Release Date: August 09, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- B2Gold Corp (NAM:B2G, Financial) reported a strong financial quarter with $0.06 per share of adjusted earnings.
- The company remains in a strong financial position with $467 million in cash and cash equivalents and an available $700 million revolving credit facility.
- The Goose project is progressing well, with construction on track and expected to produce gold by Q2 2025.
- Masbate and Otjikoto mines continue to perform well, contributing strong cash flows and operational stability.
- The company has significant growth potential from existing assets, including the Fekola expansion and the Goose project, which could add up to 650,000 ounces of gold production annually.
Negative Points
- B2Gold Corp (NAM:B2G) had to lower its production guidance for the year due to equipment availability issues at the Fekola mine.
- The company took a non-cash impairment charge on the Fekola operations due to uncertainties related to the 2023 Mining Code in Mali.
- Higher consolidated all-in sustaining costs were reported, ranging between $1,420 and $1,480 per ounce, due to lower production and higher royalties.
- The company faced an operational setback with an excavator tip-over at the Fekola mine, causing a delay in production.
- There are ongoing challenges and uncertainties related to the implementation of the 2023 Mining Code in Mali, affecting the Fekola complex.
Q & A Highlights
Q: Can you discuss the factors involved in taking two impairment charges in succession for Fekola and provide a more definitive timeline for completion of negotiations with the Mali government?
A: We are very confident in reaching an agreement soon. The impairment charges reflect our best estimates based on new clarifications and ongoing discussions with the Mali government. The fact that we took the impairment charge suggests how close we are to finalizing an agreement.
Q: Does the updated ASIC guidance at Fekola include stripping planned for regional ounces next year, and should we expect costs to come down next year?
A: The updated guidance does not include regional production or related costs for this year. We haven't provided cost guidance for next year yet, but we expect regional ounces next year and the underground production to start in Q2 2025.
Q: What are the remaining large CapEx items outstanding for the Goose project, and are most of the large capital items already spent?
A: Most major items are purchased and on-site. We are currently reviewing what has been ordered to ensure it meets our standards. We expect to provide a concrete number by early September.
Q: Can you provide more color on the 2025 outlook and the impact of deferred ounces from 2024, regional ore, and Fekola Underground?
A: The 2025 outlook mainly involves sliding the high-grade zone from Phase 7 back. We are not changing anything for Fekola Regional or Underground projects, which remain on track.
Q: When do you expect the equipment availability issue at Fekola to be fully addressed, and is there any risk to that timeline?
A: The issue has already been addressed by replacing the excavator and bringing forward another one from 2025. We have met or exceeded our production targets so far in Q3. Fuel cost reductions will also help offset higher gross costs as we catch up.
Q: Given the challenges in Mali, can you speak to the integrity of the dividend and liquidity plans for funding projects?
A: We have $700 million available on our credit line and close to $500 million in cash. We feel comfortable maintaining our dividend and funding our capital projects. We will monitor our capital return components as we near the end of larger capital projects.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
