TIDMHUM
RNS Number : 6442W
Hummingbird Resources PLC
19 April 2023
Hummingbird Resources plc / Ticker: HUM / Index: AIM / Sector:
Mining
19 April 2023
Hummingbird Resources pl c
("Hummingbird" or the "Company")
Q1 2023 Operational and Trading Update
Consecutive strong quarterly production of +27koz & improved
AISC profile of US$1,109 per oz
Hummingbird Resources plc ("Hummingbird" or the "Company") (AIM:
HUM) is pleased to announce an operational and trading update for
the first quarter of 2023 ("Q1 2023").
Operational update
Yanfolila, Mali
-- Quarterly gold production for Q1 2023 of 27,262 ounces ("oz")
(Q4 2022 of 28,264 oz, and Q1 2022 of 15,548 oz).
-- AISC of US$1,109 per oz for Q1 2023 (a +11% improvement from
Q4 2022 of $1,248 per oz and +50% from Q1 2022 of US$2,235 per
oz).
-- 26,380 oz of gold sold in Q1 2023 at an average realised
price of US$1,878 per oz (Q4 2022: 27,860 oz of gold sold at an
average realised price of US$1,726 per oz). The Company held 2,810
oz of gold inventory on 31 March 2023, valued at c.US$5.6
million.
Kouroussa, Guinea
-- Kouroussa construction is fully funded, on budget and remains
on track for first gold pour by the end of this quarter, Q2
2023.
-- >2.5 million lost time injury ("LTI") free hours now
achieved, a key ongoing safety metric for the Kouroussa
construction team, with over 1,000 construction and mining
personnel on site currently.
Dugbe, Liberia
-- The strategic review of options to best realise the maximum
value of Dugbe for all stakeholders is ongoing with our joint
venture partner, Pasofino Gold Limited ("Pasofino").
Corporate
-- Strategic investment by CIG SA ("CIG") and successful
placement ("the Placement") of c.US$17.1 million during Q1 2023,
completing the funding required to ensure Kouroussa goes into
production as scheduled, and to fast-track exploration at that
asset.
-- Consecutive strong and improved quarterly Group EBITDA, up
+59% to c.US$17.5 million for Q1 2023, versus Q4 2022 of c.US$11
million.
Outlook
-- Similar trends from Q1 2023 levels expected this quarter, Q2 2023.
-- As previously stated, an updated Group wide full year
guidance update to be provided once Kouroussa is in production and
ramping up.
Dan Betts, CEO of Hummingbird, commented:
"Hummingbird's second mine, Kouroussa, remains on track to pour
first gold this quarter. The Project remains on time and on budget,
and will mark a major milestone in the development of the Company
to realising our ambitions of being a multi-mine,
multi-jurisdiction gold producer. The mine will more than double
our production profile, reduce the Group's cost of production, and
diversify risk. The achievement of over 2.5 million LTI free hours
at the Project is also a fantastic accomplishment by the team, for
which we are proud of.
At Yanfolila, we continue to see operational improvements which
is very positive, with a mine adding good cash flow returns to the
business and performing more in line with expectations. Yanfolila
had a positive quarter in terms of production and improved AISC
profile, with many of the operational changes made in H2 2022
coming through to the bottom line in terms of a more stabilised and
predictable performance at the mine.
The quarter also saw the Company take on a strategic investment
from CIG. This investment has helped ensure that we can deliver
Kouroussa without the risk of delay; but possibly more importantly,
it gives us a strategic partner with whom we share a long-term
ambition of continuing to grow Hummingbird into a multi-mine,
multi-jurisdiction gold Company."
Operational Update
Note: Ore mined includes high grade, low grade, and marginal
material. Ore processed is a blend based on preferential feed of
high grade and low grade , with marginal ore added as an
incremental feed source.
Yanfolila, Mali
-- Q1 2023 saw production of 27,262 oz, being another
consecutive strong production quarter for the Company, following Q4
2022 gold production of 28,264 oz.
o Similar trends are expected in Q2 2023, with mining continuing
primarily in the high-grade Komana East ("KE") deposit.
o KE deposit will be largely mined by early Q3 2023, with the
mine plan increasingly shifting to other open pit deposits,
including Sanioumale East ("SE") which is currently being prepared
for mining in H2 2023.
o Further, initial development of the Komana East underground
mine ("KEUG") began in Q1 2023, with first underground production
scheduled by year end, for a full underground production year in
2024, with more details below.
-- Ore processed totalled 366,622 tonnes ("t"), showing another
good consecutive quarterly result, as the key target mine area for
the quarter, being KE, was mined.
-- Mill feed grade for Q1 2023 averaged 2.41 grammes per tonne
("g/t"), in line with the mill feed grade as seen in Q4 2022 of
2.45 g/t.
-- Processing plant recovery rates for Q1 2023 were 94.41%, in
line with the Company's historical average, and as seen in Q4
2022.
-- KEUG initial development work began in Q1 2023, with portal
hole access works started, design works completed and key
underground mining equipment from international underground mining
specialists Epiroc beginning to arrive on site. A more detailed
update will be given in our Q2 2023 operational update on the KEUG
mining progress and economics. With a +278,000 oz Reserve, at 3.94
g/t, and increased mine life potential with further drilling, the
KEUG will be a key deposit to underpin Yanfolila's future
production profile.
-- The contract with Yanfolila's contract miner JCM was
terminated on 31 March 2023 as a result of ongoing poor equipment
availability which materially impacted the operational performance
of Yanfolila. The Company is currently supporting a transition of
mining activities to a new contractor, with the ongoing support
from Corica Mining Services (West African contract mining
specialist, and Kouroussa's contract miner), including the
excavators Corica have supplied for continued mining at Yanfolila
without disruption.
-- As noted in our Q4 2022 Operational and Trading update, a
detailed cost control and reduction programme at Yanfolila was
initiated and remains ongoing with cost improvements starting to
come through at site.
-- Maintaining FY2023 production guidance for Yanfolila, Mali,
of 80,000 - 90,000 oz, with a full year AISC of under US$1,500 per
oz, with an updated Group wide full year guidance update to be
provided once Kouroussa is in production and ramping up.
-- Yanfolila ESG: SE village resettlement begun in Q1 2023 and
is progressing ahead of schedule for completion of new housing
being built for the community, in preparation for mining at the SE
deposit in H2 2023. Resettlement and new village houses are being
built for the community village under the guidance of West African
specialist consultants ESDCO (Environmental and Social Development
Company).
Kouroussa, Guinea
-- As noted in the highlights above, Kouroussa construction is
fully funded, on budget and remains on track for first gold pour by
the end of this quarter, Q2 2023.
-- Final construction, operational readiness and commissioning
programmes are being completed in preparation for first gold
pour.
-- Mining commenced early in the quarter, with ore stockpiles
increasing on the ROM pad in preparation for commissioning and ramp
up to name plate capacity in H2 2023.
Other key operational readiness and construction updates that
occurred for the quarter include:
-- >2.5 LTI free hours now achieved, a key ongoing safety
metric for the Kouroussa construction team, with over 1,000
construction and mining personnel on site currently.
-- Tailings storage facility construction completed, with piping
infrastructure to the processing plant being installed.
-- Power plant equipment arriving on site and being installed in
preparation for commissioning.
-- Permanent mine camp construction scheduled to be completed end of April 2023.
-- Detailed commissioning schedule developed by site and Soutex
(Kouroussa's engineering contractor), with commissioning personnel
identified and being hired, including those that commissioned
Yanfolila in Mali.
-- Processing plant labour requirements for commissioning, ramp
up and full production are in place, with a key focus on hiring
more personnel to fill supporting and managerial roles, with the
emphasis on national and local hires where possible.
-- Increasing key focus on building overall inventory supplies
required for mining and production being implemented.
-- Detailed Kouroussa exploration plans are being developed in
H1 2023 with a view to re-initiated exploration drilling plans in
H2 2023 / 2024, with the focus to increase on Kouroussa's current
Reserves base of 647,000 oz at 4.15 grammes a tonne ("g/t").
Kouroussa ESG:
-- Increasing healthcare and first aid training initiatives
being conducted in the communities and schools at Kouroussa from
our on-site clinical nursing team and global remote healthcare
specialists Critical Care International ("CCI").
-- Community livelihood initiatives and projects advanced during
the quarter, in particular the construction of community market
garden infrastructure and community water bore holes.
Financial update
-- Q1 2023 AISC at US$1,109 per oz, a +11% improvement to Q4
2022 AISC of US$1,248 per oz, and below our full year AISC guidance
of less than US$1,500 per oz for Yanfolila, being a key highlight
of the quarter, largely driven by: lower strip ratios; improved
mining techniques being installed at site; cost control; and good
grades being mined from the KE open pit.
-- Another consecutive strong and improved quarterly Group
EBITDA of c.US$17.5 million for Q1 2023. Strong production and a
reduced AISC profile, coupled with improved gold price received for
gold ounces sold, leading to a +59% improvement from the Q4 2022
Group EBITDA of c.US$11 million, also another key highlight from
the quarter.
-- Capital expenditure of approximately c.US$21m in the quarter,
primarily at Kouroussa, funded from both operating cashflows and
the Placement of c.US$17 million during the quarter.
-- Net debt position c.US$110.8 million end of Q1 2023
(c.US$105.2 million including gold inventory value) consisting
of:
o Gross debt of c.US$118.7 million.
o Cash at bank of c.US$7.9 million.
o Gold inventory value of c.US$5.6 million.
-- Further, c.US$15 million remains available and expected to be
drawn this quarter, Q2 2023, from the Coris Bank International
("Coris Bank") debt facilities.
-- Of the budgeted US$115 million capex for the construction of Kouroussa:
o c.US$83 million has been paid as at the end of Q1 2023.
o c.US$12 million to be paid this quarter and early Q3 2023.
o c.US$20 million contractor deferrals, retention incentives and
working capital not expected to be paid until Kouroussa is in full
production.
-- The balance of Kouroussa's capex to be funded from a
combination of the recent Placement, ongoing operational cashflows
and available debt facilities.
**ENDS**
Notes to Editors:
Hummingbird Resources plc (AIM: HUM) is a leading multi-asset,
multi-jurisdiction gold production, development and exploration
Company, member of the World Gold Council and founding member of
Single Mine Origin (www.singlemineorigin.com). The Company
currently has two core gold projects, the operational Yanfolila
Gold Mine in Mali, and the Kouroussa Gold Mine in Guinea, which
will more than double current gold production when in production,
scheduled for first gold pour the end of Q2 2023. Further, the
Company has a controlling interest in the Dugbe Gold Project in
Liberia that is being developed by Pasofino Gold Limited through an
earn-in agreement. The final feasibility results on Dugbe showcase
2.76Moz in Reserves and strong economics such as a 3.5-year capex
payback period once in production, and a 14-year life of mine at a
low AISC profile. Our vision is to continue to grow our asset base,
producing profitable ounces, while central to all we do being our
Environmental, Social & Governance ("ESG") policies and
practices.
For further information, please visit hummingbirdresources.co.uk or contact:
Daniel Betts, Hummingbird Resources Tel: +44 (0) 20 7409
CEO plc 6660
Thomas Hill,
FD
Edward Montgomery,
CD
James Spinney Strand Hanson Limited Tel: +44 (0) 20 7409
Ritchie Balmer Nominated Adviser 3494
-------------------------- ----------------------------
James Asensio Canaccord Genuity Limited Tel: +44 (0) 20 7523
Gordon Hamilton Broker 8000
-------------------------- ----------------------------
Bobby Morse Buchanan Tel: +44 (0) 20 7466
Oonagh Reidy Financial PR/IR 5000
Email: HUM@buchanan.uk.com
-------------------------- ----------------------------
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