B2Gold's new Fekola mine, in Mali
Photo by: B2Gold
VANCOUVER (miningweekly.com) – Canadian multinational gold miner B2Gold has reported a stronger-than-expected third-quarter profit, despite its headline net profit – excluding special items – falling 71% year-over-year.
The Vancouver-headquartered company reported an adjusted net income for the three months ended September of $13.9-million, or $0.01 a share, down from $48.6-million, or $0.05 a share, in the comparable quarter of 2016. Analysts had on average expected headline earnings of nil per share, on revenue of $151.81-million.
Consolidated gold revenue came to $154.1-million on sales of 121 597 oz of gold, at an average price of $1 267/oz, which was 5% lower year-on-year. B2Gold advised that the 20%, or $38.9-million, decrease in revenue, was mainly attributable to the 16% decrease in gold sales volume, owing to lower output and the timing of gold shipments.
For the third quarter, the company generated net income of $12.4-million, or $0.01 a share, compared with a net income of $35.7-million, or $0.04 a share, in the same period a year ago.
Consolidated gold output in the quarter was 135 628 oz, including 6 340 oz of pre-commercial production from the newly constructed Fekola mine, in Mali, which was 2% above plan and 15% above the reforecast production profile. The better-than-budgeted reforecast consolidated gold output reflected the continued strong operational performances of both the Masbate mine, in the Philippines, and the Otjikoto mine, in Namibia, as well as the successful early start-up of the Fekola mine in September.
The miner, which has five producing mines spread across Namibia, the Philippines, Nicaragua and Mali, reported consolidated cash operating costs of $563/oz, 5% lower than budget, but 15% more than in the third quarter of 2016. Higher output at the Masbate and Otjikoto mines boosted the planned output and was partially offset by the lower ouput from La Libertad and El Limon mines, both in Nicaragua.
All-in sustaining costs (AISC) rose 8% quarter-on-quarter to $921/oz, compared with the planned $855/oz and $702/oz for the prior-year quarter. The increases were the result of higher-than-expected capital expenditures at the Otjikoto mine, owing to the timing of buying mobile equipment in the period, which was deferred from earlier this year.
For full-year 2017, B2Gold is projecting output to come in at the upper end of the company's revised guidance range of 530 000 oz to 570 000 oz and to be at the lower end of its cash operating costs guidance of $610/oz to $650/oz and AISC of between $940/oz and $970/oz. The strong operational performance is underpinned by continued strong performances from Masbate and Otjikoto which, combined with Fekola preprodution output, offset lower output from La Libertad and El Limon.
In 2018, with the planned first full-year of production from Fekola mine, B2Gold is projecting its consolidated gold output to rise 70% year-on-year to between 925 000 oz and 975 000 oz.
B2Gold’s TSX-listed stock closed up 3.67% on Wednesday, at C$3.39 a share, up 6.27% since the start of the year.