Caledonia Mining Corporation Plc · AMEX:CMCL
Caledonia Mining — FY2020 Earnings Presentation
30 slides from Caledonia Mining's earnings presentation, March 2021
Slide 1: 2020 Results Presentation
2020 Results Presentation
Slide 2: Disclaimer
Disclaimer This presentation does not constitute, or form part of, any offer to sell or issue or any solicitation of any offer to purchase or subscribe for, any shares in Caledonia Mining Corporation Plc (“Caledonia”), nor shall it (or any part of it) or the fact of its distribution, form the basis
Slide 3: 2020 Highlights
2020 Highlights Health and Safety Excellent Strong Financial Excellent Outlook Minimal effect of Covid-19 Operational Performance Central shaft almost complete – commissioning Nyanzvi initiative has Performance 32% increase in turnover to expected Q1 2021 reduced injury rates. $100m Record annual pr
Slide 4: Health and Safety
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Slide 5: Safety Performance & Training
Safety Performance & Training • In 2018 the Nyanzvi training initiative was set up to improve the safety at Blanket mine. • Due to Covid-19, in 2020 126 attendees completed the training, there were 1365 in 2019. • This increased awareness in safety procedures has led to a 60% reduction in total acci
Slide 6: COVID-19
COVID-19 Donations to the Chamber of Mines and communities in 2020 to assist Operations during the 3-week lockdown (in early April) ran at with the 93% of planned production and Covid-19 pandemic production in the whole of Q2 was only 1.2% below plan No Effect on COVID-19 restrictions had an adverse
Slide 7: Case Study: Phakama Clinic
Case Study Phakama Clinic The outbreak of COVID-19 precipitated the need for increased support to the community. We have responded with significant investment in healthcare facilities throughout 2020 For the Gwanda Community, Blanket built and equipped two isolation wards, ablution facilities and a
Slide 8: Operating Review
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Slide 9: Review of Operations
Review of Operations Tonnes Milled & Grade (2011 – Q4 2020) 5 200,000 4.5 Tonnes Milled (t) Head Grade (g/t) 150,000 4 100,000 3.5 3 50,000 Achieved grade was 3.21g/t 2.5 - Q4 Q3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q1 Q2 Q4 2011 20
Slide 10: Electricity
Electricity Blanket Mine currently uses grid power as its primary source of electricity which is subject to interruptions and is unstable Our commitment to sustainable development requires us to integrate To minimise the adverse effect of power interruptions, Blanket has installed diesel generators
Slide 11: Solar PV Project
Solar PV Project OUR DRIVE TOWARDS A MORE SUSTAINABLE FUTURE The project is APPROVED THE CONSTRUCTION OF A 12MW SOLAR PLANT AT A COST OF expected to reduce APPROXIMATELY $12 MILLION Caledonia’s GHG emissions, improve • Expected to reduce Blanket’s dependence on grid power and improve the quality rel
Slide 12: Financial Review
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Slide 13: Results Highlights
Results Highlights Year to December 31 2018 2019 2020 Change 2019 to 2020 Production (ounces) 54,511 55,182 57,899 5% Average gold price ($ per ounce)1 1,245 1,382 1,749 27% Revenue ($’m) 68.4 75.8 100.0 32% Gross Profit ($’m) 2 21.6 31.1 46.7 50% Adjusted profit attributable to shareholders ($’m)1
Slide 14: Review of Results: Profit and Loss
Review of Results Profit and loss Year to December 31 2018 2019 2020 Change ($’m) Revenue 68.4 75.8 100.0 32% 4% higher sales; 27% higher gold price Royalty (3.4) (3.9) (5.0) 28% Royalty payable to Zimbabwe Government remains at 5% Production costs (39.3) (36.4) (43.7) 20% Includes “non-controlled c
Slide 15: Review of Results: Production Costs
Review of Results Production Costs Year to December 31 ($’m) 2019 2020 Change Wages and salaries1 13.9 16.1 16% 12% increase in man-hours worked; new bonus structure Consumables1 13.0 14.9 15% Increased cost of maintaining trackless equipment Covid consumables1 0.0 0.8 n/a Electricity - ZESA2 5.9 6.
Slide 16: Review of Results: G&A
Review of Results G&A Year to December 31 2019 2020 Change ($’000’s) Investor relations 414 353 (15%) Lower due to covid restrictions on physical events Audit fee 237 288 22% Includes non-audit work Advisory service fees 408 904 122% Increased activity in 2020: TSX de-listing; SEC F-3 filing; legal
Slide 17: Review of Results: Cost per ounce
Review of Results Cost per ounce Year to December 31 2019 2020 Change ($/oz) On Mine cost per ounce1 651 744 14% 2020 includes $3.2m of “non-controlled” operating costs2, equivalent to approx. $56/oz3 (2019: “non-controlled” costs of $0.6m2 – approx. $11/oz3) 2020 includes $3.2m of non-controlled op
Slide 18: Review of Results: Taxation
Review of Results Taxation Zimbabwe South Africa UK Total Income tax 8,153 762 - 8,915 • Taxation principally arises in Zimbabwe; income tax in South Africa on inter-company profits Withholding tax • Zimbabwe calculation is opaque: tax computations - management fees - 122 - 122 are done using RTGS$
Slide 19: Review of Results: Cash Flow
Review of Results Cash Flow Year to December 31 2018 2019 2020 ($’m) Cash flow before working capital 25.8 28.1 42.5 Robust cash generation Working capital (4.7) (4.2) (4.5) Higher inventories and erosion of supplier credit Net interest (0.1) (0.3) (0.3) Minimal debt – small working capital faciliti
Slide 20: Review of Results: Balance Sheet
Review of Results Balance Sheet As at December 31 ($’m) 2018 2019 2020 Non-current assets 97.5 113.7 133.3 Continued investment in the Central Shaft Current assets (excl. cash) 16.7 20.4 23.8 Higher inventories; reduced receivables Cash and equivalents 11.2 9.4 19.1 Minimal debt – small working capi
Slide 21: Dividend
Dividend COMMITTED TO RETURN MONEY TO SHAREHOLDERS QUARTERLY DIVIDEND PAYMENTS 12 Jan. 2021 Quarterly dividend of US$0.11 (11c) 10 60% increase in dividend since Oct 2019 Annualised yield of 3.2% 8 US Dollars 6 Dividend payer since 4 2012 Total dividend cost $1.34m per quarter 2 0 Q1 2018 Q2 2018 Q3
Slide 22: Outlook
Outlook A COMPANY IN THE ASCENDANCE 22
Slide 23: Investing in growth to 80,000oz/year from 2022
Investing in growth to 80,000oz/year from 2022 CONSTRUCTING A NEW MINE BELOW THE CURRENT WORKINGS (2015 TO 2021) Central Shaft will 6m diameter, 4-compartment shaft Shaft sinking completed in July 2019; result in a major from surface to 1,200m shaft equipping completed improvement in Commissioning o
Slide 24: The Zimbabwe Opportunity: Connemara North
The Zimbabwe Opportunity CONNEMARA NORTH Acquired an option for the northern section of the property, for a period of 18 months with the right to explore and to subsequently acquire the mining claims The total consideration would be $5.3 million (payable in cash or shares) and a 1% net smelter royal
Slide 25: The Zimbabwe Opportunity: Glen Hume
The Zimbabwe Opportunity GLEN HUME Option agreement with The total consideration Attractive grass roots Exploration drilling has right to explore for up to would be $5 million and exploration project already commenced using 15 months and a 1% net smelter royalty covering approximately contract subse
Slide 26: Sustainability
Sustainability A RESPONSIBLE MINER 26
Slide 27: Environment, Social & Governance
Environment, Social & Governance CALEDONIA IS A SOCIALLY CONSCIOUS & RESPONSIBLE BUSINESS CORPORATE GOVERNANCE & ETHICS HEALTH & SAFETY OUR PEOPLE • We operate on Honesty, Integrity, Respect & • We aim for a zero-harm work environment with • 99% of our employees are Zimbabwean, and our Trust, and ou
Slide 28: Corporate Social Responsibility
Corporate Social Responsibility CALEDONIA IS A SOCIALLY CONSCIOUS RESPONSIBLE BUSINESS OUR CSR STRATEGY IS DESIGNED TO DELIVER A STRATEGIC, SUSTAINABLE RESPONSE TO SOME COMMUNITY NEEDS. OUR FOCUS AREAS ARE DEFINED UNDER THE FOLLOWING FIVE SUSTAINABILITY PILLARS: Women & Youth Education Health Agricu
Slide 29: Strategy & Outlook
Strategy & Outlook INCREASED FREE CASH FLOW TO GROW DIVIDENDS AND INVEST FOR FURTHER PRODUCTION Increase production to 80,000 ounces Increased cash flows due to higher Continued deep level exploration to per annum from 2022 production, lower unit costs and extend the life of mine beyond 2034 reduced
Slide 30: Contacts
Website: www.caledoniamining.com Twitter: @CaledoniaMining Contacts Share Codes: NYSE American – CMCL / AIM – CMCL Caledonia Mining Investment Research London Financial PR: Blytheweigh Mark Learmonth, CFO WH Ireland: www.whirelandplc.com Tim Blythe Tel: +44 (0) 1534 679800 Cantor Fitzgerald: www.can