TORONTO (miningweekly.com) – Canadian gold miner B2Gold has swung to an adjusted net loss for the September quarter as lower gold sales at lower prices hurt the bottom line.

The Vancouver-based miner said in a statement that gold output for the period was 90 192 oz, about 14% below budget and 9% less than in the same quarter last year.

Gold production was temporarily affected by implementation issues of the semi-autogenous grinding (SAG) mill at the Masbate mine, in the Philippines, as well as continued installation delays for a dewatering system at the Limon mine, in Nicaragua, and mining in a lower-grade area.

However, B2Gold reported that Masbate's new SAG mill was now running consistently and the mine was expected to complete the year with a strong fourth quarter. In October, the Masbate mine achieved record monthly gold output of 20 423 oz, 4 029 oz ahead of budget.

At Limon, the new dewatering system was completed early this month, allowing access to higher-grade ore. The Limon mine, where lower grades were temporarily processed, was expected to resume normal operations/gold production levels in December.

As a result of lower output, consolidated cash operating costs an ounce were higher in the third quarter at $732/oz, compared with guidance of $689/oz and $653/oz in the third quarter of 2013. Consolidated cash operating costs an ounce were expected to decrease in the fourth quarter, as gold output rose.

Consolidated all-in sustaining costs (AISC) were $1 117/oz of gold. The company said it expected AISC to be lower in 2015, as the low-cost Otjikoto mine, in Namibia, started production.

B2Gold readjusted its 2014 output guidance to between 380 000 oz and 385 000 oz of gold, which was lower compared with the previous guidance of 395 000 oz to 420 000 oz of gold. Consolidated cash operating costs for the full-year 2014 were estimated to remain on track and be within the company's original guidance range of $667/oz to $695/oz of gold.

The Otjikoto gold project was expected to boost B2Gold’s output to between 500 000 oz and 540 000 oz in 2015.

Otjikoto was scheduled to pour first gold in December and ramp up to full production capacity in the first quarter. For 2015, the Otjikoto mine was expected to produce between 140 000 oz and 150 000 oz of gold at a cash operating cost in the $500/oz to $525/oz range. Once the planned mill expansion had been completed in the third quarter of 2015, the company expected gold output from the main Otjikoto pit to increase significantly to about 200 000 oz in 2016 and 170 000 oz in 2017.

Developing the Wolfshag zone, next to the main Otjikoto pit, would enhance Otjikoto’s production. The company expected to complete an updated indicated resource study in the first quarter of 2015, along with an updated mine plan by the end of 2015, which would evaluate openpit and underground mining at Wolfshag.

For the third quarter ended September 30, B2Gold reported a net loss of $274.1-million, or $0.39 a share, compared with net income of $7.9-million, or $0.01 a share, in the equivalent period of 2013.

Earnings were hit by a $202.1-million noncash impairment charge on the Masbate mine and a $96.3-million noncash impairment charge relating to the company's investment in its Gramalote joint venture.

The impairment charges were mainly the result of using a lower estimated long-term gold price assumption of $1 300/oz in assessing its asset portfolio.

Gold's spot price had hit a four-and-a-half-year low of $1 131.85/oz last week and continued trading below $1 200/oz this week. The weak performance was mainly underpinned by a strengthening US economy.

For the third quarter, B2Gold reported an adjusted loss of $4.2-million, or $0.01 a share, compared with adjusted net income of $12.1-million, or $0.02 a share, in the same period of 2013. The decrease in adjusted earnings was mainly owing to lower gold revenues as a result of lower realised gold prices and ounces sold, and higher depreciation and depletion charges.

Analysts had, on average, expected adjusted earnings of $0.01 a share on revenue of $123.86-million.

Revenue in the period was $114.9-million on sales of 91 292 oz, at an average price of $1 259/oz.

At September 30, the company remained in a strong financial position with cash and cash equivalents of $179-million and working capital of $215.6-million.

The company’s stock gained 8.23% in New York on Friday amid voluminous trading, settling at $1.71 apiece.