B2Gold (TSX: BTO) reported second quarter gold revenue of $789.4 million, down sharply from $1.16 billion in the first quarter, as the miner sold fewer ounces at a materially lower average price.
Net income attributable to shareholders was $417 million, or $0.31 a share. A $292 million gain on the sale of the company’s 70% interest in Fingold to Agnico Eagle and $135 million in unrealized derivative gains did most of the lifting, offset in part by $71 million in realized losses on gold collar contracts that settle for the last time in January 2027. Adjusted net income, which strips those items out, was $41 million, or $0.03 a share, compared with $0.19 in the first quarter.
Operating cash flow before working capital changes was $94 million, but the quarter closed with a free cash outflow of $258 million. B2Gold attributed the swing to higher cash tax payments, including a larger priority dividend to the State of Mali, the final deliveries under its gold prepay contracts, and production costs that outpaced revenue.
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Cash and equivalents ended the period at $287 million, down from $479 million three months earlier, with working capital of $405 million. The $800 million revolving credit facility was fully undrawn at June 30, though $95 million has been drawn since. The company repurchased 19 million shares for $92 million during the quarter and declared a third quarter dividend of $0.02 a share, payable September 23.
Consolidated production totalled 203,648 ounces, down from 237,763 in the first quarter. Fekola contributed 116,281 ounces, Masbate 51,039 and Otjikoto 23,438, with the Goose mine in Nunavut adding 12,890 after an April 17 fire damaged part of its crushing circuit. Repairs are expected to be finished in the third quarter at a cost of about $13 million, alongside $16 million for a mobile crusher and $11 million in upgrades meant to lift throughput to 3,200 tonnes per day.
Costs moved up accordingly. Cash operating costs were $1,201 per ounce produced, total cash costs came in at $1,642 per ounce sold and all-in sustaining costs at $2,356 per ounce sold, against $1,005, $1,403 and $1,964 respectively in the first quarter.
The average realized price fell to $3,767 an ounce from $4,193, reflecting the prepay ounces delivered in the period.
“B2Gold delivered a solid second quarter, with production across our operating portfolio largely in line with expectations, highlighted by stronger-than-anticipated performance from Fekola, Masbate and Otjikoto,” said President and Chief Executive Officer Mike Cinnamond.
Full year production guidance was narrowed to 820,000 to 920,000 ounces from 820,000 to 970,000, the reduction coming entirely at Goose, now guided to 170,000 to 200,000 ounces. Masbate and Otjikoto were both raised by 10,000 ounces at each end of their ranges, and consolidated all-in sustaining cost guidance was cut to $2,370 to $2,550 per ounce sold.
B2Gold also said every step required to finalize the Menankoto exploitation permit has been completed, leaving the permit awaiting approval by Mali’s Council of Ministers, which the company expects in the near future.
B2Gold last traded at $6.50 on the TSX.
