The Sabodala-Massawa BIOX Expansion project
London- and Toronto-listed Endeavour Mining continued to make progress in meeting its strategic objectives for the first half of this year, achieving first gold at both its growth projects.
Not only will this improve the geographic diversification and quality of the company’s portfolio, but it will also underpin a stronger performance for the second half of this year, CEO Ian Cockerill says.
First gold pours were achieved on budget and on schedule at the Sabodala-Massawa BIOX Expansion project, in Senegal, and the Lafigué project, in Côte d’Ivoire, during the second quarter, with both projects on track to ramp up to nameplate capacity in the third quarter.
Further, Endeavour remains on track to meet its production guidance for the twelfth consecutive year, with performance strongly weighted towards the second half of the year owing to stronger performances expected at the Houndé project, in Burkina Faso, as well as at Lafigué and the Sabodala-Massawa BIOX Expansion.
Production for the six months to June 30 was 470 000 oz at an all-in sustaining cost (AISC) of $1 237/oz, while second-quarter production was 251 000 oz at an AISC of $1 287/oz.
AISC for the full year is expected to be near the top-end of the range, compounded by the lower grid power availability in Côte d’Ivoire and Burkina Faso during the first half of the year; higher royalty rates owing to the higher gold prices; and lower production at Sabodala-Massawa.
“We have already seen significant improvements in power availability in [the second] quarter that will support an improved second-half performance,” Cockerill avers.
Endeavour achieved adjusted earnings before interest, taxes, depreciation and amortisation of $249-million for the second quarter, up 17% over the previous quarter.
Adjusted net earnings for the quarter were $3-million and operating cash flow was $258-million.
The company says it is in a healthy financial position with stable net debt of $835-million as at June 30, while its growth phase nears completion.
As Endeavour approaches the completion of the current phase of growth, it has announced a new shareholder returns programme, that will comprise of $435-million of minimum dividends over the next two years, which the company expects to supplement with additional dividends and share buybacks.
For the first half of this year, Endeavour declared a $100-million dividend, which it has supplemented with an additional $20-million of share buybacks.
Endeavour has also announced changes to its executive management team.
Executive VP and COO Mark Morcombe and Exploration executive VP Jono Lawrence are leaving to pursue other opportunities.
Cockerill says Endeavour has reorganised the leadership to strengthen the operational and technical management within the team.
Djaria Traore is the new executive VP: operations and environment, social and governance and Martin White is the new EVP CTO.
“The successful gold pours at our two growth projects during the quarter, both on budget, on schedule and in under two years, extend our record of delivery, having now built five large capital projects in West Africa in the last ten years.
“We are now focussed on advancing the Assafou project on the Tanda-Iguela property, with a preliminary feasibility study expected by year-end. At the same time, we continue to explore the Assafou deposit and the targets surrounding it, where we have identified additional shallow mineralisation in close proximity to Assafou, reinforcing the project’s potential to become a cornerstone complex for Endeavour,” Cockerill outlines. 