TSX posts gain, Jan. 31-Feb. 7: Aura Minerals, Caledonia Mining, Cameco, Semafo, Kirkland Lake

The S&P/TSX Composite Index rose 1.95% to 17,655.50. The S&P/TSX Global Mining Index fell 0.67%% to 78.49 and the S&P/TSX Global Base Metals Index rose 3.35% to 98.30. Spot gold fell US$18.50 per oz. or 1.17% to finish at US$1,570.00 per oz., and the S&P/TSX Global Gold Index lost 3.37% to finish at 257.62.

Aura Minerals surged $20.34 to $46.85 per share on media reports that it is planning on a dual listing in Brazil. The news reports prompted the company to issue a news release on Feb. 6 stating that it is “always evaluating alternatives with the aim of creating value for its shareholders” but said “no determination to pursue any particular course of action has been made at this time.” Aura is a mid-tier gold and copper company focused on the development and operation of gold and base metal projects in the Americas.

Shares of Caledonia Mining jumped 88¢ to $14.68. The company forecast adjusted earnings per share in 2019 will be in the range of US$1.55 to US$1.75 per share compared to its earlier guidance of US86¢ to US$1.17 per share. The stronger earnings were due to higher annual gold production, lower than expected operating costs and a strong gold price. Production last year came in at about 55,182 oz. gold, ahead of revised production guidance of 50,000 to 53,000 ounces. It expects production in 2020 will be between 53,000 and 56,000 ounces. The company increased its ownership in the Blanket mine in Zimbabwe to 64% on Jan. 21.

Cameco rose 75¢ to $11.42 per share. The company reported that it generated $527 million in cash from operations in 2019, down from $668 million in 2018. It posted adjusted net earnings of $41 million or 10¢ per share, down from $211 million or 53¢ per share in 2018. Cameco is starting 2020 with $1.1 billion in cash and $1 billion in long-term debt with maturities in 2022, 2024, and 2042. The company also said it has added just over 36 million pounds of uranium deliveries to its long-term contract portfolio, more than replacing what it delivered in 2019.

Semafo increased 33¢ to $3.12. The company announced it has re-started the processing plant at its Boungou mine in Burkina Faso. The mine was suspended last year after an attack against its workers left 39 dead and 60 wounded. Semafo said it expects initial three-month production from stockpiles of between 42,000 and 46,000 oz. gold at AISCs of US$530 and US$560 per ounce. It plans to resume mining in the fourth quarter. The stockpile contains 1.1 million tonnes grading 3.4 grams gold per tonne representing about 10 months of mill feed.

Shares of Kirkland Lake Gold fell $7.13 to $47.14. The company completed its acquisition of Detour Gold on Jan. 31. The company issued 77.22 million common shares to former Detour Gold shareholders as consideration for their Detour shares and now existing Kirkland Lake Gold and Detour Gold shareholders own about 73% and 27% of Kirkland’s shares.


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