B2Gold beats output, cost expectations

B2Gold (TSX: BTO, NYSE-A: BTG) says it surpassed expectations in key operating and financial metrics during this year’s first quarter, driven by improved performance across its four producing gold mines. The shares jumped.  

The gold miner produced 237,763 oz. during over the three months, B2Gold said on Thursday. The company’s primary mine, Fekola in Mali, alone accounted for 117,450 oz., which was higher than anticipated and represents a 25% increase over the 93,805 oz. from the year-ago period.

The Goose mine in Canada, which entered commercial production in October, contributed a higher-than-expected 42,876 ounces. The Masbate mine in the Philippines and Otjikoto in Namibia made up the rest of production, with both exceeding company expectations as well.

“It is a standout quarter,” Haywood Securities mining analyst Jamie Spratt said in a note on Thursday. “But we believe critical operational milestones for the company remain the ramp up of crushing and full run rate production at Goose and the receipt of regional exploitation permits at Fekola. Success on these fronts would sustainably eliminate the significant discount to global producer peers.” 

Shares in B2Gold jumped 11% to close at $6.76 apiece in Toronto, valuing the company at $9 billion (US$6.59 billion). They’ve traded in a 52-week range of $4 to $8.60.

Fekola

At Fekola, the increased production was the result of higher throughput, with 2.55 million tonnes at average gold grade of 1.56 grams per tonne and a gold recovery of 91.7%, B2Gold said. Meanwhile, the Goose mine benefited from higher grade and recovery, offsetting a drop in throughput. The other two mines also had higher ore grades.

The company’s results were driven by Fekola first-quarter production was higher than the 210,000 oz. projected by analysts at Haywood, Spratt said. 

With these results, B2Gold said it expects consolidated gold production for 2026 to be between 820,000-970,000 oz., including a guided 410,000-460,000 oz. from Fekola, 170,000-230,000 oz. from Goose, 170,000-190,000 oz. from Masbate and 70,000-90,000 oz. from Otjikoto.

The company highlighted that its operations continue to maintain normal levels of fuel supplies despite global challenges, and at Fekola, it is working to expand its diesel storage capabilities by approximately 20%. It also noted that the solar projects at the Fekola, Masbate and Otjikoto mines are expected to provide a source of power that is not impacted by changes in fuel prices.

Earnings win

On the financial side, the Toronto-based gold miner reported a net income of US$205.5 million, or US15¢ per share. Adjusted earnings came to US$260 million or US19¢ per share, beating the consensus estimate of US11¢ and Haywood’s US18¢ per share.

The earnings were boosted by an increase in gold sales that led to a year-on-year doubling of revenue to above US$1.1 billion, as well as lower-than-expected cash operating costs of US$1,005 per ounce of gold produced.

At the end of the quarter, B2Gold had free cash flow of US$362 million, compared to a negative cash balance of US$7 million the same time last year.