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(Sharecast News) - Caledonia Mining Corporation reported a decline in first-quarter gold production at its Blanket Mine on Monday, citing expected lower grades and operational challenges, but maintained its full-year output guidance.
The AIM-traded company said gold production for the three months to 31 March fell to 14,767 ounces, compared with 18,671 ounces in the same period a year earlier.
It said the weaker performance had been anticipated, reflecting mining sequence and limited access to higher-grade, higher-volume areas, alongside equipment availability issues and challenging ground conditions.
"Gold production in the first quarter of 2026 was below our expectations, reflecting the lower grades mined during the quarter; however, this is consistent with our guidance of production being weighted towards the second half of the year," said chief executive Mark Learmonth.
"Pleasingly, plant performance remained strong, with 202,217 tonnes milled and good operational availability across the processing circuit.
"This is an important reflection of our continued investment into the future of the processing facility."
Learmonth added that the quarter was affected by "several typical operating challenges associated with deep, mature mining assets, including sequencing considerations, equipment downtime and difficult ground conditions in certain areas," which constrained access to planned ore sources.
The group said it was implementing a series of measures to improve performance, including appointing a contractor to accelerate access to higher-grade ore and introducing a new shift system that will increase operations from six to seven days per week.
It was also expanding processing capacity through the commissioning of an additional ball mill in the second quarter.
"We are actively addressing these challenges through several practical measures, including the acceleration of mine development, supported by the appointment of a contractor, to improve access to planned ore sources," Learmonth said.
"Importantly, we will be introducing a revised shift system later in the year, moving the operation to a seven-day working week - up from six - which we expect will both reduce worker fatigue and support increased ore production."
Caledonia said it remained comfortable with its full-year production guidance of 72,000 to 76,500 ounces, with output expected to be weighted towards the second half as the operational improvements took effect.
At 0911 BST, shares in Caledonia Mining Corporation were down 0.34% at 1,928.4p.
Reporting by Josh White for Sharecast.com.
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