Caledonia Mining Corp PLC (CMCL) Q1 2025 Earnings Call Highlights: Record Profits and Strategic ...

Yahoo

13-05-2025

Release Date: May 12, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Caledonia Mining Corp PLC (CMCL) reported a strong financial performance in Q1 2025, with record gross profit doubling from $14 million to $27 million.
The company achieved a 46% increase in revenue, reaching $56.2 million, driven by a 9% increase in gold production and a 42% rise in the average realized gold price.
Operational improvements led to a record production of 19,000 ounces of gold, supported by strategic actions such as improved employee health and safety and decoupling of the plant and mine.
Caledonia Mining Corp PLC (CMCL) strengthened its balance sheet with a pro forma consolidated net cash position improving to $18.6 million following the completion of the solar sale.
The company is actively pursuing cost reduction initiatives, including the optimization of the central shaft and the deployment of a time and attendance program to manage labor costs.
Production costs increased by 19% due to higher labor, power, and consumable costs, impacting the overall cost structure.
The all-in sustaining cost was higher than the comparative quarter, influenced by increased admin and capital expenditure.
Forex losses, both realized and unrealized, continue to impact financial results, although efforts are being made to manage these effects.
The company faces challenges in maintaining grade levels, with strategic actions needed to open up reserves in better grade areas.
There are concerns about the upfront capital costs for the Bilbos project, with ongoing efforts to optimize project economics and minimize equity dilution.
Warning! GuruFocus has detected 7 Warning Signs with CMCL.
Q: James, you've provided a lot of data about the mine. Can you update us on the longer-term aspects of mine development, particularly the declines and other work? A: Unidentified_3 (COO): We've decided to focus on mining shallow reserves closer to the surface, which are less costly in terms of ventilation and energy. However, in the medium to long term, we will need to restart the declines and go deeper.
Q: Regarding Blanket dividends, what were the dividends in 2024, and how much do you expect to extract from Blanket to fund other business areas? A: Unidentified_1 (CEO): Blanket is not a cash trap, and we aim to distribute as much cash as possible without over-distributing. At the current rate, facilitation loans should be repaid in about 12 months. Unidentified_2 (CFO) added that they expect a cash balance of $50 to $60 million by year-end.
Q: With your current commitments, is it the right time to divest smaller exploration projects like Molly Green? A: Unidentified_1 (CEO): We have no intention of selling Molly Green as it is being incubated. We are focused on our current projects and have enough on our plate.
Q: You set aside $41 million in CapEx for 2025. How much has been spent so far? A: Unidentified_2 (CFO): Approximately $10 million has been spent across both Blanket and Bilbos. The main challenge is the speed of spending due to procurement and service provider lead times, not cash availability.
Q: With increased cash generation, will most of your CapEx for the rest of the year come from internal cash flows? A: Unidentified_1 (CEO): Yes, all CapEx is funded from internal cash generation. The $50 to $60 million cash balance expected by year-end is after CapEx spending.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.