B2Gold: Fekola Mine Seems To Be Firing On All Cylinders
Nov. 26, 2018 4:40 AM ET | About: B2Gold Corp. (BTG)
(534 followers) Summary
BTG has delivered strong financial and operational performance during Q3.
Analysts' opinion and the technical chart also suggest more upside to the stock.
A positive development in the Fekola mine indicates a potential increase in shareholder value.
Increased FCFs are a support for the expansion of other mining properties.
During Q3 2018, B2Gold Corporation (BTG) reported revenue of ~$324 MM and EPS of $0.05 in line with guidance. BTG's Q4 revenue witnessed a healthy ~110% increase Y/Y. On the operational side, the company reported record production of ~242 Koz (read: thousands of ounces) of gold that was ~78% in excess of the gold production reported in Q3 2017. These favourable numbers indicate that BTG is on track to improve its financial and operational performance in the coming quarters.
Figure-1 (Source: FinancialsTrend)
In this article, I have briefly discussed the operational and financial performance during Q3 and the significant developments on BTG's major mining operations. The article discusses the resource potential of BTG's recently acquired flagship asset in Mali, namely the FM (read: Fekola mine). The FM has surprised us in terms of exploration results, gold production, and low-cost mining. With support from gold prices and positive production results from BTG's other mining assets, I see a great opportunity for BTG to witness share price growth, going forward.
Financial and operational performance at a glance:
During Q3, revenue stood at $324 MM (Q3 2017: $154 MM) from the sale of ~269,000 oz of gold (Q3 2017: 122,000 oz). The company produced ~242,000 oz and had to sell some of its existing gold inventories to pay the convertible notes on October 1st. The sales were partially affected by a decline in the average price of gold. In Q3 2018, BTG realized an average price of ~$1,206/oz of gold that was substantially lower than the average price realized in Q3 2017 (~$1,267/oz).
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