Caledonia profit rises 27% as it lines up $150m interim loan for Bilboes

Caledonia Mining Corporation reported a 27% rise in second-quarter profit after tax to $30.0 million on 10 August, as a much higher gold price more than offset lower production and sharply higher unit costs at its Blanket mine in Zimbabwe.

Revenue rose 16% to $75.9 million from $65.3 million a year earlier. The average realised price was $4,259 an ounce, 34% above the comparable quarter but 12% below the first quarter of 2026. Earnings per share came in at $1.36 and EBITDA at $45.8 million. Net cash stood at $167.8 million, compared with $8.2 million a year earlier.

Costs move higher

Blanket produced 17,360 ounces, 18% less than in the second quarter of 2025 but 18% more than in the first quarter. On-mine costs rose 49% year on year to $1,675 an ounce and all-in sustaining costs increased 48% to $2,678 an ounce, although AISC was 3% lower than in the first quarter. Caledonia reaffirmed production guidance of 72,000 to 76,500 ounces but raised its cost guidance to $1,600 to $1,800 an ounce for on-mine costs and $2,500 to $2,700 for AISC.

Chief executive Mark Learmonth called the quarter a significant improvement in operating performance and said the company expects production to strengthen further in the second half.

Bilboes funding takes shape

The more consequential news concerned Bilboes, the large open-pit project that Caledonia expects to become Zimbabwe's biggest gold mine. The company has already raised convertible notes in January and is now assembling bank debt in two layers. An interim facility of $150 million is being arranged with Zimbabwean banks, and Caledonia said it had received credit approvals for more than half of it. A larger project finance facility of $300 million is at the due-diligence stage with lenders.

Caledonia said first construction work on site is planned for October 2026. Because much of the Bilboes spending will now fall in early 2027 rather than this year, the company cut its 2026 capital expenditure guidance to about $103 million. First gold remains targeted for late 2028, with the first full year of production in 2029.

The board declared a quarterly dividend of 14 US cents a share, payable on 4 September. Caledonia also scheduled a capital markets day in New York for 16 September.

The results show a company managing two pressures at once: cost inflation at an established underground mine and the need to finance a project several times its current size. Record-level gold prices are giving it the balance sheet to do both, but the rising cost base at Blanket means the margin cushion is thinner than headline profit growth suggests.

Sources

• Stock Titan (company release): Caledonia Mining Corporation PLC: Results for the Quarter and Half Year Ended June 30, 2026, 10 Aug 2026

Photo: Gold ingots stacked on a white background. Szaaman, Wikimedia Commons, Public domain.