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B2Gold (BTG) Q3 Earnings Beat Estimates, Revenues Up Y/Y

Zacks Equity Research

B2Gold Corp BTG delivered third-quarter 2019 adjusted earnings per share of 9 cents, surpassing the Zacks Consensus Estimate of 7 cents. Also, the reported figure surged 125% year over year.

Including one-time items, the company reported earnings of 5 cents per share compared with 1 cent per share recorded in the prior-year quarter.

B2Gold generated revenues of $311 million in the third quarter, reflecting year-over-year growth of 11%. This upside resulted from increase in the average realized gold price, partly offset by decrease in the gold ounces sold.

B2Gold Corp Price, Consensus and EPS Surprise

B2Gold Corp Price, Consensus and EPS Surprise

B2Gold Corp price-consensus-eps-surprise-chart | B2Gold Corp Quote

Operational Update

B2Gold’s consolidated gold production was a record 258,200 ounces in the reported quarter, 7% above the company’s budget. This can be attributed to solid performances across all of the company's operations. On a year-over-year basis, gold production was up 7% in the quarter under review.

The company reported consolidated cash operating costs of $443 per ounce in the reported quarter, 10% below the budgeted level and flat with the year-ago quarter. Consolidated all-in sustaining costs (AISC) of $755 per ounce were slightly below budget by 1%. However, the figure rose 17.2% year over year.

Financial Position

B2Gold’s cash and cash equivalents were $146.4 million at the end of the third quarter of 2019 compared with $350.5 million recorded at the end of the year-ago quarter. The company recorded operating cash flow of $168 million for the third quarter compared with the $143 million reported in the prior-year quarter.

On Nov 5, 2019, B2Gold’s board announced its first quarterly dividend of 1 cent per share. The dividend is payable on Dec 13 to shareholders of record at the close of business on Nov 29, 2019. The company intends to maintain the payment of a quarterly dividend at the same level in the days ahead.
 
Outlook

Backed by strong gold production so far in 2019, B2Gold remains well positioned for continued robust operational and financial performance, and produce gold at the mid-point of the previous estimate of 935,000-975,000 ounces this year. Consolidated cash costs are projected to remain low in the current year, with cash operating costs forecast to be at or below the lower end of $520 and $560 per ounce guidance, while AISC is expected to be within the company’s guided range of $835 per ounce and $875 per ounce.

Recent Development

In October, B2Gold sold its El Limon and La Libertad Gold Mines and assets in Nicaragua to Calibre Mining, for an aggregate consideration of $100 million. The deal also includes the Pavon gold project and additional mineral concessions in Nicaragua. Post the deal, B2Gold holds 93,331,666 shares in Calibre, representing approximately 30.08% stake. Through its significant equity interest in Calibre, B2Gold will be involved in the Nicaraguan operations.

Share Price Performance

Over the past year, B2Gold has gained 30.6% compared with the industry’s growth of 53.6%.


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