Endeavour Achieves Top End of FY-2022 Guidance; Announces H2-2022 Dividend of $100M
NEWS RELEASE – LSE & TSX: EDV All amounts in US$
ENDEAVOUR ACHIEVES TOP END OF FY-2022 GUIDANCE; ANNOUNCES H2-2022 DIVIDEND OF $100M
FY-2022 production of 1.4Moz at AISC of ~$928/oz FY-2022 dividend of $200m FY-2022 share buyback of $99m
OPERATIONAL AND FINANCIAL HIGHLIGHTS (for continuing operations)
- Strong Q4-2022 production of 355koz, up 4% over Q3-2022, while AISC remained stable at ~$954/oz
- FY-2022 production of 1,400koz at an AISC of ~$928/oz, marking 10th consecutive year of achieving or beating guidance
- FY-2023 production guidance of 1,325-1,425koz at an industry leading AISC of $940-995/oz
- Strong financial position at year end with $121m of net cash, up $119m over Q3-2022
SHAREHOLDER RETURNS
- H2-2022 dividend of $100m declared, totaling $200m for FY-2022 which is 33% above the minimum committed dividend
- Share buyback programme continued with $24m worth of shares repurchased in Q4-2022, totaling $99m for FY-2022
ORGANIC GROWTH
- Sabodala-Massawa expansion and Lafigué greenfield project construction are both on track with 53% and 30% of the capital committed respectively, with pricing in line with expectations
- Continued strong exploration focus in 2023 with $70m Group budget; key focus area is the new Tanda-Iguela discovery
London, 23 January 2023 – Endeavour Mining plc (LSE:EDV, TSX:EDV, OTCQX:EDVMF) ("Endeavour" or the "Group" or the "Company") is pleased to announce its preliminary financial and operating results for the fourth quarter and full year 2022, with highlights provided in the table below.
Table 1: Preliminary Financial and Operating Results Highlights1 THREE MONTHS ENDED YEAR ENDED
| In US$ million unless otherwise specified | 31 December | 30 September | 31 December 2021 | 31 December | 31 December 2021 | Δ FY-2022 |
| 2022 | 2022 | 2022 | vs. FY-2021 | |||
| PRODUCTION AND AISC HIGHLIGHTS2 Gold Production, koz Gold Sold, koz All-in Sustaining Cost3, $/oz | 343 378 338 370 959 823 | 1,436 1,478 882 | ||||
| 355 | 1,400 | (3)% | ||||
| 352 | 1,393 | (6)% | ||||
| ~954 | ~928 | +5% | ||||
| SHAREHOLDER RETURNS Shareholder dividends paid Share buyback Total shareholder returns paid | 100 — 37 44 137 44 | 130 138 268 | ||||
| — | 170 | +31% | ||||
| 24 | 99 | (28)% | ||||
| 24 | 269 | —% | ||||
| ORGANIC GROWTH Growth capital spend | (30) (12) | (63) | ||||
| (56) | (128) | +103% | ||||
| FINANCIAL POSITION HIGHLIGHT1 Cash Principal debt Net cash | 833 906 (830) (830) 3 76 | 906 (830) 76 | ||||
| 951 | 951 | +5% | ||||
| (830) | (830) | n.a. | ||||
| 121 | 121 | +59% |
1All Q4-2022 and FY-2022 numbers are preliminary and reflect Endeavour's expected results as at the date of this press release. 2Production and AISC highlights from continuing operations 3This is a non-GAAP measure.
Sebastien de Montessus, President and CEO, commented: “2022 was another successful year for Endeavour in which we delivered against all our objectives and met guidance for the 10th consecutive year.
We produced 1.4Moz of gold over the year, reaching the top end of our guidance. We are particularly pleased to have achieved our all-in sustaining cost guidance of below $930/oz, despite the inflationary pressures impacting the industry, as a result of our strong production performance and optimisation initiatives.
This operational performance resulted in robust cash flow generation which has allowed us to fund both our growth and shareholder returns programme while also improving our financial position. We are excited by our growth prospects given construction activities for the Sabodala-Massawa expansion and the Lafigué greenfield project are progressing well, with both on budget and on track for first production in 2024. Moreover, our exploration programme was very successful with the discovery of the promising Tanda-Iguela deposit, which has the potential to be another cornerstone asset for the Company.
During 2022, we continued to deliver on our commitment to generate attractive shareholder returns with approximately $100 million of share buybacks completed and $200 million of dividends announced for the year, which is well above our $150 million minimum commitment. This represents a return to shareholders of $212/oz of gold produced in the form of dividends and buybacks.
With a strengthened management team, we look forward to further success in 2023, with our guidance demonstrating confidence in our continued ability to deliver against our strategic objectives for the benefit of all our stakeholders.”
2022 SCORECARD
The key targets set for 2022, along with the results achieved, are summarised in Table 2 below.
Table 2: 2022 Scorecard
| 2022 TARGET | 2022 ACHIEVEMENT | |
| Production, koz AISC, $/oz Leverage Total shareholder capital returns | 1,315 - 1,400 | 1,400 ~928 $121m net cash $299m shareholder returns |
| 880 - 930 | ||
| <0.5x Net Debt/adj. EBITDA LTM | ||
| $150m minimum dividend |
MANAGEMENT CHANGES
As part of its continuous efforts to optimise the business and deliver Endeavour's next growth phase, the Company is pleased to announce several changes to its senior management team.
In March 2023, Joanna Pearson will be stepping down as EVP and Chief Financial Officer ("CFO") and will be replaced by Guy Young. Mr. Young will join Endeavour from Vesuvius plc, the FTSE250 molten metal engineering and technology group, where he has been Chief Financial Officer since 2015. Prior to this, he served as Chief Financial Officer of Tarmac and subsequently Lafarge Tarmac, the British building materials company. He previously held a number of senior financial and business development positions at Anglo-American plc. In addition, Martino De Ciccio, currently Vice President of Strategy and Investor Relations, will assume the newly created role of Deputy CFO, maintaining his focus on investor relations.
Further changes have also been made to the Company's senior team to reflect the company's evolution over the past years. The Executive Committee will now be composed of ten members comprised of Sebastien de Montessus as CEO, Mark Morcombe as Chief Operating Officer, Guy Young as CFO, Morgan Carroll as EVP Corporate Finance and General Counsel, Pascal Bernasconi as EVP Public Affairs and Security, David Dragone as EVP HR and Communications who recently joined the Group, Martin White as EVP Projects (previously General Manager at Endeavour's Mana mine), Jono Lawrence as EVP Exploration (previously SVP Exploration), Guenole Pichevin as EVP Strategy and Business Development (previously VP Strategy and Business Development), and Djaria Traore as EVP ESG and Supply Chain (previously VP Supply Chain).
In accordance with Endeavour’s succession planning strategy, Jono Lawrence replaces Patrick Bouisset who retired on 31 December 2022. Subject to shareholders approval at the next Annual General Meeting in May 2023, Mr. Bouisset is expected to be appointed to the Endeavour Board as a Non-Executive Director and a La Mancha representative, replacing Jim Askew who has decided to retire and will not therefore stand for re-election. The Company confirms that there is no further information to be disclosed in respect of Mr. Bouisset’s appointment under the FCA’s Listing Rule 9.6.13.
SHAREHOLDER RETURNS PROGRAMME
- Endeavour is pleased to announce its H2-2022 interim dividend of $100 million or approximately $0.41 per share based on its current issued share capital. As such, the total dividend amounts to $200 million or approximately $0.81 per share for FY- 2022, which represents $50 million or 33% more than the minimum dividend commitment for the year, reiterating Endeavour's strong commitment to paying supplemental shareholder returns.
- The ex-dividend date for the H2-2022 interim dividend will be 23 February 2023 and the record date will be 24 February 2023. The dividend will be paid on or about 28 March 2023 (the “Payment Date”). Shareholders of shares traded on the Toronto Stock Exchange will receive dividends in Canadian Dollars (“CAD”), but can elect to receive United States Dollars (“USD”). Shareholders of shares traded on the London Stock Exchange will receive dividends in USD, but can elect to receive Pounds Sterling (“GBP”). Currency elections and elections under the Company's dividend reinvestment plan ("DRIP") must be made by shareholders prior to 17:00 GMT on 7 March 2023. Dividends will be paid in the default or elected currency on the Payment Date, at the prevailing USD:CAD and USD:GBP exchange rates on 13 March 2022. This dividend does not qualify as an “eligible dividend” for Canadian income tax purposes. The tax consequences of the dividend will be dependent on the particular circumstances of a shareholder.
- Shareholder returns are being supplemented through the Company’s share buyback programme. A total of $98.7 million, or 4.6 million shares were repurchased during FY-2022, of which $24.2 million or 1.2 million shares were repurchased in Q4- 2022.
- As shown in Table 3 below, Endeavour returned $299 million to shareholders for FY-2022 through dividends and share buybacks, equivalent to $212 per ounce produced. Since the launch of the Company’s shareholder returns programme in early 2021, a cumulative $637 million (including the upcoming H2-2022 dividend) has been delivered to shareholders in the form of dividends and share buybacks.
Table 3: Actual Shareholder Returns vs. Minimum Commitment
| All amounts in US$ million | MINIMUM | ACTUAL SHAREHOLDER RETURNS | SUPPLEMENTAL | ||
|---|---|---|---|---|---|
| DIVIDEND | DIVIDENDS | BUYBACKS | TOTAL RETURNS | SHAREHOLDER | |
| COMMITMENT | COMPLETED | RETURNS | |||
| FY-2020 FY-2021 FY-20221 | 60 | 60 — 60 140 138 278 200 99 299 | — | ||
| 125 | +153 | ||||
| 150 | +149 | ||||
| TOTAL | 335 | 400 | 237 | 637 | +302 |
1H2-2022 dividend declared on 23 January 2023, to be paid on or about 28 March 2023.
FINANCIAL POSITION & LIQUIDITY
- As shown in Table 4 below, a net cash position of $121.1 million was achieved at year end, which represents an improvement of $118.6 million compared to the prior quarter and $44.9 million over the previous year. In addition to improving the balance sheet, the Company paid $170.0 million in dividends and $98.7 million in share buybacks during the year and incurred $127.7 million of growth capital spend.
Table 4: Net Debt Position1
| In US$ million unless otherwise specified. | 31 December 2021 | ||
|---|---|---|---|
| 31 December 2022 | 30 September 2022 | ||
| Cash and cash equivalents Principal amount of Senior Notes Convertible senior bond | 951 | 833 906 (500) (500) (330) (330) | |
| (500) | |||
| (330) | |||
| NET CASH / (NET DEBT) POSITION | 121 | 3 | 76 |
1All Q4-2022 and FY-2022 numbers are preliminary and reflect our expected results as of the date of this press release.
- At 31 December 2022, Endeavour’s available sources of financing and liquidity remained strong at approximately $1.53 billion, which included approximately $951 million from its current cash position and $575 million in undrawn funds from its revolving credit facility, which has been upsized from $500 million to $575 million to provide additional liquidity headroom during the Company's ongoing construction phase. As a result, the Company has significant financial flexibility to settle the principal amount of its outstanding convertible bond in cash at its maturity on 15 February 2023.
2022 OPERATIONAL PERFORMANCE OVERVIEW
- FY-2022 production from continuing operations amounted to 1,400koz, achieving the top end of the guided 1,315-1,400koz range while all-in sustaining costs ("AISC") amounted to ~$928/oz, achieving the guided $880-930/oz range in spite of industry-wide inflationary pressures. The production out-performance is mainly due to the Houndé and Ity mines which benefitted from higher than planned throughput, and the Mana mine where higher than expected open pit mining tonnages were extracted from the Wona open pit prior to its depletion. Inflationary pressures on costs were partially offset by favourable foreign exchange movements as the Euro declined against the Dollar as well as group-wide optimisation initiatives.
- FY-2022 production from continuing operations decreased by 36koz or 3% from 1,436koz in FY-2021 to 1,400koz in FY-2022 due to lower production at Boungou, Mana and Wahgnion as a result of mining and processing of lower grade ore. AISC from continuing operations increased, in line with guidance, from $882/oz in FY-2021 to $928/oz in FY-2022.
- The Group’s realised gold price from continuing operations, excluding the impact of realised gains on gold hedges and inclusive of the Sabodala-Massawa gold stream, was $1,742/oz and $1,792/oz for Q4-2022 and FY-2022 respectively. Including the impact of the gold hedges, the Group's realised gold price from continuing operations was $1,758/oz and $1,807/oz for Q4-2022 and FY-2022 respectively.
Table 5: Consolidated Group Production1 THREE MONTHS ENDED YEAR ENDED
| (All amounts in koz, on a 100% basis) | 31 December 2021 | ||||
|---|---|---|---|---|---|
| 31 December | 30 September | 31 December | 31 December | ||
| 2022 | 2022 | 2022 | 2021 | ||
| Boungou Hounde Ity Mana Sabodala-Massawa2 Wahgnion2 | 26 | 29 35 72 77 81 60 42 54 86 105 32 47 | 116 | 174 293 272 205 345 147 | |
| 63 | 295 | ||||
| 82 | 313 | ||||
| 46 | 195 | ||||
| 103 | 358 | ||||
| 36 | 124 | ||||
| PRODUCTION FROM CONTINUING OPERATIONS | 355 | 343 | 378 | 1,400 | 1,436 |
| Karma3 Agbaou4 | — | — 21 — — | 10 | 67 13 | |
| — | — | ||||
| GROUP PRODUCTION | 355 | 343 | 398 | 1,410 | 1,516 |
1All Q4-2022 and FY-2022 numbers are preliminary and reflect Endeavour's expected results as at the date of this press release. 2Included for the post acquisition period commencing 10 February 2021. 3Divested on 10 March 2022. 4Divested on 1 March 2021.
Table 6: Consolidated All-In Sustaining Costs1,2 THREE MONTHS ENDED YEAR ENDED
| (All amounts in US$/oz) | 31 December 2021 | ||||
|---|---|---|---|---|---|
| 31 December | 30 September | 31 December | 31 December | ||
| 2022 | 2022 | 2022 | 2021 | ||
| Boungou Hounde Ity Mana Sabodala-Massawa3 Wahgnion3 Corporate G&A | ~1,118 | 1,219 825 716 874 773 854 1,098 1,116 779 591 1,647 1,066 37 47 | ~1,064 | 801 843 836 1,026 645 994 35 | |
| ~970 | ~809 | ||||
| ~847 | ~812 | ||||
| ~1,000 | ~994 | ||||
| ~661 | ~691 | ||||
| ~1,376 | ~1,525 | ||||
| ~41 | ~34 | ||||
| AISC FROM CONTINUING OPERATIONS | ~954 | 959 | 823 | ~928 | 882 |
| Karma4 Agbaou5 | — | — 1,256 — — | 1,504 | 1,162 1,131 | |
| — | — | ||||
| GROUP AISC | ~954 | 959 | 908 | ~933 | 897 |
1All Q4-2022 and FY-2022 numbers are preliminary and reflect Endeavour's expected results as at the date of this press release. 2This is a non-GAAP measure. 3Included for the post acquisition period commencing 10 February 2021. 4Divested on 10 March 2022. 5Divested on 1 March 2021.
2023 OUTLOOK
| • | As shown in Tables 7 and 8 below, the production guidance for FY-2023 amounts to 1,325-1,425koz, which marks an increase over the FY-2022 guidance of 1,315-1,400koz, while Group AISC is expected to remain consistent with that achieved over | FY-2023 amounts to 1,325-1,425koz, which marks an increase | ||
|---|---|---|---|---|
| over the FY-2022 guidance of | ||||
| $940-995/oz. Group production is expected to be more heavily weighted towards H2-2023. More details | ||||
| on individual mine guidances have been provided in the below sections | . |
Table 7: Production 2023 Guidance1
| (All amounts in koz, on a 100% basis) | 2022 ACTUALS | 2023 FULL-YEAR GUIDANCE | ||
| Boungou Houndé Ity Mana Sabodala-Massawa Wahgnion | 116 | 115 | — | 125 |
| 295 | 270 | — | 285 | |
| 313 | 285 | — | 300 | |
| 195 | 190 | — | 210 | |
| 358 | 315 | — | 340 | |
| 124 | 150 | — | 165 | |
| GROUP PRODUCTION | 1,400 | 1,325 | — | 1,425 |
1All FY-2022 numbers are preliminary and reflect Endeavour's expected results as at the date of this press release.
Table 8: AISC 2023 Guidance1, 2
| (All amounts in US$/oz) | 2022 ACTUALS | 2023 FULL-YEAR GUIDANCE | ||
| Boungou Houndé Ity Mana Sabodala-Massawa Wahgnion Corporate G&A | ~1,064 | 985 | — | 1,075 |
| ~809 | 850 | — | 925 | |
| ~812 | 840 | — | 915 | |
| ~994 | 950 | — | 1,050 | |
| ~691 | 760 | — | 810 | |
| ~1,525 | 1,250 | — | 1,350 | |
| ~34 | 35 | |||
| GROUP AISC | ~928 | 940 | — | 995 |
1This is a non-GAAP measure. Refer to the non-GAAP measure section of the most recent MD&A for Endeavour. All FY-2022 numbers are preliminary and reflect Endeavour's expected results as at the date of this press release. 2FY-2023 AISC guidance is based on an assumed average gold price of $1,750/oz and USD:EUR foreign exchange rate of 1.05.
- Total mine capital expenditure for FY-2023, consisting of both sustaining and non-sustaining capital spend, is expected to remain consistent with that achieved in FY-2022 at approximately $370 million, as detailed in the tables below. More details on individual mine capital expenditures have been provided in the mine sections below.
Table 9: Mine Capital Expenditure for Continuing Operations 2023 Guidance1
| (All amounts in US$m) | 2022 ACTUALS | 2023 FULL-YEAR |
| GUIDANCE | ||
| Boungou Houndé Ity Mana Sabodala-Massawa Wahgnion | 7 | 5 |
| 27 | 40 | |
| 13 | 25 | |
| 10 | 25 | |
| 40 | 45 | |
| 23 | 25 | |
| TOTAL SUSTAINING MINE CAPITAL EXPENDITURES | 120 | 165 |
| Boungou Houndé Ity Mana Sabodala-Massawa Wahgnion Non-mining | 28 | 30 |
| 39 | 35 | |
| 49 | 40 | |
| 61 | 45 | |
| 40 | 35 | |
| 32 | 15 | |
| 3 | 5 | |
| TOTAL NON-SUSTAINING MINE CAPITAL EXPENDITURES | 252 | 205 |
| TOTAL MINE CAPITAL EXPENDITURES | 372 | 370 |
1All FY-2022 numbers are preliminary and reflect Endeavour's expected results as at the date of this press release.
- Growth capital spend for FY-2023 is expected to amount to $400 million, consisting of $170 million for the Sabodala- Massawa BIOX® Expansion project and $230 million for the Lafigué project. Further details are provided in the sections below.
- As detailed in Table 10 below, exploration will continue to be a strong focus in FY-2023 with a company-wide exploration budget of $70 million, of which approximately 50% is expected to be expensed and 50% as is expected to be capitalised. For FY-2023, approximately $22 million will be spent on greenfield exploration with an increased focus on the Tanda-Iguela property.
Table 10: Exploration 2023 Guidance
| 2022 ACTUALS1 | 2023 GUIDANCE | ||
| 24 | 22 | ||
| 15 | 15 | ||
| 10 | 14 | ||
| 8 | 7 | ||
| 7 | 5 | ||
| 9 | 4 | ||
| 6 | 2 | ||
| 2 | 1 | ||
| Total | 81 | 70 | 100% |
1All FY-2022 numbers are preliminary and reflect Endeavour's expected results as at the date of this press release.
- The Company's previously implemented revenue protection programme is expected to continue to provide cash flow visibility during the current construction phase. Outstanding contracts for FY-2023 include a collar with a put price of $1,750 per ounce and a call price of $2,100 per ounce for a total of approximately 300,000 ounces, or 75,000 ounces per quarter, until Q4-2023. In addition, the Company has in place forward sales contracts for 120,000 ounces of production in FY-2023, or approximately 30,000 ounces per quarter, at an average gold price of $1,828 per ounce.
OPERATIONAL DETAILS BY ASSET
Boungou Mine, Burkina Faso
Table 11: Boungou Performance Indicators1
| For The Period Ended | Q4-2022 | Q3-2022 | Q4-2021 | FY-2022 | FY-2021 |
|---|---|---|---|---|---|
| Tonnes ore mined, kt Total tonnes mined, kt Strip ratio (incl. waste cap) Tonnes milled, kt Grade, g/t Recovery rate, % PRODUCTION, KOZ | 256 | 210 3,559 15.95 338 2.84 94 29 | 301 | 990 | 1,437 26,439 17.40 1,352 4.07 95 174 |
| 3,497 | 4,294 | 18,505 | |||
| 12.66 | 13.27 | 17.69 | |||
| 295 | 352 | 1,348 | |||
| 2.85 | 3.36 | 2.80 | |||
| 93 | 95 | 94 | |||
| 26 | 35 | 116 | |||
| Total cash cost/oz AISC/OZ | ~1,054 | 1,172 1,219 | 778 | ~1,008 | 695 801 |
| ~1,118 | 825 | ~1,064 |
1All Q4-2022 and FY-2022 numbers are preliminary and reflect Endeavour's expected results as at the date of this press release.
Q4-2022 vs Q3-2022 Insights
- Production decreased due to lower tonnes milled and a slightly lower recovery rate, while processed grades remained flat.
- Total ore tonnes mined increased due to greater ore availability and lower stripping in the West Pit compared to the prior quarter.
- Tonnes milled decreased due to downtime experienced during the quarter due to the previously disclosed supply chain challenges in the quarter.
- Average grade processed remained flat compared to the prior quarter as a decrease in the average grade of mined ore was offset by reduced reliance on lower grade stockpiles in the mill feed.
- Recovery rates decreased slightly due in part to reduced volumes in the processing circuit.
- AISC decreased due to lower mining unit costs driven by reduced haulage and blasting, partially offset by lower ounces sold during the quarter.
FY-2022 Performance
- FY-2022 production totalled 116koz, which inline with the previously disclosed outlook, stands below the guided 130-140koz range mainly due to lower than scheduled mining activities, which limited access to higher grade ore, as a result of supply chain delays. FY-2022 AISC amounted to approximately $1,064/oz, which is above the guided $900-1,000/oz range due to the lower than expected production, higher fuel prices and increased security costs.
- FY-2022 production decreased from 174koz in FY-2021 to 116koz in FY-2022 due to the impact of lower grade material available in FY-2022 due to supply chain delays. FY-2022 AISC increased from $801/oz in FY-2021 to $1,064/oz in FY-2022 due to the lower grades processed, and fuel, consumable and security cost increases.
2023 Outlook
- Boungou is expected to produce between 115-125koz in FY-2023 at an AISC of between $985-1,075/oz.
| • Mining activities in H1-2023 are expected to focus on waste stripping at the West Flank pit and ore mining in the West pit | ||
|---|---|---|
| phase 3. In H2-2023, greater ore volumes are expected to be sourced from the West Flank pit. Mill throughput is expected to | ||
| decrease slightly while grades are expected to improve year over year. Production is expected to be weighted towards H2-2023 | ||
| as higher grades will be accessed from the West Flank pit in H2-2023 after waste stripping activities wind down | . |
| • Sustaining capital expenditure is expected to decrease from approximately $6.6 million in FY-2022 to $5.0 million in FY-2023, | |
| relating mainly to waste stripping, plant maintenance and fuel storage capacity increases. |
| • Non-sustaining capital expenditure is expected to increase from approximately $27.5 million in FY-2022 to $30.0 million in FY- | |
| 2023, relating primarily to significant waste stripping activity at the West Flank pit in H1-2023. |
Houndé Mine, Burkina Faso
Table 12: Houndé Performance Indicators1
| Q4-2022 | Q3-2022 | Q4-2021 | FY-2022 | FY-2021 |
|---|---|---|---|---|
| 1,912 | 1,174 9,178 6.82 1,234 1.83 92 72 | 777 | 5,754 | |
| 12,901 | 12,297 | 45,490 | ||
| 5.75 | 14.83 | 6.91 | ||
| 1,359 | 1,226 | 5,043 | ||
| 1.55 | 2.05 | 1.92 | ||
| 92 | 94 | 93 | ||
| 63 | 77 | 295 | ||
| ~869 | 631 716 | 684 | ~717 | |
| ~970 | 874 | ~809 |
- Production decreased due to lower processed grades, which was slightly offset by higher mill throughput, while recovery rates remained flat.
- Tonnes of ore mined increased as higher volumes mined in the Kari West and Vindaloo Main pits offset lower volumes from the Kari Pump pit, where stripping activities have continued. Total tonnes mined increased due to higher utilisation of the mining fleet following the end of the wet season.
- Tonnes milled increased as there was a higher proportion of softer ore from Kari West in the mill feed enabling higher throughput rates.
- Processed grades decreased, as per the outlook previously disclosed, due to less high grade oxide ore sourced from the Kari Pump pit given the increased focus on stripping activities.
- AISC increased mainly due to increased mining volumes and lower production due to lower average grade in the ore blend in addition to higher unit milling costs.
- FY-2022 production totalled 295koz, which inline with the previously disclosed outlook, exceeded the guided 260-275koz range, due to higher than scheduled volumes of high grade ore sourced from the Kari area and better mill performance following optimisation initiatives. FY-2022 AISC amounted to approximately $809/oz, which is below the guided $875-925/oz range due to the benefit of the higher than expected production.
- FY-2022 production remained consistent with FY-2021 as increased mill throughput, driven by efficiency improvements, and improved recoveries associated with the high-grade ore sourced from the Kari Pump pit offset a lower average grade milled. FY-2022 AISC decreased from $843/oz in FY-2021 to approximately $809/oz in FY-2022 due to lower waste mining volumes.
- Houndé is expected to produce between 270-285koz in FY-2023 at AISC of $850-925/oz.
- Mining activities during the year will focus on the Vindaloo Main, Kari Pump and Kari West pits. In H1-2023, ore is expected to primarily be mined from the Kari West pit, while significant waste stripping is underway at the Kari Pump and Vindaloo Main pits. In H2-2023, greater ore volumes are expected to be mined from the Kari Pump and Vindaloo Main pits following the waste stripping in H1-2023, with Kari West continuing to provide supplemental feed. Production for the year is expected to be weighted towards H2-2023 as the waste stripping activities in H1-2023 are expected to provide access to higher grade ore sources at both the Kari Pump and Vindaloo Main pits in the second half of the year. Throughput and recoveries are expected to be slightly lower in FY-2023 compared to FY-2022 due to a greater proportion of harder fresh ore in the blend.
- Sustaining capital expenditure is expected to increase from $27.4 million in FY-2022 to approximately $40.0 million in FY-2023, relating mainly to waste stripping, fleet re-builds and plant equipment replacements and upgrades.
- Non-sustaining capital expenditure is expected to decrease from $39.2 million in FY-2022 to approximately $35.0 million in FY- 2023, and primarily relates to waste stripping activities and stage 8 and 9 of the TSF1 embankment raise.
Ity Mine, Côte d’Ivoire Table 13: Ity Performance Indicators1
| Q4-2022 | Q3-2022 | Q4-2021 | FY-2022 | FY-2021 |
|---|---|---|---|---|
| 1,662 | 1,180 4,925 3.17 1,375 2.04 87 81 | 2,234 | 7,044 | |
| 6,043 | 6,624 | 23,946 | ||
| 2.64 | 1.97 | 2.40 | ||
| 1,710 | 1,624 | 6,351 | ||
| 1.73 | 1.50 | 1.80 | ||
| 87 | 77 | 85 | ||
| 82 | 60 | 313 | ||
| ~816 | 741 773 | 749 | ~769 | |
| ~847 | 854 | ~812 |
- Production remained flat as lower processed grades were offset by higher throughput, while recoveries remained consistent.
- Tonnes of ore mined and total tonnes mined increased due to increased mining rates at the Ity and Walter pits as well as increased tonnages mined from the historic stockpiles, which was partially offset by reduced mining at the Le Plaque pit.
- Tonnes milled increased as a higher proportion of softer oxide ore from the historic heap leach stockpiles was fed through the surge bin feeder, while the previous quarter was impacted by the wet season.
- Processed grades decreased as a lower proportion of high grade material from Le Plaque was processed.
- AISC increased due to lower grade ore processed, which was partially offset by slightly lower unit mining and processing costs.
FY-2022 Performance
- FY-2022 production totalled 313koz, which in accordance with the previously disclosed outlook, was above the guided 255- 270koz range mainly due to higher than expected grades, higher recoveries associated with less processing of transitional material from Daapleu, and improved processing plant performance from increased throughput and use of the surge bin. FY- 2022 AISC amounted to approximately $812/oz, which was below the guided $850-900/oz range mainly due to the higher than expected production and grades.
- FY-2022 production increased from 272koz in FY-2021 to 313koz in FY-2022 due to an increase in throughput rates from improvements in plant operating and maintenance strategies, continued use of the surge bin providing supplemental oxide ore to the mill feed, higher average processed grades due to higher portions of high grade material from Le Plaque in the mill feed and higher recoveries due to a lower portion of fresh material from Daapleu. FY-2022 AISC decreased from $836/oz in FY-2021 to approximately $812/oz in FY-2022, driven largely by the increased production during the period.
- Ity is expected to produce between 285-300koz in FY-2023 at an AISC of between $840-915/oz.
| • For FY-2023, ore is expected to be sourced from the Ity, Bakatouo, Le Plaque and Walter pits, supplemented by historical heap | |
| leach stockpiles. Ore tonnes processed for FY-2023 are expected to remain consistent with the prior period. Grades are | |
| expected to decline compared to the prior year due to the cessation of ore mining at the higher grade Daapleu open pit in | |
| mid-2022, while recoveries are expected to increase as no Daapleu fresh material is expected in the mill feed for FY-2023. |
- Sustaining capital expenditure is expected to increase from $13.4 million in FY-2022 to $25.0 million in FY-2023 and is primarily related to waste stripping, de-watering borehole drilling and capital spares.
- Non-sustaining capital expenditure is expected to decrease from $49.0 million in FY-2022 to approximately $40.0 million in FY- 2023, mainly related to the completion of the Recyn Project which is expected to be commissioned early in H2-2023, as well as the TSF Stage 5 raise and initial design and earthworks on TSF 2. Further, the mineral sizer project is expected to be launched in H2-2023.
Mana Mine, Burkina Faso
Table 14: Mana Performance Indicators1
| For The Period Ended | Q4-2022 | Q3-2022 | Q4-2021 | FY-2022 | FY-2021 |
|---|---|---|---|---|---|
| OP tonnes ore mined, kt OP total tonnes mined, kt OP strip ratio (incl. waste cap) UG tonnes ore mined, kt Tonnes milled, kt Grade, g/t Recovery rate, % PRODUCTION, KOZ | 338 | 76 76 — 250 691 1.90 92 42 | 529 | 1,260 | 2,025 23,529 10.62 838 2,593 2.65 91 205 |
| 1,057 | 2,695 | 3,615 | |||
| 2.13 | 4.09 | 1.87 | |||
| 299 | 180 | 944 | |||
| 643 | 651 | 2,607 | |||
| 2.33 | 2.75 | 2.49 | |||
| 93 | 93 | 92 | |||
| 46 | 54 | 195 | |||
| Total cash cost/oz AISC/OZ | ~941 | 1,023 1,098 | 1,070 | ~943 | 966 1,026 |
| ~999 | 1,116 | ~994 |
1All Q4-2022 and FY-2022 numbers are preliminary and reflect Endeavour's expected results as at the date of this press release.
- Production increased due to higher processed grades and gold recovery rates, partially offset by a decrease in tonnes milled.
- Total open pit tonnes mined increased as mining activities ramped up at the Maoula open pit.
- Total underground ore tonnes mined increased as more production stopes were accessed from the Siou underground mine due to the benefit of the underground development conducted in Q3-2022. Across both underground mines, a total of 2,117 meters of development were completed during the quarter.
- Tonnes milled decreased due to planned mill maintenance, as per the outlook previously disclosed.
- The average processed grade increased due to higher grade ore feed from the Siou underground.
- Recovery rates increased slightly due to the change in the ore blend.
- AISC decreased due to higher volumes of gold sold and lower unit processing costs, partially offset by an increase in open pit mining unit costs as a result of the ramp up of mining at the Maoula open pit.
FY-2022 Performance
- FY-2022 production totalled 195koz, exceeding the guided 170-190koz range due to better than expected ore tonnage mined from the Wona open pit before it was depleted and greater volumes of ore sourced from the Siou and Wona underground mines. FY-2022 AISC amounted to approximately $994/oz, slightly below the guided $1,000-$1,100/oz range, largely due to better than expected processed grades throughout the year.
- FY-2022 production decreased from 205koz in FY-2021 to 195koz in FY-2022 largely due to lower grades milled as a result of processing more lower grade stockpiles to supplement the mill feed as open pit mining at the Wona open pit came to a close during the year. FY-2022 AISC decreased from $1,026/oz in FY-2021 to approximately $994/oz in FY-2022 primarily due to an increased proportion of underground mining, and the cessation of open pit mining in the higher cost Wona open pit during the year.
2023 Outlook
- Mana is expected to produce between 190-210koz in FY-2023 at an AISC of $950-1,050/oz.
- In FY-2023, ore will be primarily sourced from the Siou and Wona underground where stope mining is expected to continue throughout the year, supplemented by ore from the Maoula open pit. Processed grades are expected to increase compared to the prior year as higher grade underground ore is expected to represent a larger portion of the mill feed. Production is expected to be weighted to H2-2023 as more stopes are expected to be accessible at the Siou underground mine following the development conducted in H1-2023. The underground development at the Wona underground deposit is expected to continue throughout the year while development of an additional portal is expected to commence in H1-2023.
- Sustaining capital expenditure is expected to increase from $9.9 million in FY-2022 to approximately $25.0 million in FY-2023, with expenditure relating mainly to capitalised underground development and plant maintenance.
- Non-sustaining capital expenditure is expected to decrease from $61.4 million in FY-2022 to approximately $45.0 million in FY- 2023, with expenditure relating mainly to Wona underground development, and its associated infrastructure, and the stage 5 lift of the TSF.
Sabodala-Massawa Mine, Senegal
Table 15: Sabodala-Massawa Performance Indicators1
| For The Period Ended | Q4-2022 | Q3-2022 | Q4-2021 | FY-2022 | FY-20212 |
|---|---|---|---|---|---|
| Tonnes ore mined, kt Total tonnes mined, kt Strip ratio (incl. waste cap) Tonnes milled, kt Grade, g/t Recovery rate, % PRODUCTION, KOZ | 1,727 | 1,297 1,719 11,761 12,789 8.07 6.44 1,034 1,081 2.84 3.41 88 90 86 105 | 6,449 | 6,603 40,933 5.20 3,777 3.19 90 345 | |
| 12,620 | 49,234 | ||||
| 6.31 | 6.63 | ||||
| 1,154 | 4,289 | ||||
| 3.16 | 2.88 | ||||
| 88 | 89 | ||||
| 103 | 358 | ||||
| Total cash cost/oz AISC/OZ | ~559 | 665 458 779 591 | ~577 | 507 645 | |
| ~661 | ~691 |
2For the post acquisition period commencing 10 February 2021. .
- Production increased due to an increase in processed grade and plant throughput while plant recovery rates remained stable.
- Total tonnes mined increased with a ramp up of mining activities at the Bambaraya pit and increased ore mining at the Massawa North Zone pits, in addition to the ongoing mining activity at the Sabodala and Massawa Central Zone pits.
- Tonnes milled increased as the feed blend contained a higher proportion of softer oxide material from the Bambaraya pit while the previous quarter was impacted by the rainy season and downtime associated with scheduled plant maintenance.
- Average processed grade significantly increased due to the increased contribution of higher grade ore from the Massawa Central Zone and Massawa North Zone pits.
- AISC decreased largely due to higher production driven by the higher grade ore from Massawa and lower processing unit costs driven by lower maintenance costs, while mining unit rates remained consistent.
- FY-2022 production totalled 358koz, achieving near the bottom end of the guided 360-375koz range due to delays at the end of the year in accessing high grade ore areas and greater volumes of waste extraction in the Massawa North Zone pits than initially scheduled. FY-2022 AISC amounted to approximately $691/oz, within the guided $675-$725/oz range.
- FY-2022 consolidated production increased from 345koz in FY-2021 to 358koz in FY-2022 due to the full year of production following the Teranga acquisition in Q1-2021. FY-2022 AISC increased from $645/oz to approximately $691/oz due to the lower average grade processed and increases in fuel and explosive costs, which were partially offset by foreign exchange benefits and lower sustaining capital.
2023 Outlook
- Sabodala-Massawa is expected to produce between 315-340koz in FY-2023 at an AISC of $760-810/oz.
- In FY-2023 ore will be primarily sourced from the Sabodala and Bambaraya pits with additional higher grade non-refractory ore expected to be sourced from the Massawa Central Zone and Massawa North Zone pits. Tonnes milled and recoveries are expected to be consistent with FY-2022 performance, while grades are expected to be slightly lower as FY-2022 benefitted from higher grade ore from the Sofia Main pit.
- Sustaining capital expenditure is expected to increase from approximately $40.0 million in FY-2022 to $45.0 million in FY-2023, primarily related to capitalised waste as well as fleet re-builds and additional mining equipment purchases.
- Non-sustaining capital expenditure is expected to decrease from approximately $40.1 million in FY-2022 to $35.0 million in FY- 2023 and is primarily related to waste capital stripping, infrastructure related to the Massawa mining areas and community resettlement.
- Growth capital expenditure is expected to be $170 million, with further detail on the growth capital spend for the project provided below.
Plant Expansion
- Construction of the Sabodala-Massawa expansion project was launched in April 2022 and remains on budget and on schedule for completion in H1-2024.
- Growth capital expenditure for the expansion project is approximately $290 million, of which $68.1 million was incurred in FY- 2022 and approximately $170 million is expected to be incurred in FY-2023 mainly related to process plant and power plant construction activities as well as the TSF-1B construction. Approximately $155 million or 53% of the total growth capital has now been committed, with pricing inline with expectations, mainly related to detailed engineering and design, earthworks, civil works, processing plant construction and long lead items including the mills.
- The construction progress regarding critical path items is detailed below:
- Bulk earthworks are largely complete with the primary crushing pad and surrounding construction completed.
- Civil works have continued to progress well with the concrete pour complete for the BIOX reactors and the crusher and reclaim areas. Civil works at the neutralisation area commenced in late November.
- Processing plant construction is underway, with three BIOX reactors currently being installed.
- Procurement for the 18MW powerplant expansion is completed and expansion work has commenced.