Banro narrows Q1 net loss as revenue rises 19%

VANCOUVER (miningweekly.com) – Canadian gold producer Banro has reported a smaller first-quarter net loss as financing expenses and fair value losses have offset higher output, sales and realised prices.

The result was despite a 19% increase in operating revenues to $55-million, and was boosted by 14% more ounces sold at 47 673 oz in the three-month period ended March, as the Namoya mine, in the Democratic Republic of Congo (DRC), ramped-up output, as well as a higher realised gold price.

The average gold price during the quarter was $1 158/oz, compared with $1 109/oz obtained during the comparable period of 2016.

The Toronto-headquartered company reported a net loss for the period of $15.87-million, or $0.05 a share, down from a net loss of $23.13-million, or $0.09 a share. Its performance was impacted by financing expenses of $12.1-million and noncash items totalling $2.4-million relating mainly to fair value losses on mark-to-market derivative liabilities, such as gold forward sale agreements and preferred shares, driven by improvements in the gold price environment.

Consolidated earnings before interest, taxes, depreciation, and amortisation for the first quarter came in at $13.92-million, up from $10-million a year earlier, reflecting higher gold sales at higher prices, and mainly offset by higher production costs from the increased mining activity.

The Namoya mine produced 23 100 oz of gold in the quarter at a cash cost of $735/oz, and the Twangiza mine produced 23 115 oz of gold at a cash cost of $816/oz. Banro owns four projects, each of which has a mining licence, and which are located along the 210-km-long Twangiza-Namoya gold belt, in the South Kivu and Maniema provinces of the DRC.

All-in sustaining costs for the first quarter were $933/oz, compared with $855/oz in the first quarter of 2016, driven by higher cash costs and higher levels of sustaining capital expenditure per ounce.

Banro expects to produce between 210 000 oz and 230 000 oz of gold in 2017.