The 2019 financial year, ended December 31, was the first profitable year for Aim-listed Hummingbird Resources, which CEO Dan Betts says marks a milestone in the development of the company.

Financial highlights for the year include group sales of $156.9-million and earnings before interest, taxes, depreciation and amortisation of $54.4-million. Pre-tax profit of $9.4-million was achieved for the year.

Hummingbird’s net debt was reduced to $31-million from the $39.4-million reported in 2018.

In terms of operations, Hummingbird, which operates the Yanfolila gold mine, in Mali, increased its output to 115 649 oz, compared with the 91 620 oz produced in 2018.

All-in sustaining costs (AISC) averaged $986/oz, down from an AISC of $1 087/oz in the year before.

The average grade of the gold was 2.88 g/t in 2019.

Hummingbird sold 112 686 oz of gold at an average price of $1 377/oz.

“Strong cash flows, rapid de-leveraging and maintaining [the company’s] trajectory to be net debt free in the 2020 calendar year puts us in an excellent position to support our development plans for the future,” Betts comments.

2020 OUTLOOK
Following the production of 30 282 oz in the first quarter of the new year, Hummingbird on June 3 confirmed that it maintains its 2020 full-year production guidance at between 110 000 oz and 125 000 oz.

The company remains on track to move from a net debt to net cash position before the end of the year.

Hummingbird also published its five-year rolling mine plan during 2019, which has a 574 000 oz forecast to be produced with an average production of over 120 000 oz yearly over the next three years
 
However, the company continues to experience cost pressures related to Covid-19; particularly employment costs and logistics costs coupled with potential extra material movement later in the year as Hummingbird considers taking advantage of higher gold prices and re-sequencing its mine plan to ensure the long term profitability of the mine.

These factors may contribute to as much as an additional $100/oz in AISC for this year. 

In terms of exploration for 2020, Hummingbird restarted field exploration activities, initiating drilling operations on the March 5. 

As previously announced, for 2020, the company has adopted a three-fold exploration strategy targeting both openpit and underground resources and reserves, in addition to testing new near-mine targets to feed the exploration pipeline. 
 
The bulk of the drilling will be to target resources at the existing deposits containing indicated and inferred resources not yet in the mine plan, such as Komana East underground, Sanioumale East, Kabaya South.

These deposits have been shallowly drill-tested in the past, which demonstrated further upside potential, adding further economic resources to the current life-of-mine (LoM) plan. These new resources create further optionality, robustness and mine life to the existing LoM schedule, the company says.
 
Exploring and testing the newly identified greenfield targets near the mine present another opportunity to grow the resource base, and the initial targets to be drill tested have been selected on the basis of five key criteria − the strength of the gold in the soil anomaly, underlying controlling structure, proximity to the process plant, location within the mining licence, and future resource growth potential. 
 
Diamond drilling operations have started at Komana East targeting the underground resource development, and Hummingbird explains that this drilling will build up the ounce profile to support and expand the planned Komana East trial underground mine.

Drilling, to date, has intersected and confirmed the presence and continuity of mineralisation that extends beyond the previous limit of the resource model and/or improves the resource confidence. Samples from the initial holes drilled have been sent off for assaying with results received for the first four holes of the 14-hole programme.
Reverse circulation resource growth and definition drilling will start in early June at Sanioumale West and East.

Both deposits contain only oxide resources owing to previous mineral resource estimate modelling parameters but remain open along strike and at depth, into the fresh rock. Additionally intersections such as 10.5 m at 5.4 g/t gold from hole SNDD0029 at Sanioumale East, which still require follow-up work, further demonstrate the future resource growth potential at the deposits, the company added.
 
Additionally, reconnaissance drilling on high-priority targets, both within the mining licence and the adjacent Diaban exploration licence are being targeted. The reconnaissance drill programme at the first of these greenfield targets, named BBC, has just been completed with the drill results received for the first six holes.

“The results are very encouraging at this early stage" and drilling has moved onto the second greenfield target, Haul Road Hill, which is located along the main haul road between Komana East and the process plant.
 
Further exploration target generation work is being carried out simultaneously to the above drill programmes as Hummingbird looks to pursue new opportunities to add to the pipeline of resource growth targets.