Release Date: February 22, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- B2Gold Corp (NAM:B2G, Financial) achieved record gold production in 2023, marking the eighth consecutive year of meeting or exceeding production guidance.
- The company reported strong financial performance with a revenue of $512 million for Q4 and $1.9 billion for the full year, driven by favorable gold prices.
- B2Gold Corp (NAM:B2G) maintained a strong balance sheet, completing a prepayment of gold revenue financing at a low cost of capital.
- The company is in a strong financial position with $306 million in cash and a fully available $700 million credit line.
- B2Gold Corp (NAM:B2G) has made significant progress on the Goose project, with construction on track and the winter ice road expected to open ahead of schedule.
Negative Points
- The company faced a tragic security incident in Mali, resulting in the loss of life and raising concerns about employee safety.
- B2Gold Corp (NAM:B2G) experienced delays in obtaining permits from the Malian government, impacting production plans for 2024.
- The new 2023 mining code in Mali has created uncertainties and led to a $200 million impairment charge for the Fekola complex.
- The company anticipates higher costs due to inflationary pressures, particularly in fuel and maintenance expenses.
- B2Gold Corp (NAM:B2G) is facing challenges in the gold equities market, with a disconnect between gold prices and the performance of gold equities.
Q & A Highlights
Q: Can you provide more detail on the increased spend and resequencing of mining activity at the river?
A: The focus is on the echo pit, which will be the first tailings facility. Additionally, we are upsizing the mining equipment to increase mining rates and reduce costs. This includes moving from 30-ton trucks to 50-ton trucks and increasing the size of the scoops.
Q: Given recent CapEx changes, do you expect higher costs in the upcoming life update?
A: While there are some inflationary pressures, such as increased fuel and maintenance costs, we are offsetting these with higher production rates. Final numbers are not yet available, but some inflationary impact is expected.
Q: How are you addressing security concerns in Mali, especially after the recent incident?
A: We are working with the government to understand the motivation behind the attack and to review our safety measures. Additional steps will be taken to improve security for our employees traveling to and from the mine.
Q: How is the underground development at Goose progressing?
A: Development is on schedule despite some operational interruptions. We are not yet drilling from underground, but surface drilling is expected to start by the end of March or early April.
Q: Are you still in discussions with the Malian government regarding the new mining code?
A: Yes, we are waiting for the government to come back with more details on the implementation of the 2023 mining code. We have made progress in our discussions, and the government is keen on getting the trucking of ore to happen.
Q: Can you provide more details on the impairment charge at Fekola?
A: The impairment is due to the new 2023 mining code, which includes higher taxes and royalties. We had to look at the combined cash flows of Fekola and the regional licenses, resulting in a non-cash impairment charge of over $200 million.
Q: How did the winter ice road construction at Goose go, and what changes were made this year?
A: The construction went well, with the road expected to open ahead of schedule. Changes included staging equipment at midway points, adding more water trucks, and optimizing routes over lakes. These adjustments have been successful.
Q: What are your plans for the Antelope deposit at Otjikoto?
A: We are conducting a scoping study to evaluate the economic potential of the Antelope deposit. Initial results are encouraging, and there is significant potential for additional discoveries within the 3-kilometer strike zone.
Q: What is the status of the royalty obligations related to the Goose project?
A: We inherited Wheaton's gold stream obligation with Sabina and bought back the maximum we could. We are comfortable with the remaining small stream. We are open to selling other royalties if reasonable offers are made.
Q: How do you view the current performance of gold equities, including B2Gold?
A: Despite strong gold prices, there is a disconnect between gold prices and gold equities. We believe B2Gold will continue to be a successful gold producer with strong financials and ESG performance, leading to increased production and cash flow in the coming years.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
