Caledonia Mining Share Discussion Threads

[ntv] 03/6/2020 06:06

$16.98 close in the US last night giving a UK price of £13.50 approx, based @$1.255

[ntv] 02/6/2020 13:53

up another 2.5% in the US to $16.5= £13.10
Discount /premium growing

[ntv] 02/6/2020 07:58

Anyone know if you can buy in the UK and sell int US as there seems to be a 50p discount/premium either way

[ntv] 01/6/2020 14:40

weird pre market in the states with what seems to be a small trade @$20

[kalkanite62] 01/6/2020 14:18

Stockopedia has the 2020 (EPS) brokers consensus increasing from $1.61 in May to $2.19 in June. I've not seen any recent brokers notes but that is a hefty 36% increase from last month.

[mikkydhu] 18/5/2020 15:16

When the company has selected a brownfield site, I look forward to the announcement of it because presumably the company will have evidence of resources and drilling grades, and with any luck they will have something worthwhile to share with us.

[cpap man] 14/5/2020 13:35

SP Angel . Morning View . Gold prices likely to rise if second wave COVID.19 hit major economies

Tuesday 12th May 2020

Caledonia Mining* (CMCL LN) 1072.5, Mkt Cap £116.6m – Quarterly results show little impact of Covid19 and improving operating environment in Zimbabwe

Caledonia Mining reports an increase in both gross profit and EBITDA during the quarter to 31st March 2020, with gross profit increasing by 146% to $10.6m (Q1 2019 - $4.3m) and EBITDA rising by 162% to $10.2m (Q1 2019 - $3.9m).

The result reflects increased gold production of 14,233oz of gold (Q1 2019 – 11,948oz) and a reduction in mine costs of $678/oz (Q1 2019 – 794/oz) and all in sustaining costs of $879/oz (Q1 2019 - $1,039/oz).

ʺCaledonia ended the Quarter with net cash and cash equivalents of $13.8 million – an increase of $4.9 million over the course of the Quarter.ʺ

The company also reports that it has completed the purchase of an additional 15% interest in the Blanket mine bringing its interest to 64%.

Caledonia Mining confirms that ʺCOVID 19 had a negligible effect on production and capital projects in the Quarter … because lockdowns were only implemented by the Zimbabwe and South African governments to manage the virus at the end of the Quarter. During the lockdowns, which extended for much of April, Blanket achieved approximately 93 per cent of its normal target production by using its stocks of consumables and implementing measures to safeguard employees. In early May, Blanket resumed full production and I expect production to continue as planned provided Blanket’s workforce remains healthy and its supply chains and access to market for the gold produced remain open.ʺ

The company also pointed to an improved operating environment in Zimbabwe with CEO, Steve Curtis, explaining that ʺAlthough the country continues to face challenges, the introduction of the interbank rate early in 2019 allows us to better protect our workers from the effects of high inflation. The interruptions to the supply of electricity from the grid which we experienced last year have largely been addressed following the conclusion of an agreement whereby Blanket (and other gold producers) purchases power which is imported into Zimbabwe. This power is cheaper than under the previous arrangement and Blanket can manage the reduced incidence of power interruptions using its increased suite of diesel generators.ʺ

· Mr. Curtis also said that ʺWe are also well-advanced in the evaluation of a solar project to provide some of Blanket’s power supply and reduce its dependence on imported power during daylight hours.ʺ

He also provided a progress report on the progress of the company’s strategic redevelopment of the Blanket mine and confirmed that ʺThe Central Shaft is the focus of our investing activities: when it is commissioned, Blanket will be able to increase production to the target rate of approximately 80,000 ounces of gold per annum. Work on Central Shaft continued throughout the lockdowns; however, completion of the project requires specialised equipment and contractors to travel to Blanket from South Africa which under the restrictions is not currently possible. This has not yet resulted in a significant delay to the project and we are receiving a high level of support from the Zimbabwe government to address these issues with the relevant authorities in South Africa.ʺ

As previously announced, the company confirms the payment of a quarterly dividend at the rate of 7.5cents/share introduced in January 2020.

Conclusion: Increasing production as the benefits of the long-term capital development programme at the Blanket start has helped reduce unit costs and improve cash generation giving the company the opportunity to maintain its increased quarterly dividend. It is encouraging to learn of the improving operating environment in Zimbabwe and that the Covid19 virus and resulting mitigation measures have had little negative impact on the operations.

*SP Angel mining analysts have visited Caledonia’s mining operations in Zimbabwe

[mikkydhu] 14/5/2020 10:42

On several recent occasions the company has mentioned its intention to pursue additional mining opportunities in Zimbabwe.

Steve Curtis, CEO, repeated this intention in his recent interview on Directors Talk. He said something will be announced in the not too distant future.
The company will soon have the funds available both to acquire and develop a suitable property. Steve pointed out that towards the end of this year the work on the new shaft will be finishing and the company's capital expenditure there will be reducing. Furthermore, there will be greatly increased production from the Blanket Mine. This will enable the company "to look very aggressively" for new opportunities in Zimbabwe.

You only have to read a little of the NI 43 101 Technical Report (June 2011) on the Blanket Mine to realise the scale of the possibilities. The company are looking for a brownfield site, probably, therefore, a former gold mine that is no longer operating. Here is an extract from that NI 43 101 Report:

"The Blanket Mine is situated on the north-western limb of the Archaean Gwanda Greenstone Belt, along strike from several other gold deposits. It is one of the few remaining producing gold mines out of approximately 268 mines once worked in this greenstone belt."

268 former mines! The possibilities are absolutely enormous. If the company has access to old mining records, they may well be able to pick up the best of what has been abandoned. CMCL will have the cash. It has the mining skills. It has good working relations with the Zimbabwean authorities. I know there are issues in Zimbabwe, but there is also a lot to look forward to.

[fredfishcake] 12/5/2020 08:37

It's a tough one, as the worse case is it could overnight go to zero if the Zimbabwe government do something odd, yet it could also be a brilliant business. I feel position sizing is of importance here!

[stemis] 07/5/2020 17:08

Indeed which is why it'll never really attract a high rating. But at 75,000 oz and a gold price of, say, $1,500/oz, I reckon it'll churn out, at least, $40m maybe $45m cash a year. Even on 6 x that, that's a share price upto double the current one. They could easily pay out 150p a share dividend (cost $20m a year).

[3800] 06/5/2020 11:17

The bear case is the political and financial instability in Zimbabwe do not underestimate the mess the country is in or the level of corruption.

[pi0110] 06/5/2020 10:33

Add cheap oil and depreciating local currency v $ (salaries) thus reducing AISC and stable dividends.
All looking rather good for CMCL

[stemis] 06/5/2020 09:51

With strong Q1 production (14,233 oz) and production at 93% capacity during the brief 'lockdown', seems little reason why CMCL won't hit their 2020 target of 53,000 - 56,000 oz. A strong gold price will convert that into very robust cashflow as they complete commissioning of the central shaft.

Target for next year is 75,000 oz (an increase of 34-42%). With little capex and a decent gold price, cashflow is going to be a thing of beauty...

[stemis] 22/4/2020 21:43

Gold through $1,700/oz

[goodgrief] 21/4/2020 22:30

Shares Mag & AJ Bell hosting a webinar featuring Shanta Gold, Caledonia Mining & plus one other on 5th May starting 6pm.

[stemis] 09/4/2020 07:52

Decent first quarter and encouraging comments about the current level of production.

[sailing john] 18/3/2020 08:13

Stunning as expected. Positive outlook. A safish haven in difficult times.

[stemis] 18/3/2020 07:50

Stonking results from CMCL, both financially and operationally. All set now for a step change in profits from 2021 onwards and yet still on a P/E of 5.5, dividend yield of 3.8% with cash in the bank. Quality outfit.

[stemis] 16/3/2020 08:50

With gold price at $1540/oz CMCL should be relatively unaffected by the current crisis, but shares suffering from 'sell everything' sentiment and maybe people cashing in profits to take advantage of bargains to come in general market?

[troajan1] 18/2/2020 06:34

Caledonia Mining sets stage for next decade with Blanket gold mine expansion