end of the
Company's consolidated production guidance ranges for 2019
2019 Second Quarter and First-Half Operational
Results
Including El Limon and La Libertad, consolidated gold production
in the second quarter of 2019 was a quarterly record of 246,020
ounces, well-above budget by 8% (17,194 ounces) with solid
performances from all the Company's operations. Gold production
from the Company's Fekola, Masbate, Otjikoto and La Libertad mines
all exceeded their targeted production, with El Limon's production
in-line with budget. The Fekola Mine in Mali and the Masbate Mine in the Philippines continued their very strong
operational performances, with both significantly above their
budgeted production for the quarter. For the second quarter of
2019, the Fekola Mine produced 113,897 ounces of gold, exceeding
budget by 10% (10,272 ounces), and the Masbate Mine produced 57,572
ounces of gold, exceeding budget by 7% (3,587 ounces). Compared to
the prior-year quarter, gold production increased by 2% (5,927
ounces). Consolidated gold production from continuing operations
totaled 208,890 ounces in the second quarter of 2019.
Consolidated cash operating costs from continuing operations in
the quarter were $456 per ounce
produced ($468 per ounce sold) (Q2
2018 - $410 per ounce produced),
below budget by $42 per ounce (8%).
The favourable budget variance was mainly attributable to
higher-than-budgeted production. Compared to the prior-year
quarter, consolidated cash operating costs were higher mainly due
to the lower grade ore tonnage processed at Fekola (as a result of
Fekola's significantly higher-than-budgeted mill throughput) and
lower operating costs incurred by Fekola during the start-up phase
in the second quarter of 2018. In addition, operating costs at the
other locations were higher in the second quarter of 2019, as
anticipated, due to higher fuel costs and labour cost increases.
Including El Limon and La Libertad, consolidated cash operating
costs for the quarter were $529 per
ounce produced ($543 per ounce
sold).
Consolidated AISC from continuing operations in the quarter were
$807 per ounce sold (Q2 2018 -
$654 per ounce sold), well-below
budget by $87 per ounce (10%),
primarily resulting from lower-than-budgeted cash operating costs
noted above together with lower-than-planned sustaining capital
expenditures. Compared to the prior year quarter, consolidated AISC
were higher as a result of the increased cash operating costs noted
above and the timing of Otjikoto's pre-stripping activities,
weighted towards the first-half of the year. Including El Limon and
La Libertad, consolidated AISC for the quarter were $914 per ounce sold.
Consolidated gold production from continuing operations totaled
409,432 ounces in the first-half of 2019. Including El Limon and La
Libertad, consolidated gold production in the first-half of 2019
was 476,879 ounces, 7% (29,898 ounces) above budget and comparable
with the first-half of 2018.
For the first-half of 2019, consolidated cash operating costs
from continuing operations were $455
per ounce produced ($462 per ounce
sold) (Q2 2018 - $403 per ounce
produced), below budget by $43 per
ounce (9%). Including El Limon and La Libertad mines, consolidated
cash operating costs for the first-half of 2019 were $538 per ounce produced ($544 per ounce sold).
Year-to-date, consolidated AISC from continuing operations were
$775 per ounce sold (YTD 2018 -
$637 per ounce sold), significantly
below budget by $103 per ounce (12%).
Including El Limon and La Libertad mines, consolidated AISC for the
first-half of 2019 were $882 per
ounce sold. AISC were lower-than-budget as a result of higher gold
ounces sold than budgeted and lower-than-budgeted sustaining
capital expenditures resulting from a combination of timing
differences and lower than expected pre-stripping costs of which
$11 million is not expected to be
incurred as previously budgeted.
Given the gold production outperformance in the first-half of
2019, B2Gold remains well positioned for continued strong
operational and financial performance with consolidated gold
production for full-year 2019 forecast to be in the range of
between 935,000 and 975,000 ounces. With the gold production
outperformance experienced in the first-half of 2019, the Company
now expects that consolidated production will be less significantly
weighted towards the second-half of the year. Consolidated cash
costs are projected to remain low in 2019 with cash operating costs
forecast to be between $520 and
$560 per ounce and AISC forecast to
be between $835 and $875 per ounce. If the anticipated sale of the
Company's Nicaraguan operations to Calibre is completed early in
the fourth quarter of 2019, and the Company maintains a 31%
interest in Calibre post transaction thereafter, as anticipated,
the Company expects that it will meet the low end of the Company's
consolidated production guidance range for 2019. In addition, the
Company anticipates that it will meet its 2019 consolidated cash
cost and AISC guidance ranges.
B2Gold and Calibre Join Forces in Nicaragua
On July 2, 2019 (see news
release dated 7/2/2019), B2Gold
and Calibre announced that they had entered into an agreement for
B2Gold to restructure its interests in, and for Calibre to acquire,
El Limon and La Libertad gold mines, the Pavon gold project, and
additional mineral concessions in Nicaragua (collectively, the "Nicaraguan
Assets") held by B2Gold for aggregate consideration of $100 million, which will be paid with a
combination of cash, common shares and a convertible debenture.
Following the completion of the transaction, B2Gold will own an
approximate 31% direct equity interest in Calibre. B2Gold's ongoing
commitment to continuing involvement with the Nicaraguan operations
will be secured by its significant equity interest in Calibre, its
right to appoint one director to the Board of Calibre and its
participation in an Advisory Board to the main Board of Calibre.
The closing of this transaction will be subject to certain
conditions including majority of minority shareholder approval, the
closing of the concurrent private placement by Calibre (for gross
proceeds of up to CDN$100 million)
and other customary closing conditions. The Company expects the
sale to be completed early in the fourth quarter of 2019.
2019 Second Quarter and First-Half Financial
Results
Consolidated gold revenue from continuing operations for the
second quarter of 2019 was $267
million on sales of 203,700 ounces at an average price of
$1,312 per ounce compared to
$242 million on sales of 188,029
ounces at an average price of $1,289
per ounce in the second quarter of 2018. The increase in gold
revenue of $25 million (10%) was
attributable to an 8% increase in the gold ounces sold and a 2%
increase in the average realized gold price. Including gold sales
from El Limon and La Libertad, consolidated gold revenue totaled
$310 million in the quarter on sales
of 236,282 ounces at an average realized price of $1,313 per ounce.
Cash flow provided by operating activities in the second quarter
of 2019 totaled $93 million
($0.09 per share) (including
$9 million from discontinued
operations) compared to $86 million
($0.09 per share) (including
$6 million from discontinued
operations) in the prior-year quarter. The increase mainly reflects
higher gold revenue, partially offset by higher income tax
installment payments for Fekola.
Net income from continuing operations in the quarter was
$45 million ($0.04 per share) compared to $28 million ($0.03
per share) in the same period last year. For the second quarter of
2019, the Company generated net income of $41 million ($0.04
per share) (including Nicaragua)
compared to $21 million ($0.02 per share) in the second quarter of 2018.
Adjusted net income for the second quarter of 2019 was $52 million ($0.05
per share) compared to $46 million
($0.05 per share) in the second
quarter of 2018.
For the first-half of 2019, consolidated gold revenue from
continuing operations was $531
million on sales of 407,100 ounces at an average price of
$1,305 per ounce compared to
$540 million on sales of 413,458
ounces at an average price of $1,307
per ounce in the first-half of 2018. The decrease in gold revenue
was attributable to a 2% decrease in the gold ounces sold.
Including gold sales from El Limon and La Libertad, consolidated
gold revenue totaled $612 million in
the first-half of 2019 on sales of 468,358 ounces at an average
realized price of $1,307 per
ounce.
Cash flow provided by operating activities in the first-half of
2019 totaled $179 million
($0.18 per share) (including
$11 million from discontinued
operations) compared to $233 million
($0.24 per share) (including
$15 million from discontinued
operations) in the first-half of 2018. The decrease mainly reflects
higher income tax installment payments for Fekola, as well as lower
gold revenue and higher production costs.
Net income from continuing operations in the first-half of 2019
was $80 million ($0.07 per share) compared to $94 million ($0.09
per share) in the same period last year. For the first-half of
2019, the Company generated net income of $68 million ($0.06
per share) (including Nicaragua)
compared to $79 million ($0.08 per share) in the first-half of 2018.
Adjusted net income for the first-half of 2019 was $90 million ($0.09
per share) compared to adjusted net income of $104 million ($0.11
per share) in the first-half of 2018.
Liquidity and Capital Resources
At June 30, 2019, the Company had
cash and cash equivalents of $114
million ($124 million
including $10 million of cash
associated with discontinued operations) compared to cash and cash
equivalents of $103 million at
December 31, 2018. Working capital at
June 30, 2019 was $192 million ($227
million including $35 million
of working capital associated with discontinued operations)
compared to $156 million at
December 31, 2018.
During the six months ended June 30,
2019, the Company made repayments of $25 million on the revolving credit facility
("RCF"). At June 30, 2019, the
Company had drawn $375 million under
the $600 million RCF, leaving an
undrawn and available balance under the existing facility of
$225 million.
On May 10, 2019, the Company
entered into a revised RCF agreement with its existing syndicate of
banks plus one new lender, to upsize its RCF capacity from
$500 million to $600 million and to increase the accordion
feature from $100 million to
$200 million. In addition, as a
reflection of B2Gold's financial strength, the upsized RCF included
increased flexibility for permitted borrowings and equipment
financings, coupled with less onerous financial covenants and lower
pricing. The revised RCF bears interest on a sliding scale of
between LIBOR plus 2.125% to 2.75% based on the Company's
consolidated net leverage ratio. Commitment fees for the undrawn
portion of the facility are also on a similar sliding scale basis
of between 0.48% and 0.62%. The term of the revised RCF is four
years, maturing on May 9, 2023. The
upsized RCF, coupled with strong operating cash flows from the
Company's existing mine operations, is expected to provide the
Company with continued financial flexibility to advance existing
assets and pursue exploration opportunities.
The Company's current strategy is to continue to reduce debt,
expand the Fekola Mine throughput and annual production, further
advance its pipeline of development and exploration projects and
evaluate exploration opportunities.
Operations
Mine-by-mine gold production (ounces) and gold sales (ounces) in
the second quarter and first-half of 2019 were as follows
(presented on a 100% basis):
Mine
|
Q2
2019 Gold
Production (ounces)
|
Q2
2019 Gold Sales (ounces)
|
First-Half
2019 Gold
Production (ounces)
|
First-Half
2019 Gold Sales (ounces)
|
Full-year
2019 Forecast Gold
Production (ounces)
|
Fekola
|
113,897
|
106,200
|
224,246
|
222,000
|
420,000 -
430,000
|
Masbate
|
57,572
|
62,100
|
115,053
|
112,500
|
200,000 -
210,000
|
Otjikoto
|
37,421
|
35,400
|
70,133
|
72,600
|
165,000 -
175,000
|
From
Continuing
Operations
|
208,890
|
203,700
|
409,432
|
407,100
|
785,000 -
815,000
|
|
|
|
|
|
|
La
Libertad
|
25,672
|
22,791
|
43,758
|
40,063
|
95,000 -
100,000
|
El Limon
|
11,458
|
9,791
|
23,689
|
21,195
|
55,000 -
60,000
|
From
Discontinued
Operations
|
37,130
|
32,582
|
67,447
|
61,258
|
150,000 -
160,000
|
|
|
|
|
|
|
B2Gold
Consolidated
|
246,020
|
236,282
|
476,879
|
468,358
|
935,000 -
975,000
|
Mine-by-mine cash operating costs (on a per ounce of gold sold
basis) in the second quarter and first-half of 2019 were as follows
(based on the total operations at the mines B2Gold operates):
Mine
|
Q2
2019 Cash Operating
Costs ($ per ounce
sold)
|
First-Half
2019 Cash Operating
Costs ($ per ounce
sold)
|
2019 Annual
Guidance Cash Operating
Costs ($ per ounce
sold)
|
Fekola
|
$373
|
$386
|
$370 -
$410
|
Masbate
|
$566
|
$557
|
$625 -
$665
|
Otjikoto
|
$582
|
$549
|
$520 -
$560
|
From
Continuing
Operations
|
$468
|
$462
|
$465-
$505
|
|
|
|
|
La
Libertad
|
$1,030
|
$1,144
|
$840 -
$880
|
El Limon
|
$973
|
$983
|
$720 -
$760
|
From
Discontinued
Operations
|
$1,013
|
$1,088
|
$795 -
$835
|
|
|
|
|
B2Gold
Consolidated
|
$543
|
$544
|
$520 -
$560
|
Mine-by-mine cash operating costs (on a per ounce of gold
produced basis), in the second quarter and first-half of 2019 were
as follows (based on the total operations at the mines B2Gold
operates):
Mine
|
Q2
2019 Cash Operating
Costs ($ per ounce
produced)
|
First-Half
2019 Cash Operating
Costs ($ per ounce
produced)
|
Fekola
|
$367
|
$375
|
Masbate
|
$570
|
$538
|
Otjikoto
|
$554
|
$576
|
From Continuing
Operations
|
$456
|
$455
|
|
|
|
La
Libertad
|
$936
|
$1,110
|
El Limon
|
$953
|
$916
|
From
Discontinued Operations
|
$941
|
$1,042
|
|
|
|
B2Gold
Consolidated
|
$529
|
$538
|
Mine-by-mine AISC per ounce (on a per ounce of gold sold basis)
in the second quarter and first-half of 2019 were as follows (based
on the total operations at the mines B2Gold operates):
Mine
|
Q2
2019 AISC ($ per ounce sold)
|
First-Half
2019 AISC ($ per ounce sold)
|
2019 Annual
Guidance AISC ($ per ounce sold)
|
Fekola
|
$625
|
$619
|
$625 -
$665
|
Masbate
|
$749
|
$746
|
$860 -
$900
|
Otjikoto
|
$1,174
|
$997
|
$905 -
$945
|
From
Continuing
Operations
|
$807
|
$775
|
$745 -
$785
|
|
|
|
|
La
Libertad
|
$1,577
|
$1,607
|
$1,150 -
$1,190
|
El Limon
|
$1,617
|
$1,567
|
$1,005 -
$1,045
|
From
Discontinued
Operations
|
$1,589
|
$1,593
|
$1,095 -
$1,135
|
|
|
|
|
B2Gold
Consolidated
|
$914
|
$882
|
$835 -
$875
|
Fekola Gold Mine - Mali
The Fekola Mine in Mali
continued its very strong operational performance with second
quarter gold production of 113,897 ounces (Q2 2018 - 112,644
ounces), well-above budget by 10% (10,272 ounces) as the Fekola
processing facilities continued to outperform. The operation
continued to demonstrate sustained high processing throughput
without reduced recoveries.
For the second quarter of 2019, mill throughput was 1.8 million
tonnes, exceeding budget by 34% and the prior-year quarter by 37%.
The average grade processed was 2.07 grams per tonne ("g/t")
together with average gold recoveries of 94.4%. Continuing the
trends set in the first quarter of the year, processing of ore with
favourable metallurgical characteristics (including oxidized
saprolite ore) combined with finer than budgeted feed size from the
primary crusher (due to a combination of better ore fragmentation
in the pit and softer low-grade ore) has allowed for the processing
of additional lower grade ore from stockpile and run-of-mine
sources, beyond what was originally budgeted. This has resulted in
a lower average processed grade, but also a significant increase in
gold production along with marginally increased cash operating
costs per ounce. Gold tonnage and grade continue to reconcile well
with the resource model.
Fekola's second quarter cash operating costs were $367 per ounce produced ($373 per gold ounce sold) (Q2 2018 - $318 per ounce produced), below budget by
$33 per ounce (8%). This was mainly
the result of higher-than-budgeted gold production partially offset
by higher costs per ounce for the additional higher-than-budgeted
lower grade ore tonnage processed during the quarter as discussed
above. Total costs of production were on budget. Compared to the
prior-year quarter, cash operating costs were higher due to the
additional higher-than-budgeted lower grade material being
processed during the quarter and lower operating costs incurred by
Fekola during the start-up phase in the second quarter of 2018.
Fekola's AISC for the quarter were $625 per ounce sold (Q2 2018 - $453 per ounce sold), well-below budget by
$82 per ounce (12%).
For the first-half of 2019, the Fekola Mine produced 224,246
ounces of gold, above budget by 8% (16,996 ounces) and comparable
with the first-half of 2018.
Fekola's cash costs remained below budget in the first-half of
the year with cash operating costs of $375 per ounce produced ($386 per gold ounce sold) (YTD 2018 -
$293 per ounce produced),
$9 per ounce below budget, and AISC
of $619 per ounce sold (YTD 2018 -
$464 per ounce sold), $57 per ounce (8%) below budget.
Capital expenditures in the second quarter of 2019 totaled
$13 million, mainly consisting of
$4 million for pre-stripping,
$4 million in costs related to the
processing and mining expansions, $2
million for Fadougou Village relocation costs and
$1 million for capitalized mobile
equipment rebuilds. Capital expenditures in the first-half of 2019
totaled $34 million mainly consisting
of $9 million for pre-stripping,
$7 million to complete relocation of
Fadougou Village, $5 million for
mining equipment, $5 million related
to the processing and mining expansions and $3 million for capitalized equipment
rebuilds.
For full-year 2019, the Fekola Mine production is expected to be
at the high end of its guidance range of between 420,000 and
430,000 ounces of gold at cash operating costs of between
$370 and $410 per ounce sold and AISC of between
$625 and $665 per ounce sold.
Fekola Mine Expansion
On March 26, 2019, the Company
announced very positive results from the Expansion Study PEA for
the Fekola Mine. As a result, the Company is proceeding with an
expansion project to increase processing throughput by 1.5 Mtpa to
7.5 Mtpa from an assumed base rate of 6 Mtpa. The PEA took into
account the significant increase in the Fekola Mineral Resource
announced on October 25, 2018. Based
on the PEA, once this expansion is complete, the Fekola Mine is
expected to produce more gold over a longer life, with more robust
economics and higher average annual gold production, revenues and
cash flows than the previous life-of-mine ("LoM"). Project economic
highlights from the PEA include: estimated optimized LoM extended
into 2030, including significant estimated increases in average
annual gold production to over 550,000 ounces per year during the
five-year period 2020-2024 and over 400,000 ounces per year over
the LoM (2019-2030), projected gold production of approximately
five million ounces over the new mine life of 12 years of mining
and processing (including 2019), an increase in project pre-tax net
present value of approximately $500
million versus the comparable amounts in the Company's
latest AIF Mineral Reserve LoM model (filed on SEDAR on
March 20, 2019) (assuming an
effective date of January 1, 2019, a
gold price of $1,300 per ounce and a
discount rate of 5%) and forecast LoM pre-tax net present value of
over $2.2 billion.
The processing upgrade will focus on increased ball mill power,
with upgrades to other components including a new cyclone
classification system, pebble crushers, and additional leach
capacity to support the higher throughput and increase operability.
The capital costs of this mill expansion are estimated to be
approximately $50 million, with
spending evenly split between 2019 and 2020. The mining rate at
Fekola will also be increased, along with additional mining
equipment to accelerate the supply of higher-grade ore to the
expanded processing facilities. Initial capital costs for the fleet
expansion are estimated at $85
million with $20 million
expected to be incurred in 2019 and the balance by the end of 2020.
Fleet costs are expected to be financed by equipment loans. Fekola
pit design, schedule, and costs will be refined in late 2019 and
early 2020, when updated resource and geotechnical models are
available.
Construction is scheduled to begin in October 2019 and be completed by the end of
July 2020. All major long-lead
equipment has been ordered. Detailed engineering and design
activities are progressing well and scheduled to be completed by
the end of September 2019.
Mineral Resources which are not Mineral Reserves do not have
demonstrated economic viability. The Expansion Study PEA is
preliminary in nature and includes Indicated and Inferred Mineral
Resources. Inferred Mineral Resources are considered too
speculative geologically to have economic considerations applied to
them that would enable them to be categorized as Mineral Reserves.
Consequently, there is no certainty that the Expansion Study PEA
will be realized.
Fekola Solar Plant
The Company completed a preliminary study to evaluate the
technical and economic viability of adding a solar plant to the
Fekola mine site. The results of that study indicated that it was a
very solid project and that a plant of approximately 30 megawatts
of solar generating capacity with a significant battery storage
component would provide the best economic result. A second study
has now been completed that has established the detailed capital
and operating cost analysis for the project. Results indicated that
a solar plant can provide significant operating cost reductions
(estimated to reduce processing costs by approximately 7%), and the
project was approved by the B2Gold Board in the second quarter of
2019.
The Fekola Solar Plant will be one of the largest off-grid
hybrid solar/heavy fuel oil ("HFO") plants in the world. It is
expected that it will allow for three HFO generators to be shut
down during daylight hours which will save about 13.1 million
litres of HFO per year, at a capital cost of approximately
$38 million, of which $20 million is expected to be incurred in 2019,
with the balance in 2020.
The Fekola Solar Plant is scheduled for completion in
August 2020 and has a four-year
payback.
Fadougou Village Relocation
In the second quarter of 2019, the Fadougou Village relocation
was completed (the original village of Fadougou was located
adjacent to the main Fekola open pit). Construction of the new
planned urban town commenced in late 2017 and was completed in
February 2019. This included building
over 700 new structures where all homes have solar panel lighting
and latrines. The Fadougou community started moving into their new
homes at New Fadougou in April 2019
and finished at the end of June 2019.
The mosque, school and clinic have been handed over to the
respective authorities and are fully operational. Training to
manage and maintain infrastructure, water supply systems and waste
disposal is ongoing.
Masbate Gold Mine - the
Philippines
The Masbate Mine in the
Philippines continued its very strong operational
performance through the second quarter of 2019, producing 57,572
ounces of gold, 7% (3,587 ounces) above budget and 6% (3,318
ounces) higher compared to the prior-year quarter. Gold production
was above budget largely due to higher-than-planned ore tonnage
sourced from the Main Vein Pit, including ore tonnage from
backfilled areas. The unbudgeted backfill material (that had
historically been mined using underground methods and was not
included in the budget mine plan) has higher grades and recoveries
than the planned mill feed.
Masbate's gold production for the quarter resulted from
processing 2.1 million tonnes (compared to budget of 2.0 million
tonnes and 1.7 million tonnes in the second quarter of 2018) at an
average grade of 1.22 g/t (compared to budget of 1.19 g/t and 1.29
g/t in the second quarter of 2018) with average gold recoveries of
70.2% (compared to budget of 69.6% and 77.3% in the second quarter
of 2018). Oxide ore represented 17% of the processed tonnage for
the quarter (versus budget of 1% and 59% in the second quarter of
2018). Mining activity was conducted mainly within Main Vein Pit
(recovering more high-grade and oxide ore tonnes at higher grade as
compared to the reserve model). Approval for the Montana Extension
Pit is well advanced, having successfully completed community
review and the receipt of the Environment Compliance Certificate.
All supporting infrastructure is in place and mining will commence
in the Montana Extension Pit as soon as the necessary approvals are
received (expected in the fourth quarter of 2019).
Masbate's second quarter cash operating costs were $570 per ounce produced ($566 per ounce sold) (Q2 2018 - $531 per ounce produced), well-below budget by
$64 per ounce (10%). The favourable
budget variance was driven by the above-budget gold production
together with lower-than-budgeted mining costs. Masbate's AISC for
the quarter were $749 per ounce sold
(Q2 2018 - $764 per ounce),
significantly below budget by $113
per ounce (13%), mainly due to higher-than-budgeted gold ounces
sold and lower-than-budgeted mining costs.
Year-to-date, the Masbate Mine achieved record half-yearly
production of 115,053 ounces of gold, significantly above budget by
11% (11,077 ounces) and 7% (7,652 ounces) higher than the
first-half of 2018.
Masbate's cash costs remained significantly below budget in the
first-half of the year with cash operating costs of $538 per ounce produced ($557 per ounce sold) (YTD 2018 - $537 per ounce produced), $113 per ounce (17%) below budget, and AISC of
$746 per ounce (YTD 2018 -
$750 per ounce), $166 per ounce (18%) below budget.
Capital expenditures for the second quarter of 2019 totaled
$8 million consisting mainly of
$2 million of mobile equipment
purchases and rebuilds, $1 million
for pre-stripping and $1 million to
complete the processing expansion project. For the first-half of
2019, capital expenditures totaled $16
million, including Masbate processing plant upgrade costs of
$5 million, mobile equipment
acquisition costs and rebuilds of $3
million, pre-stripping costs of $2
million and $2 million for the
tailings storage facility construction.
The Masbate expansion project for the upgrade of the processing
plant to 8.0 Mtpa was completed in early 2019. With the expansion
now fully commissioned and online, Masbate's annual gold production
is projected to average approximately 200,000 ounces per year
during the mining phase and above 100,000 ounces per year when the
low-grade stockpiles are processed in the subsequent period after
open-pit mining activities have ceased.
For full-year 2019, the Masbate Mine is expected to produce
between 200,000 and 210,000 ounces of gold, primarily from the Main
Vein Pit, at cash operating costs of between $625 and $665 per
ounce sold and AISC of between $860
and $900 per ounce sold.
Otjikoto Gold Mine - Namibia
The Otjikoto Mine in Namibia
also had a solid second quarter with gold production of 37,421
ounces (Q2 2018 - 40,678 ounces), 3% (1,045 ounces) above budget,
mainly due to slightly higher-than-budgeted throughput and
recoveries. As previously released, Otjikoto's full-year 2019 gold
production is scheduled to be significantly weighted towards the
second-half of the year, as a higher-grade zone of the Otjikoto Pit
is forecast to be processed in the third quarter of 2019 and
high-grade ore production from Phase 2 of the Wolfshag Pit is
scheduled to begin in late 2019. The Otjikoto Mine continued its
remarkable safety performance, extending the number of days without
an LTI to 488 days (3.8 million man-hours) at the end of the second
quarter of 2019.
During the second quarter of 2019, the Otjikoto Mine processed
0.87 million tonnes (compared to budget of 0.85 million tonnes and
0.86 million tonnes in the second quarter of 2018) at an average
grade of 1.36 g/t (compared to budget of 1.36 g/t and 1.49 g/t in
the second quarter of 2018) with average gold recoveries of 98.5%
(compared to budget of 98.0% and 98.7% in the second quarter of
2018).
For second quarter 2019, Otjikoto's cash operating costs were
$554 per ounce produced ($582 per ounce sold) (Q2 2018 - $505 per ounce produced), below budget by
$25 per ounce (4%), mainly due to
higher-than-budgeted gold production. Otjikoto's AISC for the
quarter were $1,174 per ounce sold
(Q2 2018 - $869 per ounce sold),
$57 per ounce (5%) below budget.
Compared to the prior-year quarter, AISC were significantly higher
mainly due to the timing of Otjikoto's pre-stripping activities
(relating to Phase 2 and 3 of the Wolfshag Pit). Otjikoto's AISC
per ounce are forecast to significantly decrease in the second-half
of 2019, mainly due to higher expected gold production in the
second-half and the timing of pre-stripping costs and equipment
rebuilds weighted towards the first-half of the
year.
For the first-half of 2019, the Otjikoto Mine produced 70,133
ounces of gold (YTD 2018 - 80,177 ounces), above budget by 3%
(2,320 ounces).
Year-to-date, Otjikoto's cash operating costs were $576 per ounce produced ($549 per ounce sold) (YTD 2018 - $536 per ounce), below budget by $38 per ounce (6%). Otjikoto's AISC were
$997 per ounce sold (YTD 2018 -
$793 per ounce sold), significantly
below budget by $184 per ounce (16%).
Otjikoto's AISC were lower-than-budget as a result of the
lower-than-budgeted cash operating costs, higher gold ounces sold
compared to budget and sustaining capital expenditures that were
$7 million lower-than-budgeted
(relating mainly to lower capitalized pre-stripping and is expected
to be an overall capital expenditure saving versus budget for the
year).
Capital expenditures in the second quarter of 2019 totaled
$17 million, mainly consisting of
$14 million for pre-stripping and
$2 million in mobile equipment
rebuilds and replacements. Capital expenditures for the six months
ended June 30, 2019 totaled
$25 million, mainly consisting of
$18 million for pre-stripping and
$6 million in mobile equipment
rebuilds and replacements.
For full-year 2019, the Otjikoto Mine is expected to produce
between 165,000 and 175,000 ounces of gold, primarily from the
Otjikoto Pit, at cash operating costs of between $520 and $560 per
ounce and AISC of between $905 and
$945 per ounce.
El Limon Gold Mine - Nicaragua
El Limon Mine in Nicaragua
produced 11,458 ounces of gold in the second quarter of 2019,
comparable to both budget and the prior-year quarter. Site
operations were generally on plan, with production from the new El
Limon Central Pit continuing along with production from the Santa
Pancha underground mine and development of the Veta Nueva
underground mine. As previously released, El Limon's full-year 2019
gold production is scheduled to be weighted towards the second-half
of the year, as high-grade ore production from the new Limon
Central Pit is scheduled to fully come online in the second-half of
2019.
Operationally, El Limon continues to improve. The final Forestry
Permits for Limon Central were delivered at the end of 2018, and
Limon Central development advanced quickly to produce ore early. By
June 2019, Limon Central Pit
development had reached the main ore body which immediately
provided a number of alternatives for ore blending and stockpiling
to optimize mill feed. The plant has continued to operate at
better-than-budget throughput, and better-than-planned recovery. El
Limon is well positioned to meet its production target in 2019.
For second quarter 2019, El Limon's cash operating costs were
$953 per ounce produced ($973 per ounce sold), below budget by
$44 per ounce (4%). El Limon's AISC
were $1,617 per ounce sold, above
budget by $263 per ounce (19%) mainly
attributable to the timing of gold sales and higher-than-budgeted
sustaining capital expenditures on Santa Pancha underground
development, resulting from a combination of higher-than-budgeted
underground metres developed and slightly higher power costs.
Development metres and associated costs are expected to be in-line
with budget through the remainder of 2019.
Year-to-date, El Limon Mine produced 23,689 ounces of gold (YTD
2018 - 24,638 ounces), in-line with budget.
For the first-half of 2019, El Limon's cash operating costs were
$916 per ounce produced ($983 per ounce sold), below budget by
$19 per ounce (2%), and AISC were
$1,567 per ounce sold, above budget
by $189 per ounce.
Total capital expenditures in the second quarter of 2019 were
$11 million, mainly consisting of
$6 million for Limon Central
pre-stripping and $4 million for
underground development at the Santa Pancha and Veta Nueva
underground mines. For the six months ended June 30, 2019, capital expenditures were
$18 million, mainly consisting of
$9 million for Limon Central
pre-stripping and $7 million for
Santa Pancha and Veta Nueva underground development.
For full-year 2019, El Limon is expected to produce between
55,000 and 60,000 ounces of gold at cash operating costs of between
$720 and $760 per ounce and AISC of between $1,005 and $1,045
per ounce.
La Libertad Gold Mine -
Nicaragua
La Libertad Mine in Nicaragua
produced 25,672 ounces of gold in the second quarter of 2019, 11%
(2,476 ounces) above budget and 20% (4,264 ounces) higher compared
to the prior-year quarter. The higher gold production was largely
due to higher-than-planned grade (from the San Juan and Mojon East
Pits and the Jabali underground mine). The head grade for the
quarter was 1.48 g/t versus a budget of 1.34 g/t and 1.25 g/t in
the prior-year quarter. La Libertad is on track to achieve its 2019
annual production guidance.
During the quarter, the Company received the mining permit for
the new Jabali Antenna open pit and has commenced construction of
roads and other related infrastructure. All necessary permits to
develop the Jabali Antenna open pit have now been received. The
Company anticipates that production will start from the Jabali
Antenna Pit in October 2019.
La Libertad Mine's second quarter cash operating costs were
$936 per ounce produced ($1,030 per ounce sold), $24 per ounce (3%) above budget. La Libertad's
AISC were $1,577 per ounce sold,
$352 per ounce (29%) above budget,
mainly attributable to the timing of gold sales and
higher-than-budgeted sustaining capital expenditures arising from
the catch up of Jabali Antenna open pit and underground development
expenditures originally budgeted for the first quarter of 2019
($2 million) and the construction of
the tailings storage facility ($4
million). The Company expects La Libertad's costs to decline
in the second-half of the year now that Jabali open-pit sources
have been secured and the major sustaining capital expenditures for
the year have been completed in the first-half of 2019.
Year-to-date, La Libertad Mine produced 43,758 ounces of gold,
in-line with budget and 7% (2,983 ounces) higher than in the
first-half of 2018.
For the first-half of 2019, La Libertad's cash operating costs
were $1,110 per ounce produced
($1,144 per ounce sold), $134 per ounce (14%) above budget, and AISC were
$1,607 per ounce sold, $113 per ounce above budget.
Total capital expenditures in the second quarter of 2019 were
$11 million, mainly consisting of
$8 million for tailings storage
facility construction and $2 million
for land purchase and resettlement related to the Jabali Antenna
open pit. For the six months ended June 30,
2019, capital expenditures totaled $15 million, mainly consisting of $11 million for tailings storage facility
construction and $3 million for land
purchase and resettlement related to the Jabali Antenna Pit.
For full-year 2019, La Libertad Mine is expected to produce
between 95,000 and 100,000 ounces of gold at cash operating costs
of between $840 and $880 per ounce and AISC of between $1,150 and $1,190
per ounce. Gold production is scheduled to be weighted towards the
second-half of the year with production from the new Jabali Antenna
open pit expected to begin in October
2019.
Outlook
The Company has recently commenced the mill expansion at the
Fekola Mine, which is expected to be completed early in the fourth
quarter of 2020 and to significantly increase annual gold
production and enhance the Fekola Mine economics. In addition,
infill drilling is ongoing on the Fekola North Extension to convert
inferred gold resources to indicated resources. Exploration in 2019
will continue to focus on drill testing Fekola, further to the
north, where it remains open, the new Cardinal zone west of Fekola
and underneath the Anaconda saprolite resource to the north. At the
Gramalote Project joint venture in Colombia (AngloGold Ashanti/B2Gold), the
companies are reviewing budgets to complete significant resource
infill drilling and advance permitting and feasibility work in
2019, and into 2020.
Looking forward through the balance of 2019 and beyond, B2Gold
plans to continue to maximize cash flows and maintain a strong
financial position by continuing the impressive operational and
financial performance from our existing mines, continue to reduce
overall debt levels, expand the Fekola Mine throughput and annual
gold production, pursue additional internal growth through further
exploration, development and expansion of existing projects, and
pursuit of greenfield exploration projects alone or in joint
ventures.
Qualified Persons
Peter D. Montano, P.E., the Project Director of B2Gold, a
qualified person under NI 43-101, has approved the scientific and
technical information related to operations matters contained in
this news release.
John Rajala, Vice President of
Metallurgy at B2Gold, a qualified person under NI 43-101, has
approved the scientific and technical information regarding
engineering matters related to Fekola expansion studies.
Second Quarter and First-half 2019 Financial Results -
Conference Call / Webcast Details
B2Gold executives will host a conference call to discuss the
results on Wednesday, August 7, 2019, at 10:00
am PDT/1:00 pm EDT. You may access the call by
dialing the operator at +1 647-788-4919 (local or international) or
toll free at +1 877-291-4570 prior to the scheduled start time or
you may listen to the call via webcast by clicking here:
https://www.investornetwork.com/event/presentation/50551. A
playback version will be available for two weeks after the call at
+1 416-621-4642 (local or international) or toll free at +1
800-585-8367 (passcode 9049769).
ON BEHALF OF B2GOLD CORP.
"Clive T.
Johnson"
President and Chief Executive Officer
For more information on B2Gold please visit the Company website
at www.b2gold.com or contact:
Ian
MacLean
|
Katie
Bromley
|
Vice President,
Investor Relations
|
Manager, Investor
Relations & Public Relations
|
604-681-8371
|
604-681-8371
|
imaclean@b2gold.com
|
kbromley@b2gold.com
|
The Toronto Stock Exchange and NYSE American LLC
neither approve nor disapprove the information
contained in this news release.
Production results and production guidance presented in this
news release reflect total production at the mines B2Gold operates
on a 100% project basis. Please see our Annual Information
Form dated March 19, 2019 for a
discussion of our ownership interest in the mines B2Gold
operates.
This news release includes certain "forward-looking
information" and "forward-looking statements" (collectively
"forward-looking statements") within the meaning of applicable
Canadian and United States
securities legislation, including: projections; outlook; guidance;
forecasts; estimates; and other statements regarding future or
estimated financial and operational performance events, gold
production and sales, revenues and cash flows, capital and
operating costs, including projected cash operating costs and AISC,
and budgets; statements regarding future or estimated mine life,
metal price assumptions, ore grades or sources, stripping ratios,
throughput, ore processing; statements regarding anticipated
exploration, drilling, development, construction, permitting and
other activities or achievements of B2Gold; and including, without
limitation: B2Gold remaining well positioned for continued strong
operational and financial performance for the full-year of 2019;
the potential entering into a definitive agreement by B2Gold and
Calibre in respect of the proposed sale of the Nicaraguan Assets to
Calibre or the expected timing for the completion of the
transaction; the closing of the concurrent private placement by
Calibre; B2Gold's future equity interest in Calibre; B2Gold's
future involvement with the Nicaraguan operations; B2Gold's
anticipated participation in an Advisory Board to the main board of
Calibre; the results of the Fekola PEA; the Fekola expansion being
expected to increase life-of-mine to 2030 and project pre-tax net
present value, increase processing throughput and produce more gold
over a longer life with more robust economics and higher average
gold production, revenues and cash flows than the previous
life-of-mine and the timing of such expansion, including the
anticipated timing and completion date for the construction of the
processing upgrade and for the engineering and design activities;
the anticipated cost and timing for the addition of a solar plant
to the Fekola Mine and the key aspects of such proposed solar
plant; the anticipated timing for the start of production from the
Jabali Antenna Pit; the estimated capital cost of the Fekola
expansion; production at the Masbate Mine being projected to
average approximately 200,000 ounces per year during the mining
phase and above 100,000 ounces per year when the low-grade
stockpiles are processed at the end of the open-pit mine life; the
anticipated timing for the issuance of a permit for the Montana Pit
Extension at the Masbate Mine; higher-grade
zone of the Otjikoto Pit being forecast to be processed in the
third quarter of 2019; high-grade ore production from Phase 2 of
the Wolfshag Pit being scheduled to begin in late 2019; high-grade
ore production from the new Limon Central Pit being scheduled to
commence at the beginning of the second-half of 2019; B2Gold's
consolidated gold production and the gold production at each of the
Fekola Mine, La Libertad, Otjikoto Mine and El Limon being weighted
in the second-half of 2019; B2Gold's forecast that it will
meet the low end of the Company's consolidated
production guidance ranges for 2019 and that it will meet the
Company's 2019 consolidated cash cost and all-in
sustaining guidance ranges; and B2Gold remaining
focused on continuing to reduce overall debt levels, expand the
Fekola Mine throughput and annual gold production, pursue
additional internal growth through further exploration, development
and expansion of existing projects, and pursuit of greenfield
exploration projects alone or in joint ventures.
Estimates of mineral resources and reserves are also
forward-looking statements because they constitute projections
regarding the amount of minerals that may be encountered in the
future and/or the anticipated economics of production, should a
production decision be made. All statements in this news release
that address events or developments that we expect to occur in the
future are forward-looking statements. Forward-looking statements
are statements that are not historical facts and are generally,
although not always, identified by words such as "expect", "plan",
"anticipate", "project", "target", "potential", "schedule",
"forecast", "budget", "estimate", "intend" or "believe" and similar
expressions or their negative connotations, or that events or
conditions "will", "would", "may", "could", "should" or "might"
occur. All such forward-looking statements are based on the
opinions and estimates of management as of the date such statements
are made.
Forward-looking statements necessarily involve
assumptions, risks and uncertainties, certain of which are beyond
B2Gold's control, including risks associated with or related to:
the completion of satisfactory due diligence by Calibre; the
successful negotiation and execution of a definitive agreement by
B2Gold and Calibre; all requisite regulatory, third party and/or
shareholder approval will be obtained from all applicable parties
and all other conditions to the completion of the sale of the
Nicaraguan Assets to Calibre will be satisfied or waived; the
volatility of metal prices and B2Gold's common shares; changes in
tax laws; the dangers inherent in exploration, development and
mining activities; the uncertainty of reserve and resource
estimates; not achieving production, cost or other estimates;
actual production, development plans and costs differing materially
from the estimates in B2Gold's feasibility studies; the ability to
obtain and maintain any necessary permits, consents or
authorizations required for mining activities; the current ongoing
instability in Nicaragua and the
ramifications thereof; environmental regulations or hazards and
compliance with complex regulations associated with mining
activities; climate change and climate change regulations; the
ability to replace mineral reserves and identify acquisition
opportunities; the unknown liabilities of companies acquired by
B2Gold; the ability to successfully integrate new acquisitions;
fluctuations in exchange rates; the availability of financing;
financing and debt activities, including potential restrictions
imposed on B2Gold's operations as a result thereof and the ability
to generate sufficient cash flows; operations in foreign and
developing countries and the compliance with foreign laws,
including those associated with operations in Mali, Namibia, the
Philippines, Nicaragua and
Burkina Faso and including risks
related to changes in foreign laws and changing policies related to
mining and local ownership requirements or resource nationalization
generally; remote operations and the availability of adequate
infrastructure; fluctuations in price and availability of energy
and other inputs necessary for mining operations; shortages or cost
increases in necessary equipment, supplies and labour; regulatory,
political and country risks, including local instability or acts of
terrorism and the effects thereof; the reliance upon contractors,
third parties and joint venture partners; the lack of sole
decision-making authority related to Filminera Resources
Corporation, which owns the Masbate Project; challenges to title or
surface rights; the dependence on key personnel and the ability to
attract and retain skilled personnel; the risk of an uninsurable or
uninsured loss; adverse climate and weather conditions; litigation
risk; competition with other mining companies; community support
for B2Gold's operations, including risks related to strikes and the
halting of such operations from time to time; conflicts with small
scale miners; failures of information systems or information
security threats; the final outcome of the audit by the Philippines
Department of Environment and Natural Resources in relation to the
Masbate Project; the ability to maintain adequate internal controls
over financial reporting as required by law, including Section 404
of the Sarbanes-Oxley Act; compliance with anti-corruption laws,
and sanctions or other similar measures; social media and B2Gold's
reputation; as well as other factors identified and as described in
more detail under the heading "Risk Factors" in B2Gold's most
recent Annual Information Form, B2Gold's current Form 40-F Annual
Report and B2Gold's other filings with Canadian securities
regulators and the U.S. Securities and Exchange Commission (the
"SEC"), which may be viewed at www.sedar.com and www.sec.gov,
respectively (the "Websites"). The list is not
exhaustive of the factors that may affect B2Gold's forward-looking
statements.
B2Gold's forward-looking statements are based on the
applicable assumptions and factors management considers reasonable
as of the date hereof, based on the information available to
management at such time. These assumptions and factors include, but
are not limited to, assumptions and factors related to B2Gold's
ability to carry on current and future operations, including:
development and exploration activities; the timing, extent,
duration and economic viability of such operations, including any
mineral resources or reserves identified thereby; the accuracy and
reliability of estimates, projections, forecasts, studies and
assessments; B2Gold's ability to meet or achieve estimates,
projections and forecasts; the availability and cost of inputs; the
price and market for outputs, including gold; the timely receipt of
necessary approvals or permits; the ability to meet current and
future obligations; the ability to obtain timely financing on
reasonable terms when required; the current and future social,
economic and political conditions; and other assumptions and
factors generally associated with the mining industry.
B2Gold's forward-looking statements are based on the opinions
and estimates of management and reflect their current expectations
regarding future events and operating performance and speak only as
of the date hereof. B2Gold does not assume any
obligation to update forward-looking statements if circumstances or
management's beliefs, expectations or opinions should change other
than as required by applicable law. There can be no assurance
that forward-looking statements will prove to be
accurate, and actual results, performance or achievements could
differ materially from those expressed in, or implied by, these
forward-looking statements. Accordingly, no assurance can be given
that any events anticipated by the forward-looking statements will
transpire or occur, or if any of them do, what benefits or
liabilities B2Gold will derive therefrom. For the reasons set forth
above, undue reliance should not be placed on forward-looking
statements.
Non-IFRS Measures
This news release
includes certain terms or performance measures commonly used in the
mining industry that are not defined under International Financial
Reporting Standards ("IFRS"), including "cash operating costs" and
"all-in sustaining costs" (or "AISC"). Non-IFRS measures do not
have any standardized meaning prescribed under IFRS, and therefore
they may not be comparable to similar measures employed by other
companies. The data presented is intended to provide additional
information and should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
IFRS and should be read in conjunction with B2Gold's consolidated
financial statements. Readers should refer to B2Gold's Management
Discussion and Analysis, available on the Websites, under the
heading "Non-IFRS Measures" for a more detailed discussion of how
B2Gold calculates certain of such measures and a reconciliation of
certain measures to IFRS terms.
Cautionary Note to United States
Investors
The disclosure in this news release was
prepared in accordance with Canadian National Instrument 43-101
("NI 43-101"), which differs significantly from the current
requirements of the SEC set out in Industry Guide 7. Accordingly,
such disclosure may not be comparable to similar information made
public by companies that report in accordance with Industry Guide
7. In particular, this news release may refer to "mineral
resources," "indicated mineral resources" or "inferred mineral
resources". While these categories of mineralization are recognized
and required by Canadian securities laws, they are not recognized
by Industry Guide 7 and are not normally permitted to be disclosed
in SEC filings by U.S. companies. U.S. investors are cautioned not
to assume that any part of a "mineral resource," "indicated mineral
resource" or "inferred mineral resource" will ever be converted
into a "reserve." In addition, this news release uses the terms
"reserves" and "mineral reserves" which are reported by the Company
under Canadian standards and may not qualify as reserves under
Industry Guide 7. Under Industry Guide 7, mineralization may not be
classified as a "reserve" unless the mineralization can be
economically and legally extracted or produced at the time the
"reserve" determination is made. Accordingly, information contained
or referenced in this news release containing descriptions of the
Company's mineral deposits may not be compatible to similar
information made public by U.S. companies subject to the reporting
and disclosure requirements of Industry Guide 7. "Inferred mineral
resources" have a great amount of uncertainty as to their existence
and great uncertainty as to their economic and legal feasibility.
It cannot be assumed that all or any part of an inferred mineral
resource will ever be upgraded to a higher category. Disclosure of
"contained ounces" in a resource is permitted disclosure under
Canadian reporting standards; however, Industry Guide 7 normally
only permits issuers to report mineralization that does not
constitute "reserves" by Industry Guide 7 standards as in-place
tonnage and grade without reference to unit measures. Further,
while NI 43-101 permits companies to disclose economic projections
contained in preliminary economic assessments and pre-feasibility
studies, which are not based on "reserves", U.S. companies have not
generally been permitted to disclose economic projections for a
mineral property in their SEC filings prior to the establishment of
"reserves." Historical results or feasibility models presented
herein are not guarantees or expectations of future
performance.
B2GOLD CORP.
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED JUNE
30
(Expressed in thousands of United
States dollars, except per share amounts)
(Unaudited)
|
For the
three
months ended
June 30, 2019
|
For the
three
months ended
June 30, 2018
|
|
For the
six
months ended
June 30, 2019
|
For the
six
months ended
June 30, 2018
|
|
|
|
|
|
|
Gold
revenue
|
$
|
267,213
|
$
|
242,311
|
|
$
|
531,195
|
$
|
540,470
|
|
|
|
|
|
|
Cost of
sales
|
|
|
|
|
|
Production
costs
|
(95,313)
|
(78,667)
|
|
(188,150)
|
(168,534)
|
Depreciation and
depletion
|
(56,981)
|
(55,743)
|
|
(117,612)
|
(119,250)
|
Royalties and
production taxes
|
(17,552)
|
(17,123)
|
|
(35,506)
|
(36,373)
|
Total cost of
sales
|
(169,846)
|
(151,533)
|
|
(341,268)
|
(324,157)
|
|
|
|
|
|
|
Gross
profit
|
97,367
|
90,778
|
|
189,927
|
216,313
|
|
|
|
|
|
|
General and
administrative
|
(11,662)
|
(9,638)
|
|
(26,448)
|
(20,427)
|
Share-based
payments
|
(6,054)
|
(2,472)
|
|
(10,036)
|
(5,843)
|
Impairment of
long-lived assets
|
—
|
—
|
|
—
|
(18,186)
|
Write-down of mineral
property interests
|
(1,352)
|
—
|
|
(1,352)
|
—
|
Recovery of
(provision for) non-recoverable input taxes
|
505
|
228
|
|
555
|
(391)
|
Foreign exchange
(losses) gains
|
(76)
|
1,934
|
|
1,250
|
1,797
|
Other
|
309
|
(1,257)
|
|
(38)
|
(1,990)
|
Operating
income
|
79,037
|
79,573
|
|
153,858
|
171,273
|
|
|
|
|
|
|
Unrealized gain on
fair value of convertible notes
|
—
|
878
|
|
—
|
12,092
|
Community
relations
|
(465)
|
(521)
|
|
(1,143)
|
(1,449)
|
Interest and
financing expense
|
(7,078)
|
(8,215)
|
|
(14,517)
|
(16,303)
|
(Loss) gain on
derivative instruments
|
(2,914)
|
5,091
|
|
3,332
|
8,119
|
Other
|
(437)
|
(271)
|
|
(503)
|
(325)
|
Income from
continuing operations before taxes
|
68,143
|
76,535
|
|
141,027
|
173,407
|
|
|
|
|
|
|
Current income tax,
withholding and other taxes
|
(24,123)
|
(21,863)
|
|
(49,692)
|
(59,999)
|
Deferred income tax
recovery (expense)
|
971
|
(27,131)
|
|
(11,099)
|
(19,649)
|
Net income from
continuing operations
|
44,991
|
27,541
|
|
80,236
|
93,759
|
|
|
|
|
|
|
Loss from
discontinued operations
|
(3,669)
|
(6,208)
|
|
(12,391)
|
(14,998)
|
Net income for the
period
|
$
|
41,322
|
$
|
21,333
|
|
$
|
67,845
|
$
|
78,761
|
|
|
|
|
|
|
Attributable
to:
|
|
|
|
|
|
Shareholders of the
Company
|
$
|
37,904
|
$
|
20,806
|
|
$
|
60,199
|
$
|
77,288
|
Non-controlling
interests
|
3,418
|
527
|
|
7,646
|
1,473
|
Net income for the
period
|
$
|
41,322
|
$
|
21,333
|
|
$
|
67,845
|
$
|
78,761
|
|
|
|
|
|
|
Earnings per share
from continuing operations
(attributable to
shareholders of the Company)
|
|
|
|
|
|
Basic
|
$
|
0.04
|
$
|
0.03
|
|
$
|
0.07
|
$
|
0.09
|
Diluted
|
$
|
0.04
|
$
|
0.02
|
|
$
|
0.07
|
$
|
0.08
|
|
|
|
|
|
|
Earnings per
share
(attributable to
shareholders of the Company)
|
|
|
|
|
|
Basic
|
$
|
0.04
|
$
|
0.02
|
|
$
|
0.06
|
$
|
0.08
|
Diluted
|
$
|
0.04
|
$
|
0.02
|
|
$
|
0.06
|
$
|
0.06
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding
(in
thousands)
|
|
|
|
|
|
Basic
|
1,008,345
|
984,650
|
|
1,004,897
|
983,412
|
Diluted
|
1,016,322
|
1,063,853
|
|
1,014,725
|
1,063,095
|
B2GOLD CORP.
CONDENSED INTERIM CONSOLIDATED
STATEMENTS OF CASH FLOWS
FOR THE THREE AND SIX MONTHS
ENDED JUNE 30
(Expressed in
thousands of United States
dollars)
(Unaudited)
|
For the
three
months ended
June 30, 2019
|
For the
three
months ended
June 30, 2018
|
|
For the
six
months ended
June 30, 2019
|
For the
six
months ended
June 30, 2018
|
Operating
activities
|
|
|
|
|
|
Net income for the
period from continuing operations
|
$
|
44,991
|
$
|
27,541
|
|
$
|
80,236
|
$
|
93,759
|
Mine restoration
provisions settled
|
—
|
—
|
|
(124)
|
—
|
Non-cash charges,
net
|
62,267
|
71,341
|
|
119,290
|
128,463
|
Changes in non-cash
working capital
|
(25,632)
|
(14,712)
|
|
(30,739)
|
(1,187)
|
Changes in long-term
value added tax receivables
|
1,756
|
(4,067)
|
|
(83)
|
(2,746)
|
Cash provided by
operating activities of continuing
operations
|
83,382
|
80,103
|
|
168,580
|
218,289
|
Cash provided by
operating activities of discontinued
operations
|
9,434
|
6,108
|
|
10,654
|
15,198
|
Cash provided by
operating activities
|
92,816
|
86,211
|
|
179,234
|
233,487
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
|
Revolving credit
facility, drawdowns net of transaction costs
|
(5,574)
|
25,000
|
|
(5,574)
|
25,000
|
Repayment of
revolving credit facility
|
(25,000)
|
(75,000)
|
|
(25,000)
|
(150,000)
|
Equipment loan
facilities, drawdowns net of transaction costs
|
3,463
|
3,554
|
|
3,463
|
28,848
|
Repayment of
equipment loan facilities
|
(10,067)
|
(10,155)
|
|
(12,379)
|
(13,172)
|
Interest and
commitment fees paid
|
(6,499)
|
(13,999)
|
|
(12,269)
|
(20,872)
|
Common shares issued
for cash on exercise of stock options
|
7,005
|
5,032
|
|
28,170
|
9,907
|
Principal payments on
lease arrangements
|
(744)
|
—
|
|
(1,501)
|
—
|
Restricted cash
movement
|
(398)
|
39
|
|
(1,254)
|
(1,379)
|
Other
|
—
|
(220)
|
|
—
|
(220)
|
Cash used by
financing activities of continuing operations
|
(37,814)
|
(65,749)
|
|
(26,344)
|
(121,888)
|
Cash used by
financing activities of discontinued operations
|
(99)
|
(181)
|
|
(282)
|
(620)
|
Cash provided used
by financing activities
|
(37,913)
|
(65,930)
|
|
(26,626)
|
(122,508)
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
|
Expenditures on
mining interests:
|
|
|
|
|
|
Fekola
Mine
|
(12,829)
|
(15,322)
|
|
(34,113)
|
(36,409)
|
Masbate
Mine
|
(7,520)
|
(9,560)
|
|
(15,964)
|
(21,397)
|
Otjikoto
Mine
|
(17,221)
|
(18,256)
|
|
(24,503)
|
(29,632)
|
Gramalote
Project
|
(614)
|
(2,041)
|
|
(1,802)
|
(4,477)
|
Other exploration and
development
|
(12,563)
|
(15,050)
|
|
(19,184)
|
(26,095)
|
Other
|
553
|
(42)
|
|
402
|
(70)
|
Cash used by
investing activities of continuing operations
|
(50,194)
|
(60,271)
|
|
(95,164)
|
(118,080)
|
Cash used by
investing activities of discontinued operations
|
(23,164)
|
(19,323)
|
|
(36,691)
|
(32,513)
|
Cash used by
investing activities
|
(73,358)
|
(79,594)
|
|
(131,855)
|
(150,593)
|
|
|
|
|
|
|
(Decrease)
increase in cash and cash equivalents
|
(18,455)
|
(59,313)
|
|
20,753
|
(39,614)
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
638
|
(1,651)
|
|
261
|
(902)
|
Cash and cash
equivalents, beginning of period
|
141,583
|
167,916
|
|
102,752
|
147,468
|
Less cash
associated with discontinued operations, end of
period
|
(10,245)
|
(10,913)
|
|
(10,245)
|
(10,913)
|
Cash and cash
equivalents, end of period
|
$
|
113,521
|
$
|
96,039
|
|
$
|
113,521
|
$
|
96,039
|
B2GOLD CORP.
CONDENSED INTERIM CONSOLIDATED BALANCE
SHEETS
(Expressed in thousands of United States dollars)
(Unaudited)
|
|
|
|
|
|
As at June
30,
2019
|
As at December
31,
2018
|
Assets
|
|
|
|
|
|
|
|
Current
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
|
|
|
$
|
113,521
|
$
|
102,752
|
Accounts receivable,
prepaids and other
|
|
|
|
|
|
15,442
|
12,651
|
Value-added and other
tax receivables
|
|
|
|
|
|
13,927
|
13,657
|
Inventories
|
|
|
|
|
|
194,864
|
233,971
|
Assets classified as
held for sale
|
|
|
|
|
|
166,452
|
—
|
|
|
|
|
|
|
504,206
|
363,031
|
|
|
|
|
|
|
|
|
Long-term
investments
|
|
|
|
|
|
5,517
|
4,155
|
Value-added tax
receivables
|
|
|
|
|
|
20,580
|
22,185
|
Mining
interests
|
|
|
|
|
|
|
|
Owned by
subsidiaries
|
|
|
|
|
|
1,942,349
|
2,035,097
|
Investments in joint
ventures
|
|
|
|
|
|
73,880
|
72,078
|
Other
assets
|
|
|
|
|
|
45,854
|
40,351
|
Deferred income
taxes
|
|
|
|
|
|
3,725
|
10,907
|
|
|
|
|
|
|
$
|
2,596,111
|
$
|
2,547,804
|
Liabilities
|
|
|
|
|
|
|
|
Current
|
|
|
|
|
|
|
|
Accounts payable and
accrued liabilities
|
|
|
|
|
|
$
|
61,720
|
$
|
80,318
|
Current income and
other taxes payable
|
|
|
|
|
|
56,737
|
66,904
|
Current portion of
long-term debt
|
|
|
|
|
|
26,470
|
25,008
|
Current portion of
prepaid sales
|
|
|
|
|
|
—
|
30,000
|
Current portion of
mine restoration provisions
|
|
|
|
|
|
—
|
3,170
|
Other current
liabilities
|
|
|
|
|
|
1,047
|
1,850
|
Liabilities
associated with assets held for sale
|
|
|
|
|
|
86,385
|
—
|
|
|
|
|
|
|
232,359
|
207,250
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
|
|
|
|
420,616
|
454,527
|
Mine restoration
provisions
|
|
|
|
|
|
73,680
|
114,051
|
Deferred income
taxes
|
|
|
|
|
|
99,997
|
103,384
|
Employee benefits
obligation
|
|
|
|
|
|
4,262
|
12,063
|
Other long-term
liabilities
|
|
|
|
|
|
4,352
|
3,676
|
|
|
|
|
|
|
835,266
|
894,951
|
Equity
|
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
|
|
Share
capital
|
|
|
|
|
|
|
|
Issued: 1,009,933,091 common
shares (Dec 31, 2018 – 994,621,917)
|
|
|
|
|
|
2,273,764
|
2,234,050
|
Contributed
surplus
|
|
|
|
|
|
69,700
|
70,889
|
Accumulated other
comprehensive loss
|
|
|
|
|
|
(144,791)
|
(146,153)
|
Deficit
|
|
|
|
|
|
(485,914)
|
(547,839)
|
|
|
|
|
|
|
1,712,759
|
1,610,947
|
Non-controlling
interests
|
|
|
|
|
|
48,086
|
41,906
|
|
|
|
|
|
|
1,760,845
|
1,652,853
|
|
|
|
|
|
|
$
|
2,596,111
|
$
|
2,547,804
|
|
|
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/b2gold-reports-strong-second-quarter-2019-results-record-quarterly-gold-production-of-246-000-oz-8-above-budget-beat-against-budget-for-cash-operating-costs-and-aisc-300897687.html
SOURCE B2Gold Corp.