B2Gold Corp (NSX: B2G)(NYSE: BTG)(TSX: BTO) doubled its yearly income but saw a downfall from its previous quarter.
The company released its financial results for Q2, 2023 on Wednesday, where it increased its yearly income by 122 per cent from USD$36 million to USD$80 million. However, it reduced its quarterly income by 6.9 per cent, down from $86 million.
The company produced approximately 262,000 gold ounces in the quarter, marking a 1.56 per cent decrease from the previous quarter, but still up 17 per cent from Q2, 2022. This includes 16,740 ounces of attributable production from Calibre Mining (TSX: CXB) (OTCQB: CXBMF).
B2Gold is entitled to a 25 per cent indirect share of production from Calibre’s El Limon and La Libertad mines in Nicaragua as part of a purchase agreement signed in 2019.
B2Gold reduced the cost of producing one ounce of gold to $667 as the average of all of its mines, which is 15 per cent lower than last year’s cost. Meanwhile, B2Gold’s all-in sustaining costs (AISC) per ounce in Q2, 2023 were $1,214 compared to last year’s cost of $1,111 per ounce.
The company’s anticipated gold production is between 1 million and 1.08 million ounces of gold for the rest of the year, which costs in the range of $670 to $730 per ounce.
In late June, the B2Gold had cash and cash equivalents of $506 million and working capital of $570 million, which is down from Q1 by approximately 24 per cent and 29 per cent respectively.
The company closed the acquisition of Sabina Gold and Silver Corp, giving the company access to Sabina’s Black River Gold District in Nunavut, Canada in exchange for 216 million B2Gold shares.
Currently, the company is working on setting up the project’s camp, installing generators and constructing workshops. Instead of using a fixed-priced contract B2Gold decided to handle the construction in-house, which is expected to reduce costs and ensure the mill runs smoothly with lower ongoing expenses.
B2Gold successfully completed its first winter ice road season and paid off certain financial obligations related to Sabina’s construction, including spending $112 million on a debt facility, a gold prepay agreement, a gold offtake agreement and a gold stream arrangement.
Read more: Calibre reports high-grade results from Talavera deposit in Nicaragua
Read more: Calibre Mining’s discoveries at Eastern Borosi hold promise for extended lifespan
Fekola mine produces high numbers
The Fekola Mine in Mali produced 152,427 ounces of gold, which slightly lower than expected due to issues with gold recovery, delayed delivery of important equipment and inefficiencies in certain mining areas. However, the company is confident that it will catch up on the production in the Q4 2023 and meet annual production goals.
The cost to operate the Fekola Mine and produce each ounce of gold was $538 for Q2, 2023.
The overall costs to sustain the Fekola Mine and continue producing gold were $1,165 for each ounce sold in the second quarter of 2023. These costs were higher than expected mainly because of higher-than-anticipated expenses for maintaining the mine, which was influenced by the timing of capital investments.
The company also spent $74 million on various capital projects, including equipment purchases and rebuilds, prestripping, underground development, tailings facility raise, solar plant expansion and haul road construction.
The Fekola Complex in Mali is expected to produce between 580,000 and 610,000 ounces of gold in 2023, with operating costs per ounce ranging from $565 to $625 and overall costs per ounce ranging from $1,085 to $1,145. However, due to some regulatory delays, production from a specific permit area will be delayed until 2024. Nonetheless, the company’s overall production guidance for 2023 remains unchanged due to other available ore sources in the Fekola Complex.
Read more: Calibre Mining reports high-grade discoveries at untapped regions in Panteon VTEM corridor
Read more: Calibre Mining reports 32% sequential cash balance increase to US$77M
B2Gold benefits on weak Namibian dollar
Meanwhile, the Masbate Mine in the Philippines produced 49,478 ounces of gold. This was possible because it had more high-quality ore and processed more material than initially planned.
The cost to operate the mine and produce each ounce of gold was $817. Operating costs were lower than anticipated due to increased production, and savings on mining and processing expenses due to lower fuel costs.
The overall costs to sustain the mine and continue producing gold were $1,091 for each ounce sold. This lower costs were attributed to savings in operating costs and the lower expenses for maintaining the mine.
The Otjikoto Mine in Namibia produced 44,056 ounces of gold and the company anticipates production to improve in the second half of the year because of plans to mine higher-grade ore. This is part of the company’s mining schedule for Phase 4 of the Otjikoto pit, along with increased production from the Wolfshag underground mine.
The cost to operate the mine and produce each ounce of gold was $611 for the second quarter of 2023 and the company sold each ounce for $641. The operating costs were lower than expected because of the higher gold production, which helped save on fuel expenses, and the weaker Namibian dollar.
The overall costs to sustain the mine and continue producing gold were $1,187 for each ounce sold. These costs were lower than expected because of the savings in operating costs and the timing of some expenses related to underground development.
The company also spent $16 million in pit preparations and development for the underground mine.
The Otjikoto Mine is expected to produce between 190,000 and 210,000 ounces of gold in 2023, with operating costs per ounce ranging from $590 to $650 and overall cost per ounce ranging from $1,080 to $1,140.
B2Gold anticipates processing 3.4 million tonnes of ore with an average gold grade of 1.87 g/t and expects to recover 98.0 per cent of the gold.
Shares dipped by 0.5 per cent to $4.26 on Friday on the Toronto Stock Exchange.
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