Caledonia Mining’s (LON:CMCL, TSE:CAL) first quarter results charted a period of transition financially and operationally for the gold miner.
And crucially it also marked the implementation of the first phase of a landmark indigenization deal brokered with the Zimbabwe authorities.
Operationally it was a mixed picture. Blanket’s production was down on the previous quarter at 9,164 ounces due to scheduled maintenance on the Number 4 Shaft.
In April, however, it bounced back to 3,722 ounces, or an annualized equivalent rate of 44,664 ounces. Caledonia is targeting a 40,000 ounce annual production rate.
The lower production and certain “anticipated non-recurring costs” meant the cash cost increased to US$648 an ounce from US$521 in the preceding quarter.
However Caledonia weighed in with a net profit for the quarter of US$7.11 million, up from US$1.36 million in the previous quarter and US$1.89 million at the same point last year.
It now has cash and equivalents of US$16.3 million, up from US$2.2 million a year ago.
Separately, the indigenization of the Blanket Mine moved a step closer in the period when Caledonia agreed the sale of 15 per cent stake to a consortium for US$11 million.
It is part of multi-staged agreement unveiled in February.
This will see 10 per cent sold to the Blanket Mine Employee Trust, 16 per cent sold National Indigenisation and Economic Empowerment Fund and 10 per cent donated to the Gwanda Community Share Ownership Trust.