TIDMCMCL
RNS Number : 9278S
Caledonia Mining Corporation PLC
22 March 2021
Caledonia Mining Corporation Plc
Results for the Year ended December 31, 2020 and Notice of a
Management Conference Call
(NYSE AMERICAN: CMCL; AIM: CMCL)
March 22(nd) , 2021
Caledonia Mining Corporation Plc ("Caledonia" or the "Company")
announces its operating and financial results for the year ended
December 31, 2020 (the "Year"). Further information on the
financial and operating results for the Year and the quarter ended
December 31, 2020 (the "Quarter" or "Q4") can be found in the
Management Discussion and Analysis ("MD&A") and the audited
financial statements which are available on the Company's website
and which are filed on SEDAR.
2020 Financial Highlights
-- Gross revenues of $100 million (2019: $75.8 million).
-- Gross profit of $46.6 million (2019: $31.1 million) at a
gross margin of 47 per cent (2019: 41 per cent).
-- EBITDA of $43.3 million (2019: $29.9 million) at a margin of 43 per cent (2019: 39 per cent).
-- On-mine cost(1) of $744 per ounce (2019: $651 per ounce).
-- Normalised all-in sustaining cost(1) (i.e. excluding the
effect of the export credit incentive and its successor scheme) of
$946 per ounce (2019: $820 per ounce).
-- Adjusted earnings per share(1) of 204 cents (2019: 145 cents).
-- Net cash from operating activities of $30.9 million (2019: $18.1 million).
-- Net cash and cash equivalents of $19.1 million (2019: $8.9
million). Cash position increased due to a $13 million (gross)
equity issue in the third quarter of 2020.
-- Total dividend paid of 33.5 cents per share, a 21.8 per cent increase from 2019.
(1) 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 .
Operating Highlights
-- 57,899 ounces of gold produced in the Year (2019: 55,182
ounces); record annual production at Blanket Mine.
-- Gold recoveries have improved following the completion of the
upgrade to the oxygen plant in the Year: gold recovery in the Year
was 93.8 per cent (2019: 93.4 per cent).
-- Equipping the Central Shaft was completed in November 2020
and commissioning expected in first quarter 2021.
-- Increased awareness in safety procedures has led to a 60 per
cent reduction in total accidents from 2017 to 2020.
-- Entered into option agreements on two properties, Glen Hume
and Connemara North, in the Gweru mining district in the Zimbabwe
Midlands for the right to explore each property for periods of 15
and 18 months respectively.
Post Year-End Highlights and Outlook
-- Quarterly dividend increased by 10 per cent to 11 cents per
share in January 2021, a 60 per cent cumulative increase from the
level of 6.875 cents since October 2019. This is due to Caledonia's
improved financial and operating performance and the enhanced
outlook as the Company approaches the end of the Central Shaft
project.
-- 2021 gold production guidance of between 61,000 - 67,000 ounces.
-- Central Shaft commissioning is expected in the first quarter
of 2021 after which production is expected to begin to ramp up to
approximately 80,000 ounces in 2022.
Conference Call
Management will host a conference call on 25(th) March to
discuss the results for 2020 and the outlook for the Company. The
details for this call are set out towards the end of this
announcement.
There will also be a Results presentation video with Management
that will be available on the Caledonia website at
https://www.caledoniamining.com/media/#corpvideos
Steve Curtis, Chief Executive Officer, commented:
"Operationally, the last 12 months have been transformational
for the business. Central Shaft has been a five-year project
costing approximately $67 million, all funded through internal cash
flow and I am delighted that equipping was completed in the period
and commissioning is on track to be completed in the first quarter
of 2021.
"Production in the Year was 57,899 ounces, which was at the top
end of the guidance range and was a new record for annual
production. The robust operating performance was supported by a
rising gold price and gross profit for the Year was $46.6 million -
almost 50 per cent higher than 2019. Gross profit for the Quarter
was $14.4 million - almost 27 per cent higher than the comparable
quarter. Once Central Shaft is commissioned, we can start to expect
further increases in production: guidance for 2021 is a range of
61,000 to 67,000 ounces while from 2022 onwards it is 80,000 ounces
- 38 per cent higher than in 2020.
"We also increased the dividend for the fourth time at the start
of January to 11 cents a share. This is a 60 per cent cumulative
increase from the level of 6.875 cents since October 2019, creating
genuine value and returns for our shareholders.
"In trying to minimise the impacts of our operations on the
natural environment and in a general drive towards a more
sustainable future for our business, Caledonia has entered into a
contract to construct a 12MW solar plant at the Blanket Mine. To
fund the project, in the third quarter of 2020, the Company issued
approximately 600,000 shares to raise $13 million before expenses.
The number of shares issued was lower than the 800,000 new shares
that the Company had expected to issue, thereby improving the
anticipated returns to shareholders from the project. Around 27 per
cent of the Mine's daily electricity demand is expected to be
provided by the new solar plant, thereby significantly decreasing
our reliance on non-renewable energy sources; it is also expected
to yield a modest return to shareholders.
"To further our commitment towards social responsibility, in
February 2021, we announced the appointment of Mrs Geralda
Wildschutt to serve as a non-executive director with a specific
focus on sustainability. Mrs Wildschutt has over 25 years'
experience working in social development and stakeholder management
in the fields of social performance, community relations in mining
operations, financial services and industry bodies focused on
responsible mining.
"In December we announced that we had entered into option
agreements on two properties, Glen Hume and Connemara North, in the
Gweru mining district in the Zimbabwe Midlands which has
historically produced significant quantities of gold. These options
give the Company the right to explore each property for periods of
15 and 18 months respectively and acquire the mining claims over
them. If our exploration is successful these properties will add
further impetus to our growth.
"Despite our operational success, 2020 has been a complicated
year globally with the Covid-19 pandemic wreaking havoc throughout
the world and disrupting many people's lives and livelihoods. The
Blanket Mine continued to operate throughout the whole period with
strict restrictions of movement put in place in and out of the Mine
and local community. The measures to combat the coronavirus are
constantly reviewed and monitored in line with WHO and government
guidelines, and with our priority always being the safety of our
people.
"Caledonia's immediate strategic focus is to complete the
Central Shaft project, which is expected to increase production,
reduce operating costs and increase the flexibility to undertake
further exploration and development, thereby safeguarding and
enhancing Blanket's long-term future. We will also conduct
exploration activities at Glen Hume and Connemara North while
evaluating further investment opportunities in the gold and
precious metals sector in Zimbabwe and in other jurisdictions, with
our long-term vision of becoming a mid-tier, multi-asset gold
producer."
Conference Call Details
A presentation of the 2020 results and outlook for Caledonia is
available on Caledonia's website (www.caledoniamining.com).
Management will host a conference call at 3pm GMT on 25th March
2021.
Details for the call are as follows:
Number: +44 (0) 33 0551 0200
Password to quote to the operator: Caledonia Mining
Mr Dana Roets (B Eng (Min.), MBA, Pr.Eng., FSAIMM, AMMSA), Chief
Operating Officer, is the Company's qualified person as defined by
Canada's National Instrument 43-101 and has approved any scientific
or technical information contained in this news release.
For further information please contact:
Caledonia Mining Corporation
Plc Tel: +44 1534 679 800
Mark Learmonth Tel: +44 7817 841 793
Camilla Horsfall
WH Ireland (Nomad & Broker)
Adrian Hadden/James Sinclair-Ford Tel: +44 20 7220 1751
Blytheweigh
Tim Blythe/Megan Ray Tel: +44 207 138 3204
3PPB
Patrick Chidley Tel: +1 917 991 7701
Paul Durham Tel: +1 203 940 2538
The information contained within this announcement is deemed by
the Company to constitute inside information under the Market Abuse
Regulation (EU) No. 596/2014.
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 common 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 common
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 of Loss and Other Comprehensive
Income
3 months ended 12 months ended
($'000's) December 31 December 31
2019 2020 2018 2019 2020
Revenue 23,433 28,128 68,399 75,826 100,002
Royalty (1,172) (1,408) (3,426) (3,854) (5,007)
Production costs (9,650) (11,174) (39,315) (36,400) (43,711)
Depreciation (1,275) (1,171) (4,071) (4,434) (4,628)
------- -------- -------- -------- --------
Gross profit 11,336 14,375 21,587 31,138 46,656
Other income 231 29 7,101 2,274 4,765
Other expenses (184) (3,488) (336) (666) (5,315)
Administrative expenses (1,686) (2,636) (6,465) (5,637) (7,997)
Net foreign exchange gain/(loss) 1,391 (389) 223 29,661 4,305
Cash-settled share-based payment (283) (236) (315) (689) (1,413)
Equity-settled share-based
payment - - (14) - -
Profit on sale of subsidiary - - - 5,409 -
Fair value losses on derivative
assets (277) (145) (360) (601) (266)
------- -------- -------- -------- --------
Operating profit 10,528 7,510 21,421 60,889 40,735
Net finance costs (162) 49 (220) (198) (305)
------- -------- -------- -------- --------
Profit before tax 10,366 7,559 21,201 60,691 40,430
Tax expense (7,136) (3,763) (7,445) (10,290) (15,173)
------- -------- -------- -------- --------
Profit for the period 3,230 3,796 13,756 50,401 25,257
------- -------- -------- -------- --------
Other comprehensive income
Items that are or may be reclassified
to profit or loss
Exchange differences on translation
of foreign operations 402 973 (676) 49 (173)
Reclassification of accumulated
exchange differences on the
sale of subsidiary - - - - -
Reversal of foreign exchange
currency translation differences
on disposal of subsidiary - - - (2,109) -
------- -------- -------- -------- --------
Total comprehensive income
for the period 3,632 4,769 13,080 48,341 25,084
------- -------- -------- -------- --------
Profit attributable to:
Shareholders of the Company 2,390 2,973 10,766 42,018 20,780
Non-controlling interest 840 823 2,990 8,383 4,477
------- -------- -------- -------- --------
Profit for the period 3,230 3,796 13,756 50,401 25,257
------- -------- -------- -------- --------
Total comprehensive income
attributable to:
Shareholders of the Company 2,792 3,946 10,090 39,958 20,607
Non-controlling interest 840 823 2,990 8,383 4,477
------- -------- -------- -------- --------
Total comprehensive income
for the period 3,632 4,769 13,080 48,341 25,084
------- -------- -------- -------- --------
Earnings per share (cents)
Basic 21.5 24.0 98.9 382.0 173.4
Diluted 21.3 23.9 98.9 381.5 173.2
Adjusted earnings per share
(cents) (3)
Basic 11.7 74.9 132 145.1 204.2
-------------------------------------- ------- -------- -------- -------- --------
(3) "Adjusted EPS" is a non-IFRS measure. Refer to section 10 of
this MD&A for a reconciliation to IFRS EPS .
Summarised Consolidated Statements of Financial Position
($'000's) As Dec
at 31 Dec 31 Dec 31
2018 2019 2020
Total non-current assets 97,525 113,714 133,334
Inventories 9,427 11,092 16,798
Prepayments 866 2,350 1,974
Trade and other receivables 6,392 6,912 4,962
Income tax receivable - - 76
Cash and cash equivalents 11,187 9,383 19,092
Derivative financial assets - 102 1,184
Assets held for sale 296 - 500
-------- --------
Total assets 125,693 143,553 177,920
-------- -------- --------
Total non-current liabilities 34,687 9,486 9,913
Term loan facility - short term
portion - 529 408
Lease liabilities - short term portion - 112 61
Trade and other payables 10,051 8,348 8,664
Income taxes payable 1,538 163 495
Overdraft - 490 -
Liabilities associated with assets
held for sale 609 - -
Cash-settled share-based payments
- short term portion - - 336
-------- -------- --------
Total liabilities 46,885 18,836 19,877
-------- -------- --------
Total equity 78,808 124,717 158,043
-------- -------- --------
Total equity and liabilities 125,693 143,553 177,920
----------------------------------------- ---------- -------- -------- --------
Condensed Consolidated Statement of Cash Flows
($'000's)
12 months ended December
31
2018 2019 2020
Cash flows from operating activities
Cash generated from operations 21,119 23,885 37,967
Net interest paid (108) (308) (349)
Tax paid (3,344) (5,517) (6,656)
--------- --------- ---------
Net cash from operating activities 17,667 18,060 30,962
Cash flows used in investing activities
Acquisition of property, plant and
equipment (20,192) (20,024) (25,081)
Acquisition of exploration and evaluation
assets - - (2,759)
Purchase of derivative financial
asset - - (1,058)
Proceeds from disposal of subsidiary - 1,000 900
--------- --------- ---------
Net cash used in investing activities (20,192) (19,024) (27,998)
Cash flows from financing activities
Dividends paid (3,497) (3,395) (4,542)
Repayment of term loan facility (1,500) - (574)
Term loan proceeds 6,000 2,340 -
Term loan - transaction cost (60) (46) -
Shares issued - equity raise - - 12,538
Payment of lease liabilities - (124) (118)
Share options exercised - - 30
--------- ---------
Net cash from/(used in) financing
activities 943 (1,225) 7,334
Net (decrease)/increase in cash and
cash equivalents (1,582) (2,189) 10,298
Effect of exchange rate fluctuations
on cash held 13 (105) (99)
Net cash and cash equivalents at
beginning of the period 12,756 11,187 8,893
Net cash and cash equivalents at
end of the period 11,187 8,893 19,092
------------------------------------------------- --------- --------- ---------
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