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B2Gold's (BTG) Q1 Total Gold Production & Revenue Down Y/Y

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Zacks Equity Research
·4 min read
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B2Gold Corp’s BTG total gold production in first-quarter 2021 came in at 220,644 ounces (including 15,001 ounces of attributable production from Calibre Mining Corp.), 9% above the budget. The company reported consolidated gold production of 205,643 ounces from its three operating mines during the March-end quarter, 9% above the budget level. This marks a year-over-year decline of 17% due to planned higher waste stripping activities at the Fekola and Otjikoto mines.

Consolidated gold revenues during the January-March quarter was $362 million, down from the $380 million reported in the prior-year quarter. Gold revenues declined due to the 16% decrease in gold ounces sold, partly offset by an 11% increase in the average realized gold price. In the first quarter, the company sold 202,330 ounces of gold at an average price of $1,791 per ounce, compared to the 239,500 ounces sold at an average price of $1,588 per ounce in the year-ago quarter.

B2Gold expects lower gold production from its three operating mines in the first half of the 2021 due to planned significant waste stripping at the Fekola and Otjikoto mines. Thus, for the first half of the current year, consolidated gold production is projected to be between 365,000 ounces and 385,000 ounces. This is anticipated to increase significantly to 555,000-585,000 ounces during the second half of 2021 when mining reaches the higher-grade zones of the Fekola Pit and mining at Otjikoto reaches the higher-grade zone at the base of the Wolfshag Pit.

The company witnessed solid performances across its Fekola, Masbate and Otjikoto mine operations during the first quarter, outpacing the respective targeted production for the quarter. Backed by this, B2Gold continues to expect 2021 total annual gold production to lie between 970,000 ounces and 1,030,000 ounces. Total cash operating costs are projected between $500 per ounce and $540 per ounce. Total All-in sustaining cost (AISC) is anticipated to be $870-$910 per ounce.

The company is focused on achieving impressive operational and financial performance from its existing mines, and expanding the Fekola Mine throughput and annual gold production. The Fekola mill now has the potential to run above the annualized throughput rate of 7.5 Mtpa.

B2Gold intends to pursue additional internal growth through further exploration, development and expansion of existing projects. B2Gold is planning for heavy exploration this year, with an approximately $66-million budget, including $25-million high-quality targets for the ongoing grassroots exploration programs.

The company has based its cash-flow projection on an assumption of gold price of $1,800 per ounce. If gold price dip below this level, this might put the guidance at risk.

Price Performance

Over the past year, B2Gold’s shares have gained 13.6% compared with the industry’s growth of 6.2%.



Zacks Rank & Stocks to Consider

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

A few better-ranked stocks in the basic materials space are Impala Platinum Holdings Ltd. IMPUY, Fortescue Metals Group Ltd. FSUGY and BHP Group BHP, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Impala Platinum has an expected earnings growth rate of 195.9% for the current fiscal year. The company’s shares have surged 84% in the past year.

Fortescue has a projected earnings growth rate of 84.3% for the current fiscal year. The company’s shares have soared 182% in a year’s time.

BHP Group has an estimated earnings growth rate of 77.6% for the current fiscal year. The company’s shares have appreciated 83% over the past year.

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