St Helier, May 15, 2023: Caledonia Mining Corporation Plc ("Caledonia" or the "Company") announces its operating and financial results for the quarter ended March 31, 2023 (the "Quarter"). Further information on the financial and operating results for the Quarter can be found in the Management Discussion and Analysis ("MD&A") and the unaudited interim financial statements which are available on the Company's website and which have been filed on SEDAR.
This Quarter's results are the first to reflect Caledonia's ownership of Bilboes, the acquisition of which was completed on January 6, 2023. The near-term actions relating to Bilboes are to re-start oxide mining operations and prepare a revised feasibility study in respect of the larger sulphide project. Technical challenges were encountered on re-starting the oxide mining, but it is hoped that gold mining from near surface oxide deposits will be cash neutral and will help the Company to maintain Bilboes' operational integrity pending completion of the feasibility study. In addition, the waste material that will be moved as part of the oxide mining activities is material that would have had to be moved later when work starts on the main sulphide project.
As stated in the first quarter production update dated April 24, Blanket Mine ("Blanket") suffered some technical challenges which adversely affected its contribution in the Quarter. Management believes these challenges have now been resolved and is encouraged by production and cost data in April and to date in May. Accordingly, Caledonia reiterates its production guidance of 75,000-80,000 ounces for Blanket for 2023.
Financial Highlights
Financial performance was largely affected, as expected, by the integration and start-up of the Bilboes operation and technical challenges at Blanket:
· Gross revenues of $29.4 million (Q1 2022: $35.1 million). Lower revenues reflect lower gold production at Blanket.
· Reduced EBITDA contribution in the period of $2.25 million (Q1 2022: $14.5 million). The disappointing contribution was due to lower revenues and higher operating costs at Blanket and the costs at the Bilboes oxide mine. Blanket Mine contributed EBITDA of $11.3m in the Quarter (Q1 2022: $19.5m).
· On-mine cost[1] per ounce increased by almost $500 per ounce from $698 in Q1 2022 to $1,196 per ounce. Approximately $300 of the increase was due to the Bilboes oxides mining activities where production only commenced in the last week of the Quarter, but operating costs were incurred for much of the Quarter. The on-mine cost per ounce at Blanket increased due to lower gold production (which meant that fixed costs were spread across fewer ounces) and higher than anticipated electricity costs.
· All-in sustaining cost[1] of $1,412 per ounce (Q1 2022: $848 per ounce). The increase was due to the higher on-mine cost and advisory fees payable on the completion of the Bilboes acquisition.
· Adjusted loss per share of 29.1 cents (Q1 2022: profit of 62.5 cents). Reduced EBITDA for the Quarter was exacerbated by higher administrative expenses, a higher interest charge and an increase in the effective tax rate.
· Net cash outflow from operating activities of $0.9 million (Q1 2022: net cash inflow of $10.2 million).
· Net cash and cash equivalents of $3.2 million (Q1 2022: $14.4 million). The net cash position at March 31, 2023 was negatively impacted by a build-up in undelivered gold to a value of approximately $2.8 million at the end of the Quarter pending the implementation of a new gold sale mechanism in early April. In early April net cash was enhanced by these gold sales and the receipt of approximately $5.0 million from the Zimbabwe leg of the equity raise.
· Dividends of 14 cents per share were paid in January.
A segmental analysis showing the summarised financial performance of Blanket and Bilboes is set out below.
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