Mining

Caledonia to post “substantially higher” earnings for 2019 owing to gold price

CALEDONIA Mining Corporation, the Zimbabwe gold miner, would report “substantially higher” earnings for its 2019 financial year than expected as a result of continued strength of the gold price, higher than expected production and lower costs.

Earnings would come in for the year at between $1.55 and $1.75 per share compared to company guidance in early 2019 of $0.86 to $1.17 per share.

Steve Curtis, CEO of Caledonia, said the earnings outcome was despite struggling with power interruptions and grade volatility at its Blanket mine, which it is expanding.

“With these challenges addressed, an excellent start to 2020 and with the development of the Central Shaft continuing on time and record quarterly production in the fourth quarter, we look forward to an exciting year ahead,” he said.

The company has kicked off 2020 in style. It announced on January 21 that it had increased its stake in its Blanket gold mine to 64% after cancelling a shareholder loan dating back to 2012 related to Zimbabwe’s indigenisation policy.

Curtis said earlier this month that he expected 2020 to be “a landmark” year for the company largely owing to the expansion of Blanket which achieved record fourth quarter production of 16,876 oz.

The production amounts are small in absolute terms but Caledonia is relevant as it’s an outlier in terms of being able to successfully operate in Zimbabwe despite foreign exchange and electricity supply problems.

Last year, it unveiled a 9% lift to its quarterly dividend – an increase it said was motivated by an increase in production and the stronger dollar gold price.

Caledonia expects to publish its results for the year to December 31, 2019 on or around March 20.

The post Caledonia to post “substantially higher” earnings for 2019 owing to gold price appeared first on Miningmx.

Source: miningmx.com

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