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Feb 27, 2020 10:30 PM ET

B2Gold Reports Strong Fourth Quarter and Full-Year 2019 Results and Record 2019 Annual Gold Production of 980,219 Oz; Declares Dividend for First Quarter 2020


iCrowd Newswire - Feb 27, 2020

VANCOUVER,- B2Gold Corp. (TSX: BTO, NYSE AMERICAN: BTG, NSX: B2G) (“B2Gold” or the “Company”) is pleased to announce its operational and financial results for the fourth quarter and full-year ending December 31, 2019. The Company previously released its gold production and gold revenue results for the fourth quarter and full-year 2019, in addition to its production and budget guidance for 2020 (see news release dated 1/15/2020). In 2020, the Company is forecasting total gold production of between 1,000,000 and 1,055,000 ounces. All dollar figures are in United States dollars unless otherwise indicated.

2019 Fourth Quarter Highlights

2019 Full-Year Highlights

   

(1)

On October 15, 2019, B2Gold and Calibre Mining Corp. (“Calibre”) completed the transaction where B2Gold restructured its interests in, and Calibre acquired, the El Limon and La Libertad mines. Accordingly, for the period from January 1, 2019 to October 14, 2019, for financial reporting purposes, the Company has classified the El Limon and La Libertad mines’ production and results as discontinued operations.

   

(2)

Commencing from October 15, 2019, B2Gold applies the equity method of accounting for its ownership interest in Calibre (approximately 34%) and reports its attributable share of Calibre production ounces as part of its total production results.

2019 Full-Year and Fourth Quarter Operational Results

For B2Gold, 2019 was another solid year of operational performance, with the achievement of B2Gold’s eleventh consecutive year of record annual consolidated gold production. For full-year 2019, B2Gold’s consolidated gold production was an annual record 969,495 ounces (including 118,379 ounces from discontinued operations). Including attributable ounces from Calibre (10,724 ounces for the stub period October 15, 2019 to December 31, 2019), consolidated gold production was 980,219 ounces, exceeding the upper end of the Company’s guidance range (of between 935,000 and 975,000 ounces). The Fekola Mine in Mali continued to outperform expectations in 2019 and exceeded the upper limit of its increased production guidance range (of between 445,000 and 455,000 ounces) with gold production of 455,810 ounces. The Masbate Mine in the Philippines delivered another very strong year in 2019, producing an annual record 217,340 ounces of gold, also exceeding the upper limit of its guidance range (of between 200,000 and 210,000 ounces). In addition, the Otjikoto Mine in Namibia had another solid year in 2019, producing 177,966 ounces of gold, also exceeding the upper limit of its guidance range (of between 165,000 and 175,000 ounces).

In the fourth quarter of 2019, B2Gold’s consolidated gold production was 234,416 ounces (including 6,010 ounces from discontinued operations). Including attributable ounces from Calibre (10,724 ounces for the stub period October 15, 2019 to December 31, 2019), the Company’s total gold production for the fourth quarter of 2019 was 245,140 ounces. Gold production from the Company’s continuing operations exceeded budget in the fourth quarter of 2019 by approximately 13,000 ounces, mainly due to the continued higher throughput at Fekola and high-grade ore production from the Wolfshag Pit at Otjikoto.

The Company’s full-year 2019 consolidated cash operating costs (including discontinued operations and the Company’s attributable share of Calibre’s results) were $512 per ounce produced ($519 per ounce sold), beating guidance (of between $520 and $560 per ounce). Consolidated AISC (including discontinued operations and the Company’s attributable share of Calibre’s results) were $862 per ounce sold, near the mid-point of the guidance range (of between $835 and $875 per ounce).

In the fourth quarter of 2019, consolidated cash operating costs (including discontinued operations and the Company’s attributable share of Calibre’s results) were $467 per ounce produced ($479 per ounce sold), in-line with or slightly lower than plan, and consolidated AISC were $882 per ounce sold. AISC for the fourth quarter of 2019 included timing differences related to the catch up of budgeted sustaining capital at Fekola and pre-stripping costs for Wolfshag Phase 3 at Otjikoto, both of which were delayed from earlier quarters in 2019. AISC for the fourth quarter of 2019, also included higher than budgeted royalties and production taxes (approximately $4 million) due to higher than budgeted realized gold prices and production.

Looking forward to 2020, B2Gold remains well positioned for continued strong operational and financial performance with consolidated gold production forecast to be in the range of between 955,000 and 1,005,000 ounces. Including the Company’s share (34%) of attributable ounces projected from Calibre’s El Limon and La Libertad mines (of between 45,000 and 50,000 ounces), the Company’s total gold production is expected to be between 1,000,000 and 1,055,000 ounces in 2020.

With higher gold production forecast for 2020, continued cost controls and the sale of the Company’s higher-cost Nicaraguan mines completed, the Company’s consolidated cash operating costs per ounce and AISC per ounce are both projected to further decrease in 2020. The Company’s consolidated cash operating costs (including the Company’s attributable share of Calibre’s results) are forecast to significantly decrease in 2020 (by approximately 15% compared to 2019) and be between $415 and $455 per ounce. The Company’s consolidated AISC (including the Company’s attributable share of Calibre’s results) are forecast to be between $780 and $820 per ounce, approximately 7% lower than in 2019.  

Based on current operating plans, over a five-year outlook from 2020 to 2024, annual consolidated gold production is forecast to average 950,000 ounces with AISC averaging $825 per ounce. 

2019 Full-Year and Fourth Quarter Financial Results

For full-year 2019, consolidated gold revenue from continuing operations was $1,156 million on sales of 827,800 ounces at an average price of $1,396 per ounce compared to $1,051 million on sales of 833,696 ounces at an average price of $1,261 per ounce in 2018. The $105 million (10%) increase in gold revenue was mainly attributable to a 10% increase in the average realized gold price. Including El Limon and La Libertad (discontinued operations), consolidated gold revenue was an annual record of $1,318 million on sales of 943,465 ounces at an average realized price of $1,397 per ounce.

For the fourth quarter of 2019, consolidated gold revenue from continuing operations was $314 million on sales of 211,800 ounces at an average price of $1,481 per ounce compared to $231 million on sales of 188,029 ounces at an average price of $1,228 per ounce in the fourth quarter of 2018. The significant increase in gold revenue of $83 million (36%) was mainly attributable to a 21% increase in the average realized gold price and 13% increase in gold ounces sold. Including El Limon and La Libertad (discontinued operations), consolidated gold revenue was $324 million on sales of 218,437 ounces at an average realized price of $1,482 per ounce.

For full-year 2019, consolidated cash flow provided by operating activities from continuing operations was $449 million compared to $426 million in 2018. Cash flow provided by operating activities (including $43 million from discontinued operations) was $492 million in 2019 compared to $451 million in 2018. At December 31, 2019, the Company had approximately 25,000 ounces of gold sitting at refineries waiting for final processing. Due to the timing of final shipments for the Fekola and Masbate Mines in late December 2019, these ounces were not available for sale until January 2020, when they were sold at an average realized price of $1,568 per ounce for total proceeds of approximately $39 million. In addition, in the fourth quarter of 2019, the Company elected to make a voluntary installment prepayment of Fekola income taxes of $12.5 million. This prepayment will reduce the final installment amount payable in the second quarter of 2020 for Fekola’s 2019 income taxes by a corresponding amount of $12.5 million. If the Company had not elected to make this voluntary prepayment of income taxes, cash flow provided by operating activities for 2019 would have totalled $505 million. Total cash income tax payments for 2019, including the final Fekola 2018 taxes due, the Fekola 2018 priority dividend and 2019 corporate tax installments, were $119 million. Based on current assumptions, the Company expects to make cash income tax payments in 2020 of approximately $115 million.

Cash flow provided by operating activities from continuing operations was $143 million in the fourth quarter of 2019 compared to $71 million in the prior-year quarter, significantly increasing by $72 million (101%), reflecting the significant increase in gold revenue (as a result of higher realized gold prices and sales, as discussed above). Cash flow provided by operating activities (including discontinued operations) was $145 million in the fourth quarter of 2019 compared to $74 million in the fourth quarter of 2018.

For full-year 2019, the Company generated net income of $316 million compared to $45 million in 2018. Net income attributable to the shareholders of the Company was $293 million ($0.29 per share) in 2019 compared to $29 million ($0.03 per share) in 2018. Adjusted net income attributable to the shareholders of the Company was $238 million ($0.23 per share) in 2019 compared to adjusted net income of $141 million ($0.14 per share) in 2018.  

Net income for the fourth quarter of 2019 was $182 million compared to a net loss of $50 million for the fourth quarter of 2018. Net income in the fourth quarter of 2019 included a $70 million impairment reversal (net of deferred income taxes) for the Masbate Mine and a $40 million gain recorded on the sale of the Nicaraguan operations to Calibre. For the fourth quarter of 2019, the Company generated net income attributable to the shareholders of the Company of $177 million ($0.17 per share) compared to a net loss attributable to the shareholders of the Company of $59 million (net loss of $0.06 per share) in the fourth quarter of 2018. Adjusted net income attributable to shareholders of the Company in the fourth quarter of 2019 was $69 million ($0.07 per share) compared to $3 million ($0.00 per share) in the fourth quarter of 2018.

Liquidity and Capital Resources

With higher gold production and gold prices forecast for 2020, together with lower forecast unit operating costs, the Company expects cash from operating activities to significantly increase in 2020. Based on current assumptions, including a gold price of $1,500 per ounce, the Company expects to generate cashflows from operating activities of approximately $700 million in 2020. 

At December 31, 2019, the Company had cash and cash equivalents of $141 million compared to cash and cash equivalents of $103 million at December 31, 2018. Working capital at December 31, 2019 was $242 million compared to $156 million at December 31, 2018. During 2019, the Company repaid $200 million of the outstanding balance on its RCF. At December 31, 2019, the Company had drawn a total of $200 million under the $600 million RCF, leaving an undrawn and available balance under the RCF of $400 million.

At December 31, 2019, the Company had total long-term debt of approximately $260 million outstanding, comprised of $200 million drawn under the RCF with the balance of $60 million relating to equipment loans. The Company expects to repay the remaining $200 million of the outstanding RCF balance in 2020, leaving the Company the full amount of the facility of $600 million as undrawn and available by the end of 2020. During 2020, the Company expects to draw down an additional $40 million of funding under its mining fleet loans related to the Fekola expansion fleet and repay approximately $29 million of principal under its existing mining fleet loans over the course of the year.

The Company’s ongoing strategy is to continue to maximize profitable production from its mines, reduce debt, expand the Fekola Mine throughput and annual production, further advance its pipeline of development and exploration projects, evaluate exploration opportunities and to continue paying a dividend.

Quarterly Dividend

On February 27, 2020, B2Gold’s Board of Directors declared a quarterly cash dividend of $0.01 per common share, payable on March 23, 2020 to shareholders of record as of March 9, 2020. This dividend is designated as an “eligible dividend” for the purposes of the Income Tax Act (Canada). Dividends paid by B2Gold to shareholders outside Canada (non-resident investors) will be subject to Canadian non-resident withholding taxes.  

As part of the Company’s long-term strategy to maximize shareholder value, B2Gold expects to declare future dividends quarterly at the same level (which on an annualized basis would amount to $0.04 per common share). The declaration and payment of future dividends and the amount of any such dividends will be subject to the determination of the Board of Directors, in its sole and absolute discretion, taking into account, among other things, economic conditions, business performance, financial condition, growth plans, expected capital requirements, compliance with the Company’s constating documents, all applicable laws, including the rules and policies of any applicable stock exchange, as well as any contractual restrictions on such dividends, including any agreements entered into with lenders to the Company, and any other factors that the Board of Directors deems appropriate at the relevant time. There can be no assurance that any dividends will be paid at the intended rate or at all in the future.  

Contact Information:

B2Gold Corp








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