West Africa-focused gold miner Endeavour Mining has reported strong third-quarter results and says it is well positioned to beat its full-year production guidance.
The TSX- and LSE-listed miner produced 382 000 oz at an all-in sustaining cost (AISC) of $904/oz in the third quarter, taking year-to-date output to 1.14-million ounces. Production decreased by 7% quarter-on-quarter, mainly owing to the rainy season, while AISC increased by $50/oz.
The group’s full-year guidance, which it looks set to beat, is 1.37-million to 1.5-million ounces at an AISC of $850/oz to $900/oz.
President and CEO Sebastien de Montessus noted that this would be the ninth year in a row that Endeavour would exceed its production guidance.
The gold producer reported revenue of $692-million in the quarter, down from $753-million in the June quarter, mainly owing to lower sales together with a lower realised gold price.
Adjusted earnings fell to $153-million, or $0.61 a share, from $183-million, or $0.73 a share, in the preceding quarter.
“Given this strong performance we expect to generate well in excess of $1-billion in operating cash flow for the full year, which has already significantly improved our balance sheet strength and bolstered our ability to reward shareholders,” said De Montessus.
“Having already returned $224-million in dividends and share buybacks this year, and considering our near zero net debt to adjusted Ebitda leverage ratio, we expect to continue to supplement our shareholder return programme with further share buybacks and deliver more than the guided minimum dividend of $125-million for the full year.”
Commenting on the group’s growth projects, De Montessus said that Endeavour’s growth pipeline continued to develop with the Sabodala-Massawa Phase 1 expansion, in Senegal, on track for completion in the fourth quarter.
The definitive feasibility studies for the Sabodala-Massawa Phase 2 expansion, and the Fetekro and Kalana projects, in Cote d'Ivoire and Mali respectively, were progressing well, he added.
"We expect to publish the results from all three studies in the first quarter of next year."