TIDMHUM
RNS Number : 0131H
Hummingbird Resources PLC
25 July 2023
Hummingbird Resources plc / Ticker: HUM / Index: AIM / Sector:
Mining
25 July 2023
Hummingbird Resources pl c
("Hummingbird", the "Group", or the "Company")
Q2-2023 Operational and Trading Update
Strong quarter with H1-2023 production of >51 Koz &
Kouroussa ramping up to steady state production
Hummingbird (AIM: HUM) is pleased to provide a Group operational
and trading update for the second quarter of 2023, ending June 30
2023 ("Q2-2023").
Operational update
Yanfolila, Mali
-- 23,885 ounces ("oz") of gold produced in Q2-2023, an increase
of c.19% on the previous year (Q2-2022: 20,013 oz), with a total of
51,147 oz produced in the first half of 2023 ("H1-2023") up c.44%
versus H1-2022 (H1-2022: 35,561 oz).
-- AISC of US$1,234 per oz in Q2-2023, a decrease of c.34% on
the previous period last year (Q2-2022: US$1,859), with an H1-2023
AISC of US$1,170 per oz, a decrease of c.42% versus US$2,019 in
H1-2022.
-- 24,770 oz of gold sold at an average realised price of
US$1,981 per oz and $1,927 per oz for H1-2023 (H1-2022: US$1,819).
The Company held 1,831 oz of gold inventory on 30 June 2023.
Kouroussa, Guinea
-- Ramp-up of the Kouroussa operation is on track, with
processing plant availability currently at c.68%, the first gold
pour recorded on 8 June 2023 and regular gold pours commencing in
July.
-- Gold ounces poured at Kouroussa are scheduled to increase
during H2-2023. The operation is anticipated to reach steady state
production in Q4-2023 and expected to produce circa 30,000 oz for
H2-2023.
Corporate update
-- Group adjusted EBITDA of c.US$15.5 million for Q2-2023 and
c.US$33.1 million for H1-2023 - a material positive Group
turnaround compared to the negative Group adjusted EBITDA of US$2.3
million for Q2-2022 and the negative Group adjusted EBITDA of
US$9.3 million in H1-2022.
-- Group loss time injury frequency rate ("LTIFR") of 0.69 per
million hours worked for the quarter, within the Group target rate
of under 1.20 per million hours worked.
-- A strategic review of the Dugbe Project remains ongoing with
the Company's joint venture partner, Pasofino Gold Limited
("Pasofino").
Outlook
-- Following a strong H1-2023, Yanfolila is well positioned to
meet its FY-2023 production guidance of 80,000 - 90,000 oz at an
AISC of under US$1,500 per oz.
-- Updated Group FY-2023 production outlook to be given in the
Q3-2023 operating and trading update once Kouroussa is closer to
steady state production.
Dan Betts, CEO of Hummingbird, commented:
"This quarter has rounded off a six-month period that has seen a
strong performance by the Company as demonstrated by the more than
51 Koz of gold produced at an H1-2023 AISC profile of US$1,170 per
oz and Group adjusted EBITDA of c.US$33 million.
Yanfolila is performing more in alignment with our mine plans,
providing better consistency for the Group, and our first gold pour
at Kouroussa in June, currently in the ramp up production phase, is
a major milestone, making the Company a multi-asset,
multi-jurisdiction gold producer of which we are very proud.
As we look forward, our key focus for the coming months and the
second half of the year is to fully ramp up production safely at
Kouroussa to reach steady state production and to continue to
demonstrate stable quarterly production at Yanfolila, generating
solid free cashflows from both assets that strengthen our balance
sheet. Further, a core focus for the second half of 2023 is to
begin to implement our detailed exploration plans to extend the
life of mine at both Yanfolila and Kouroussa, coupled with a
positive solution on Dugbe in Liberia to benefit key stakeholders
at that asset."
Operational update
Unit Q2-2022 Q3-2022 Q4-2022 Q1-2023 Q2-2023 H1-2023
---------------------- ------ ---------- ---------- ---------- ---------- -------- ----------
Gold poured oz 20,013 16,827 28,264 27,262 23,885 51,147
====== ========== ========== ========== ========== ======== ==========
Mined BCMs BCMs 2,726,205 1,539,947 1,303,770 1,557,793 592,360 2,150,153
====== ========== ========== ========== ========== ======== ==========
Ore mined t 511,449 361,755 529,496 647,869 262,911 910,781
====== ========== ========== ========== ========== ======== ==========
Ore processed t 357,837 290,756 382,683 366,622 364,459 731,081
====== ========== ========== ========== ========== ======== ==========
Avg. grade mill feed g/t 1.87 1.90 2.45 2.41 2.21 2.31
====== ========== ========== ========== ========== ======== ==========
Recovery % 94.8% 92.8% 94.3% 94.4% 94.1% 94.2%
====== ========== ========== ========== ========== ======== ==========
Gold inventory
incl SMO oz 2,418 2,187 2,057 2,810 1,831 1,831
====== ========== ========== ========== ========== ======== ==========
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: Q2-2023 operational s ummary
-- As of the end of Q2-2023, the Yanfolila operation recorded a
rolling 12 month average LTIFR of 0.87 per million hours worked,
within the Company's LTIFR target of less than 1.20 per million
hours worked.
-- Gold produced totalled 23,885 oz in Q2-2023 and 51,147 oz in
H1-2023. As noted above, Yanfolila is well positioned to meet its
FY-2023 production guidance of 80,000 - 90,000 at AISC of less than
US$1,500 per oz, with the Company expecting a solid H2-2023
production profile from Yanfolila.
-- Mined BCMs reduced from Q1-2023 levels to 592,360 tonnes
("t"), driven by mining the bottom of the Komana East ("KE") open
pit. However, ore processed totalled 364,459 t, another good
consecutive quarter, with the Company utilising stockpile ore to
blend with the ore mined tonnes.
-- Q2-2023 saw another good quarter of average grade mill feed
at 2.21 grammes a tonne ("g/t") and processing plant recovery of
94.1%.
-- Mining at the KE open pit deposit was finalised in recent
weeks, with the last open pit blast taking place and the processing
of this ore to now occur in the current Q3-2023 quarter. The
finalisation of the KE open pit has allowed increased advancement
of the Komana East underground mine ("KEUG"), and progress is
expected to accelerate further in H2-2023.
-- Mining at the Sanioumale East ("SE") open pit deposit
commenced during Q2-2023, ahead of schedule, to allow increased ore
to the mill from the SE deposit to be processed in H2-2023,
alongside ore feed mix from other deposits including Sanioumale
West ("SW") and Komana West ("KW").
Yanfolila Resource extension drilling re-commenced during
Q2-2023:
-- During Q2-2023, drilling on brownfield deposits in the
Yanfolila license restarted, including SW and Gonka South ("GS").
The SW drilling will test for further mineralisation along the
north-east and south-west strike zones to extend the SW Resources.
The GS Resource upgrade drilling is complete and awaiting assay
results ahead of further analysis.
-- The Company expects H2-2023 exploration drilling at Yanfolila
to accelerate at near pit opportunities as well as some of the
historical Resources, with a key focus on increasing Yanfolila
Resources at known deposits and ultimately adding to the Yanfolila
Reserves base.
Yanfolila ESG:
-- SE village resettlement began in Q1-2023 and has been
completed ahead of schedule, allowing mining at the SE deposit to
begin during Q2-2023 as noted above. The SE resettlement has
resulted in the housing of over 40 families, all completed under
the guidance of West African specialist consultants Environmental
and Social Development Company ( " ESDCO").
-- Company supplied water infrastructure implementation and
support remain a key focus, with two deep water boreholes drilled
during the quarter, with water supply systems currently being
installed, to be completed in Q3-2023.
Kouroussa, Guinea: Q2-2023 operational s ummary
-- As of the end of Q2-2023, the Kouroussa operation recorded a
rolling 12 month LTIFR of 0.40 per million hours worked, within the
Company's LTIFR target rate of less than 1.20 million hours
worked.
-- Following the commencement of mining in early Q1-2023 and the
hot commissioning of the processing plant in Q2-2023, Kouroussa
achieved its first gold pour on 8 June 2023, ahead of the end of
the Q2-2023 schedule, and on budget . With regular gold pours
commencing in July, the ramp up of the Kouroussa operations is on
track towards steady state production, expected to occur in
Q4-2023.
-- The processing plant's availability has reached c.68%, with
the plant able to run as per design. A key focus area for the plant
team over the coming months will be to increase the running of the
plant at full availability on a 24-hour basis.
-- Mining operations commenced in early Q1-2023 and accelerated
during Q2-2023, with ROM stockpiles at the end of Q2-2023 of
approximately 120,000 tonnes of initial low grade material from the
mining of the top layer at the key KoeKoe open pit . The Company
expects the mill feed grade profile to incrementally improve during
H2-2023 as mining of the top layer at Koekoe is completed, allowing
access to deeper, higher-grade ore for mining and processing.
-- Other key areas of focus for the Kouroussa operations team to
safely reach steady state production during H2-2023 include:
o The management and monitoring of mining and other on-site
contractors to maximise the operational performance for the
Group.
o The implementation of wet weather procedures to protect access
to higher-grade ore for processing during H2-2023.
o Finalisation and efficient implementation of HR operational
plans.
o Efficient operation of the newly constructed mine camp,
allowing the company to end offsite residential requirements.
o Ongoing monitoring and following of safety protocols and
procedures.
Kouroussa exploration programme:
-- The Company is finalising exploration plans for H2-2023 and
FY-2024, with several targets identified within the current mining
license area for further drilling and analysis with the focus on
increasing Kouroussa's existing Reserves base of 647,000 oz at 4.15
g/t.
Kouroussa ESG:
-- Progress on community livelihood initiatives and projects
continued to advance. As part of Kouroussa's reforestation
strategy, 650 seedlings were planted during the quarter around the
mining camp area.
-- Additionally, the medical team conducted a malaria awareness
campaign during the quarter on site and in surrounding villages to
the mine.
Dugbe, Liberia
-- As noted above, the strategic review of options to best
realise the maximum value of Dugbe for all stakeholders remains
ongoing with our joint venture partner Pasofino.
Financial update
Unit Q2-2022 Q3-2022 Q4-2022 Q1-2023 Q2-2023 H1-2023
------------------ ------- -------- -------- -------- -------- -------- --------
Gold sales oz 20,490 16,917 27,860 26,380 24,770 51,149
================== ======= ======== ======== ======== ======== ======== ========
Avg. gold sale
price $/oz 1,851 1,713 1,726 1,878 1,981 1,927
======= ======== ======== ======== ======== ======== ========
Operating cash
costs $'000 38,253 36,179 34,581 28,996 29,996 58,992
======= ======== ======== ======== ======== ======== ========
AISC on gold
sold $/oz $,859 2,161 $1,248 1,109 1,234 1,170
======= ======== ======== ======== ======== ======== ========
Group Adjusted
EBITDA $m (2.3) (8.9) 11.2 17.6 15.5 33.1
======= ======== ======== ======== ======== ======== ========
Net (debt)
/ cash $'m (64.4) (84.7) (128.7) (110.8) (122.8) (122.8)
======= ======== ======== ======== ======== ======== ========
Net (debt)
/ cash inc gold
inventory value $'m (60.1) (81.0) (125.0) (105.2) (119.3) (119.3)
======= ======== ======== ======== ======== ======== ========
-- Q2-2023 AISC on gold sold from Yanfolila operations totalled
US$1,234 per oz, an 11% increase on Q1-2023, leading to an average
H1-2023 AISC of US$1,170 per oz. The Company expects H2-2023 AISC
to be higher than H1-2023 levels at Yanfolila, as more open pits
are mined, however FY-2023 AISC is to remain within guidance of
under US$1,500 per ounce.
-- Capital expenditure ("capex") of approximately c.US$16
million in the quarter (c.US$12 million for the project completion
at Kouroussa and c.US$4 million for expansion capex in Mali).
Expectations for H2-2023 Group capex to be materially lower versus
H1-2023 levels with the Kouroussa plant build complete.
-- Net debt position of c.US$122.8 million at the end of Q2-2023
(c.US$119.3 million including gold inventory value) with
deleveraging expected to commence in H2-2023. For the quarter
end:
-- Gross debt of c.US$128.6 million.
-- Cash at bank of c.US$5.8 million.
-- Gold inventory value of c.US$3.5 million.
**ENDS**
Notes to Editors:
Hummingbird Resources plc (AIM: HUM) is a leading multi-asset,
multi-jurisdiction gold producing 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 once at commercial production. Further, the Company
has a 51% controlling interest in the Dugbe Gold Project in Liberia
that is being developed by joint venture partners, Pasofino Gold
Limited. The final feasibility results on Dugbe demonstrate 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. The Company's vision is to continue to grow our asset
base, producing profitable ounces, while adhering to the highest
international standards of 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
George Pope Email: HUM@buchanan.uk.com
-------------------------- ----------------------------
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