12 May Caledonia Mining doubles profits amid increased gold output
Caledonia Mining Corporation (LSE:CMCL) doubled its profits after production from its Blanket Mine in Zimbabwe increased by 18% during the first quarter of 2017.
Gold output at the mining firm’s primary operation totalled nearly 12,800 ounces, up from 10,800 ounces in the corresponding quarter of 2016.
Caledonia’s chief executive Steve Curtis said: “As the Blanket Mine has demonstrated in the past, increased production results in lower unit costs as the fixed cost component is spread across more production ounces.”
The firm is currently in the process of a major upgrade to the gold mine which it holds a 49% interest in, with the central shaft to be taken down by around another 400 metres to 1,080 metres.
Curtis added that he expects the extended central shaft to significantly enhance operating efficiency at Blanket.
“I expect that 2017 will be the final year of significant capital investment in the central shaft project,” he said.
Caledonia also adjusted its 2017 production target to between 52,000 and 57,000 ounces to account for work on the central shaft.