Central banks all over the world have been aggressively buying gold.In fact, in September alone, central banks bought 77 tonnes of gold. Even more impressive, sales of one tonne were overshadowed by gross purchases of 78 tonnes. In August, central banks also added 77 tonnes – a 38% uptick month over month. In July, they bought 55 tonnes of gold. In addition, central banks were busy ramping up gold reserves in the first half of the year. All of which is positively impacting companies such as Calibre Mining Corp. (TSX: CXB) (OTCQX: CXBMF), Barrick Gold Corporation (NYSE: GOLD) (TSX: ABX), Newmont Corporation (NYSE: NEM) (TSX: NGT), Franco Nevada Corp. (NYSE: FNV) (TSX: FNV), and Royal Gold Inc. (NASDAQ: RGLD).
“Despite a year-on-year decrease of 103 tons in purchases during the second quarter, net purchases by central banks worldwide still hit a record-breaking 387 tons in the first six months of the year, according to the latest data compiled by the World Gold Council (WGC),” as noted by Global Times. The WGC also added that central bank gold buying will remain strong throughout the year, especially with ongoing geopolitical tensions and challenging economic conditions around the world. China, for instance, just raised its gold reserves for the ninth straight month, as it continues to diversify its reserves.
Look at Calibre Mining Corp. (TSX: CXB) (OTCQX: CXBMF), For Example
Calibre Mining Corp.announces financial and operating results for the three and nine months ended September 30, 2023. Consolidated financial statements and management discussion and analysis can be found at www.sedarplus.ca and the Company’s website, www.calibremining.com. All figures are expressed in U.S. dollars.
Q3 2023 Highlights
- Record cash on hand of $97 million, a 26% increase over Q2 2023 and 72% higher than the beginning of 2023;
- Free Cash Flow increased over Q2, 2023 to $16.3 million;
- 4th consecutive record quarterly gold sales of 73,241 ounces grossing $143.9 million total revenue, at an average realized gold price of $1,929/oz;
- Consolidated Total Cash Costsof $1,007 and All-in Sustaining Costs of $1,115 per ounce;
- Net income of $23.4 million or $0.05 per basic share;
- Adjusted net income of $24.5 million or $0.05 per basic share;
- Exploration success at Libertad yielded an Initial Mineral Resource Estimate at the Volcan Gold Deposit;
- Intercepted high-grade gold targets at the Jabali Mine, potentially expanding resources;
- High-grade, near surface drill results immediately north and south of the operating Pan mine demonstrate potential to increase resources, grade, and confidence across the property; and
- Announced Normal Course Issuer Bid as a responsible and potential use of available cash.
Year-to-Date 2023 Highlights
- Record consolidated gold sales of 208,020 ounces grossing $410.1 million in total revenue, at an average realized gold price of $1,932/oz;
- Consolidated TCC of $1,047/oz; Nicaragua $983/oz & Nevada $1,412/oz;
- Consolidated AISC of $1,195/oz; Nicaragua $1,101/oz & Nevada $1,456/oz; and
- Net income of $73.0 million, or $0.16 per share.
Darren Hall, President and Chief Executive Officer of Calibre, stated: “Calibre generated strong free cash flow from a fourth consecutive quarter of record production, resulting in a 72% increase in cash on hand to $97 million since the beginning of the year. Year to date costs are favorable to budget and the Company is in excellent shape to deliver at the high end of full year production guidance.
Our exploration investment continues to yield success in many areas including: a new gold trend emerging northwest of our recently announced Volcan gold deposit at Libertad, demonstrating high-grade discovery potential; drill results proximal to the operating Pan mine continue to yield potential resource and grade increase opportunities; and the expansion of existing high-grade gold discoveries across our Limon property provide further opportunity to leverage the available surplus processing capacity at our Libertad mill.
The Company continues to self fund all exploration and growth from operating cash flow while increasing our cash reserves. We remain dedicated to providing lasting and responsible benefits to all stakeholders. Our ongoing incorporation of sustainability initiatives throughout our operations further solidifies our strong social license to operate.”
CONSOLIDATED Q3 and YTD 2022 FINANCIAL REVIEW
Q3 2023 TCC and AISC were $1,007 per ounce and $1,115 per ounce, positive to budget. The lower quarter over quarter AISC was achieved through higher gold sales from an increase in open pit ore tonnes, underground mining optimization improvements with associated increases in tonnes mined and higher head grades coupled with a reduction in diesel prices.
YTD 2023 TCC and AISC) were $1,047 per ounce and $1,195 per ounce respectively, within guidance and favorable to budget, positioning the Company well to meet full year cost guidance. YTD costs are favorable due to higher-grade ore from the Pavon Central deposit, mining the Jabali Antena deposit, lower stripping at the Limon Central deposit and higher silver revenue.
Expenses and Net Income
For Q3 2023 and year to date 2023, corporate G&A was $3.2 million and $8.6 million respectively, compared to $3.1 million and $9.4 million for the same periods in 2022. Year-to-date corporate administration was lower due to a reduced use of professional consultants.
For the fourth consecutive quarter, the Company achieved record gold production of 73,485 ounces with year-to-date production of 208,011 ounces, at costs below budget. This puts the Company in a strong position to deliver the high end of its full year 2023 production guidance. Given the current gold prices, Calibre is generating strong cash flow, self-funding all investments in growth, development and exploration while significantly growing its net cash balance.
Calibre continues to advance its 100,000+ metre drill program which includes resource delineation drilling, infill and geotechnical drilling, as well as early-stage generative exploration drilling to test numerous satellite targets around Limon, Libertad, the Eastern Borosi Mine and within Nevada.
Q3 and YTD 2023 FINANCIAL RESULTS AND CONFERENCE CALL DETAILS
Third quarter financial results will be released after market close on Tuesday, November 7, 2023, and management will be hosting a conference call on Wednesday, November 8 to discuss the results and outlook in more detail.
Date: Wednesday, November 8, 2022
Time: 10:00 a.m. (ET)
Webcast Link: https://edge.media-server.com/mmc/p/uippamra
Instructions for obtaining conference call dial-in numbers:
1) All parties must register at the link below to participate in the Calibre Mining, Q3 conference call.
2) Register by clicking https://register.vevent.com/register/BIaeef792eb39c469b8d3571c2423f7f24 and completing the online registration form.
3) Once registered you will receive the dial-in numbers and PIN number for input at the time of the call.
The live webcast and registration link can be accessed here and at http://www.calibremining.com under the Events and Media section under the Investors tab. The live audio webcast will be archived and made available for replay at www.calibremining.com. Presentation slides that will accompany the conference call will be made available in the Investors section of the Calibre website under Presentations prior to the conference call.
Other related developments from around the markets include:
Barrick Gold Corporation reported preliminary Q3 sales of 1.03 million ounces of gold and 101 million pounds of copper, as well as preliminary Q3 production of 1.04 million ounces of gold and 112 million pounds of copper. Q3 production was higher than Q2, although lower than previous plans for the quarter, especially at Pueblo Viejo where equipment design deficiencies contributed to the delayed ramp up of the expansion project. We continue to expect a significant increase in fourth quarter production volume. The average market price for gold in Q3 was $1,928 per ounce while the average market price for copper in Q3 was $3.79 per pound. Preliminary Q3 gold production was higher than Q2 primarily as a result of higher production at Cortez driven by higher oxide production from the Crossroads open pit and Cortez Hills underground. In addition, production was higher at Turquoise Ridge due to planned autoclave maintenance in the previous quarter and at Kibali driven by improved grades. This was offset by lower production at Carlin due to lower grades resulting from an increase in stockpiled ore processed. Compared to Q2, Q3 gold cost of sales per ounce2 is expected to be 2% to 4% lower, total cash costs per ounce3 are expected to be 4% to 6% lower and all-in sustaining costs per ounce5 are expected to be up to 6% to 8% lower.
Newmont Corporation’s President and Chief Executive Officer, Tom Palmer issued the following statement after the Scheme of Arrangement, under which Newcrest Mining Limited (will be acquired by Newmont, became legally effective under Australian law. This followed lodging of the orders of the Federal Court of Australia with the Australian Securities and Investments Commission after Newcrest’s shareholders voted in favor of the Scheme. "This milestone represents a pivotal and historic moment in our strategy to create the world’s premier gold and copper company by consolidating Tier 1 assets in the world’s most favorable mining jurisdictions," said Tom Palmer, Newmont’s President and Chief Executive Officer. "Once complete, our combined business will feature 10, Tier 1 operations supporting decades of safe, profitable, and responsible gold and copper production, with best-in-class sustainability performance. We appreciate Newcrest’s and Newmont’s shareholders’ vote of confidence in our value-focused strategy, proven operating model and seasoned management team."
Franco Nevada Corp. announced "Our portfolio continues to generate strong cash flows and high margins. The second quarter's results benefited from our core assets returning to normal production and deliveries caught up from the disruptions in Q1. Revenue from our Diversified assets was impacted by lower oil, gas and iron ore prices compared to the relative highs of the prior year period" stated Paul Brink, CEO. "We expect Total GEOs for the year to be at the low end of our guidance range provided in March this year. We are looking forward to increased contributions from Cobre Panama, where the CP100 Expansion is on-track for year-end, and to contributions from royalties on several new mines. Franco-Nevada is debt-free and is growing its cash balances."
Royal Gold Inc. announced that Newmont Corporation issued a press release announcing that it has reached a preliminary agreement with the National Union of Mine, Metal and Allied Workers of the Mexican Republic aiming to end the strike initiated by the Union on June 7, 2023, at Minera Peñasquito in the Mexican State of Zacatecas. According to Newmont, the preliminary agreement was ratified by the General Assembly of the Union on October 5, 2023, and this preliminary agreement is intended to be formalized into a definitive agreement, which the parties will have to agree, approve, sign, and file with the Federal Labor Tribunal for Collective Affairs in Mexico City for final approval.
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