Calibre Mining (TSX: CXB) (OTCQX: CXBMF) sold record breaking amounts of gold in Q2 2023 due to its cost-reduction strategies and underground mining operations in Nicaragua and Nevada.
The company released its second quarter financial and operating results for the three and six months ending in June 2023, where it said it unloaded approximately 69,000 ounces with $139.3 million in net income, representing a 6 per cent increase over the 65,000 ounces in the previous quarter.
Additionally, the company opened a fourth new open pit mine, with effective transportation of ore from the Eastern Borosi mine to the Libertad mill.
Calibre’s free cash flow is $15.9 million, and it’s cash reserves increased to $77 million, marking a 32 per cent increase from Q1 2023.
In the second quarter of 2023, the costs to produce an ounce of gold was $977 with an all-in-sustaining costs (AISC) of $1,178 per ounce, representing a 16 per cent decrease over last quarter. The reason for the lower costs in this quarter included the increased amount of ore extracted from open pit mines.
Additionally, costs decreased due to lower diesel prices, and improvements in extraction methods, which led to more ore being mined with higher quality.
The year to date costs up to Q2 2023, producing one ounce of gold cost an average of $1,068 and the AISC cost was $1,239. This is compared to $1,121 and $1,244 per ounce in the same period of 2022. These costs for the year are in line with guidance.
“Our consolidated Total Cash Cost and All-in Sustaining Costs being lower than budget position the company to deliver full year production and cost guidance and generate strong free cash flow,” said Darren Hall, CEO of Calibre Mining.
For the three and six months ending on June 30, 2023, the company’s administrative costs were $2.7 million and $5.4 million, respectively. This is a decrease from the same periods in 2022 when the costs were $3.2 million and $6.3 million. The reduction in corporate administration expenses was due to using fewer external consultants.
The company spent $100,000 on employee share compensation during Q2, and a total of $1.7 million for the year so far. This is an increase from the previous year, driven by the vesting of options and stock units given to employees in earlier years. The higher share price also contributed to the increased cost.
In terms of financial expenses, the company had a total cost of $1 million for the quarter and $1.9 million for the year to date. In comparison, during the same periods in 2022, the expenses were $500,00 and $1 million, respectively.
The company’s expenses related to income tax, both the immediate and deferred portions, amounted to $16.2 million during Q2 2023 and $26.2 million for the year to date. In the same periods of 2022, the expenses were $10.5 million and $18.6 million. This increase in tax expenses for Q2 2023, compared to Q2 2022, was due to higher pre-tax income, although it was partially balanced by a lower overall tax rate.
Chart via Calibre Mining.
Read more: Calibre Mining expands resources from open pit at Nevada’s Pan Gold Mine
Read more: Calibre Mining reports high-grade discoveries at untapped regions in Panteon VTEM corridor
Company exploration produces high grades
The company’s exploration endeavours yielded high-grade results at its Talavera deposit.
Drill intercept highlights at Talavera include:
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10.22 g/t Au over 4.2 metres including 15.25 g/t Au over 2.0 metres; 15.46 g/t Au over 6.7 metres including 18.09 g/t Au over 5.7 metres; 10.58 g/t Au over 7.9 metres including 15.18 g/t Au over 2.9 metres in Hole LIM-22-4688;
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3.89 g/t Au over 2.5 metres including 5.85 g/t Au over 1.5 metres; 4.45 g/t Au over 20.9 metres including 8.09 g/t Au over 5.4 metres and 6.69 g/t Au over 3.5 metres; 9.31 g/t Au over 3.1 metres in Hole LIM-22-4677;
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3.92 g/t Au over 3.6 metres in Hole LIM-22-4673;
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4.10 g/t Au over 4.2 metres in Hole LIM-22-4721.
Additionally, results stemming from drilling activities at the Pan Gold Mine in Nevada show the presence of higher-grade deposits close to the surface.
Calibre is actively dedicating resources to its exploration initiatives. These efforts involve moving forward with a drilling program covering over 100,000 meters. This program encompasses various types of drilling activities, including defining existing resources, filling in gaps, evaluating geotechnical aspects, and conducting exploratory drilling to investigate potential deposits in satellite locations near Limon, Libertad, Eastern Borosi and Nevada.
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