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B2Gold's (BTG) Earnings Miss Estimates in Q2, Decline Y/Y

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B2Gold Corp BTG reported adjusted earnings per share of 5 cents for second-quarter 2021, missing the Zacks Consensus Estimate of 7 cents. The bottom line also plunged 54.5%, year over year, mainly on lower gold production as a result of planned significant waste stripping campaigns at both the Fekola and Otjikoto mines, as well as higher cash operating costs. The 4% increase in average realized gold price in the quarter somewhat mitigated the impact.

Including one-time items, the company reported earnings of 6 cents per share compared with the prior-year quarter’s 12 cents per share.

B2Gold generated revenues of $363 million in second-quarter 2021, reflecting a year-over-year decline of 18%. This downside resulted from the 22% reduction in gold ounces sold, partly offset by 4% increase in the average realized gold price. The top-line figure came in line with the Zacks Consensus Estimate.

During the June-end quarter, B2Gold recorded consolidated gold production of 197,380 ounces, down 17.6% year over year due to the planned significant waste stripping campaigns at the Fekola and Otjikoto mines. Total gold production (including 33% interest in Calibre) in the quarter was 211,612 ounces, down 12% from the prior-year period.

The company reported consolidated cash operating costs of $649 per ounce in the reported quarter, up 69% from the year-ago period due to lower gold production and higher period stripping activities. Consolidated all-in sustaining costs (AISC) of $1,011 per ounce came in 42% higher than the prior-year quarter.

In the April-June quarter, total cost of sales was $235 million, up 15% year over year.

Gross profit plummeted 46% year over year to $128 million. Gross margin contracted to 35.2% in the reported quarter from the prior-year quarter’s 53.8%.

Operating income in the reported quarter was $109 million, reflecting a year-over-year slump of 48%. Operating margin was 30% compared with the year-ago quarter’s 48%.

B2Gold Corp Price, Consensus and EPS Surprise

B2Gold Corp Price, Consensus and EPS Surprise
B2Gold Corp Price, Consensus and EPS Surprise

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

Financial Position

B2Gold’s cash and cash equivalents were $382 million at the end of the second quarter compared with the $480 million witnessed at the end of 2020. The company utilized $8.3 million cash in operating activities in the second quarter against the prior-year quarter’s cash generation of $238 million. The company’s long-term debt was $62 million as of Jun 30, 2021, down from $76 million as of Dec 31, 2020.

Outlook

B2Gold expects to meet or exceed the current-year total production guidance of 970,000-1,030,000 ounces. Cash operating costs are projected between $500 per ounce and $540 per ounce. Meanwhile, AISC is anticipated to be within $870 per ounce to $910 per ounce.

Share Price Performance

Over the past year, B2Gold has depreciated 43.3% compared with the industry’s loss of 23.1%.

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Zacks Investment Research


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Zacks Rank & Stocks to Consider

B2Gold currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the basic materials space include Nucor Corporation NUE, Cabot Corporation CBT and Dow Inc. DOW.

Nucor has a projected earnings growth rate of 455% for the current year. The company’s shares have soared 130.6% in a year’s time. It currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Cabot has an expected earnings growth rate of 137% for the current fiscal year. The company’s shares have surged 42.4% in the past year. It currently sports a Zacks Rank #1.

Dow has an expected earnings growth rate of 403 % for the current year. The company’s shares have gained 45.4% in the past year. It currently carries a Zacks Rank #2 (Buy).


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