Caledonia Mining reports rise in Blanket Mine gold production

Caledonia Mining reported a notable increase in gold production from its Blanket Mine in Zimbabwe for the first quarter of 2024 on Wednesday, despite a reduction in production days compared to the same period in 2023.

The AIM-traded company said gold production for the quarter reached 17,050 ounces, making for a 6% rise from the first quarter of the prior year.

Despite operating with 9.3% fewer production days, the increased production was attributed to the company's strategy of setting a production cut-off for gold delivery by 21 March.

That decision contributed to streamlining operations and maximising output within a shorter timeframe.

Caledonia also reported that gold sales for the quarter stood at 18,450 ounces, reflecting a 17% increase compared to the same period in 2023, during which 15,797 ounces were sold.

It noted that the ounces sold in the quarter included 3,057 ounces of gold work in progress, which were classified as inventory at the end of 2023, while the comparable figure for the first quarter of 2023 was 1,657 ounces.

Looking ahead, Caledonia said it was optimistic about its gold production prospects for the year 2024, reaffirming its guidance for Blanket Mine at 74,000 to 78,000 ounces.

“I am pleased that 2024 production at Blanket has got off to a strong start with over 17,000 ounces produced in the quarter which, considering we had 8 fewer production days compared to the first quarter of 2023, is an excellent result,” said chief executive officer Mark Learmonth.

“With the current high gold prices, it was good to see our gold sales ounces increase by 17% in the first quarter of 2024 versus the first quarter of 2023.”

Learmonth said the company’s “significant” investment in Blanket over the last seven years, and completion of the Central Shaft, had nearly doubled production, extended the mine life and allowed the restart of underground exploration in 2023.

“We continue to see Blanket as the solid foundation for growth as we pursue our strategy to become a multi-asset gold producer.”

At 1225 BST, shares in Caledonia Mining Corporation was up 0.86% at 880p.

Reporting by Josh White for Sharecast.com.