Endeavour Mining confident despite full-year loss

Endeavour Mining said in its full-year results on Thursday that it produced 1.4 million ounces of gold at an all-in sustaining cost (AISC) of $928 per ounce, generating operating cash flow of $1bn.

The FTSE 100 company said shareholder returns for the year amounted to $299m.

During the fourth quarter, the firm said it produced 355,000 ounces of gold at an all-in sustaining cost of $954 per ounce, bringing the total for the fiscal year to 1.4 million ounces at $928 per ounce.

That marked the 10th consecutive year that Endeavour had achieved or beaten its production and all-in sustaining cost guidance.

Adjusted net earnings for the fourth quarter came in at $65m, or 26 US cents per share, bringing the total for the year to $405m, or $1.63 per share.

However, the company reported a net loss attributable to shareholders of $256m, or $1.04 per share, for the fourth quarter due to an impairment of $360m.

For the year as a whole, the net loss attributable to shareholders was $66m, or 27 cents per share.

Endeavour said it ended the year in a strong financial position, with $121m of net cash - up $45m over the prior year.

Its dividend for 2022 totalled $200m, representing $50m more than the minimum committed dividend for the year.

Share buybacks continued to supplement shareholder returns, with $99m completed in the year.

The firm said its Sabodala-Massawa expansion and Lafigué greenfield project construction were both on budget and on schedule for production in the second and third quarters of 2024, respectively.

Endeavour was also planning to continue its strong exploration focus in 2023, with a $70m group budget and a key focus area being the new Tanda-Iguela discovery.

While the company's measured and indicated resources remained flat year-on-year at 27.3 million ounces, its proven and probable reserves decreased by one million ounces to 16.8 million ounces, as near-mine exploration partially replaced depletion.

“2022 was another successful year for Endeavour during which we delivered on all our objectives and met guidance for a tenth consecutive year,” said president and chief executive officer Sebastien de Montessus.

“As a trusted partner, we were pleased to contribute approximately $400 million to our host countries through tax, royalty and minority interest dividend payments, in addition to continuing our focus on local procurement.

“Through our commitment to reward shareholders, we returned approximately $300m in the form of dividends and share buybacks to shareholders, equivalent to $212 per ounce of gold produced, which represents double our minimum target for the year.”

De Montessus said the company was also pleased that the Sabodala-Massawa expansion and the Lafigué greenfield build were progressing well, with both projects on track for first production in 2024, and costs in line with expectations.

“Moreover, our exploration programme continues to provide a platform for future growth with the discovery of the promising Tanda-Iguela deposit in Côte d’Ivoire, which has the potential to become another cornerstone asset for the company.

“We have entered 2023 with considerable momentum and we look forward to continuing to deliver against our strategic objectives for the benefit of all our stakeholders.”

At 0944 GMT, shares in Endeavour Mining were down 4.73% at 1,611p.

Reporting by Josh White for Sharecast.com.