TIDMCAPD
RNS Number : 4964V
Capital Limited
15 April 2021
For Immediate Release 15 April 2021
Capital Limited
("Capital", the "Group" or the "Company")
Q1 2021 Trading Update
Capital (LSE: CAPD), a leading mining services company focused
on the African markets, today provides its Q1 2021 trading update
for the period ended 31 March 2021 (the "Period").
FIRST QUARTER (Q1) 2021 KEY METRICS
Q1 2021 Q1 2020 Q4 2020 % change % change
from from
Q1 2020 Q4 2020
-------------------- --------- --------- --------- ---------- ----------
Revenue (US$m) 44.0 32.5 34.6 35.4% 27.2%
-------------------- --------- --------- --------- ---------- ----------
ARPOR*(US$) 180,000 170,000 172,000 5.9% 4.7%
-------------------- --------- --------- --------- ---------- ----------
Average utilised
rigs 64 56 56 14.3% 14.3%
-------------------- --------- --------- --------- ---------- ----------
Fleet Utilisation
(%) 67% 57% 59% 17.5% 13.6%
-------------------- --------- --------- --------- ---------- ----------
Average Fleet 95 98 95 -3.1% 0.0%
-------------------- --------- --------- --------- ---------- ----------
Closing fleet
size 98 99 94 -1.0% 4.3%
-------------------- --------- --------- --------- ---------- ----------
* Average monthly revenue per operating rig
Financial Highlights
-- Revenue US$44.0 million, a 35.4% increase on Q1 2020 (US$32.5
million) and a 27.2% increase on Q4 2020 (US$34.6 million), the
strongest quarterly revenue performance since the Company's
inception;
-- Mine-site services continue to underpin revenue streams, contributing 87% of Group revenue;
-- Strong growth in non-drilling revenue contribution (21% of
total revenue) compared with Q1 2020 (12%), driven by MSALABS, Well
Force and Mining Services;
-- West African region contributed 37% to Group revenues in Q1,
a 15% increase compared to Q1 2020 (32%) and a 95% increase since
commencing the strategic relocation of assets in Q1 2018 (19%);
-- Average monthly revenue per operating rig ("ARPOR") increased
4.7% (US$180,000) on Q4 2020 (US$172,000) attributed to
strengthening revenue contributions from new contracts (Predictive,
Firefinch and Oriole), together with improved performance at
long-term contracts (Centamin, Hummingbird and Resolute); and
-- Declared a final dividend of US 1.3 cps for the 2020
financial year (2019: US 0.7 cps), payable 4 May 2021.
Operational Highlights
-- Fleet Utilisation increased to 67%, an increase of 17.5% on
Q1 2020 (57%) and 13.6% on Q4 2020 (59%) driven by start-up of new
contracts;
-- MSM, our fledgling maintenance business, awarded two-year
complete hydraulic hose services contract with Resolute at the
Syama Gold Mine, Mali;
-- New exploration & delineation contracts awarded
(previously announced) during the quarter include:
- Initial six-month delineation drilling contract for Allied Gold Corp, Mali;
- Exploration drilling contract for new client Cora Gold, Mali;
- Exploration drilling contract with Perseus Mining in Côte d'Ivoire;
- Initial six-month delineation drilling contract with Aya Gold
and Silver Inc in Mauritania; and
- Six-month exploration drilling contract for Endeavour Mining Corporation, Burkina Faso.
-- Transformational Sukari waste mining contract progressing well, highlights include:
- Q1 asset commissioning completed marginally ahead of schedule
with the second phase of equipment commissioning on track for
completion early Q2;
- Earth moving operations commenced in February; and
- Substantial progress on recruitment with approximately 70% of
planned workforce hired during the quarter.
-- Achieved a number of safety milestones during the quarter, including:
- Mwanza facility (Tanzania) achieved thirteen years LTI free in January;
- Yanfolila Gold Mine (Mali, Hummingbird) achieved three years LTI free in January;
- Bamako facility (Mali, Allied Gold) achieved three years LTI free in January;
- Bulyanhulu Gold Mine (Tanzania, Barrick) achieved one year LTI free in January;
- Bonikro Gold Mine (Côte d'Ivoire, Allied Gold) achieved one year LTI free in January;
- North Mara Gold Mine (Tanzania, Barrick) achieved five years LTI free in March; and
- Geita Gold Mine (Tanzania, AngloGold Ashanti) achieved four years LTI free in March.
-- The Group's expanded portfolio of ten long-term mine-site
based contracts continue to perform well; and
-- Rig count increased from 94 (31 December 2020) to 98, with
the acquisition and commissioning of three new rigs to support the
Sukari contract in (Egypt) and a further new rig to support the
Cora Gold contract (Mali).
Outlook
-- Q1 delivered the highest quarterly revenues since the
company's inception, with revenue growth delivered across all
business units;
-- Expanded budgets within the exploration drilling market,
creating significant tailwinds for the exploration fleet which
contributed strongly to overall rig utilisation;
-- Capital Limited is currently experiencing the strongest
demand environment for drilling services in a decade;
-- Current gold price levels remain supportive for Capital, with
c.90% of revenue exposure to the African gold sector, and other
commodity prices, driven by energy metals, have also continued to
increase strongly during Q1;
-- Tendering market across all businesses continues to be highly active; and
-- Revenue guidance for 2021 remains $185 to $195 million
(compared to FY2020 revenues of $135 million), driven by higher
drill rig utilisation, new contracts and contract extensions and
the commencement of the load and haul waste mining contract at
Sukari, Egypt.
Commenting on the trading update, Jamie Boyton, Executive
Chairman, said:
'The first quarter of 2021 has been the strongest revenue
performance in Capital's history, underpinned by significant demand
for drilling services in particular, and supported by growth in the
Company's non-drilling services. Capital's strategy of diversifying
its revenue streams through significant expansion into the fast
growth West African drilling services market, as well as the
generating of significant momentum in its contract mining, MSLABS
and maintenance operations, continues to deliver strong returns for
our stakeholders. Of particular note is our continued excellence in
safety, particularly during a period which has seen unprecedented
mobilisation and start-up operations in a number of mine sites
across our blue-chip client mine sites.
Looking ahead and having been awarded a number of new contracts
with both new and existing customers in West Africa, our rig
utilisation is expected to remain strong. The execution of the
early stages of the Sukari contracts for the waste stripping and
additional drilling contracts is progressing well with revenue
growth contribution set to accelerate through 2021, reaching full
run rate in Q4.'
- ENDS -
For further information, please visit Capital's website
www.capdrill.com or contact:
Capital Limited +230 464 3250
Jamie Boyton, Executive Chairman investor@capdrill.com
Giles Everist, Chief Financial Officer
Rick Robson, Executive - Corporate Development
Berenberg +44 20 3207 7800
Matthew Armitt
Jennifer Wyllie
Detlir Elezi
Tamesis Partners LLP +44 20 3882 2868
Charlie Bendon
Richard Greenfield
Buchanan +44 20 7466 5000
Bobby Morse capital@buchanan.uk.com
Kelsey Traynor
James Husband
About Capital Limited
Capital Limited is a leading mining services company providing a
complete range of drilling, mining, maintenance and geochemical
laboratory solutions to customers within the global minerals
industry, focusing on the African markets. The Company's services
include: exploration, delineation and production drilling; load and
haul services; mining equipment hire and maintenance; and
geochemical analysis. The Group's corporate headquarters are in
Mauritius and it has established operations in Burkina Faso,
Cameroon, Côte d'Ivoire, Egypt, Guinea, Mali, Mauritania, Nigeria,
Saudi Arabia and Tanzania.
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