Mandalay Resources Corp's (TSE:MND) (OTCMKTS:MNDJF) saw a strengthening in its finances in the second quarter, as production at its Swedish mine, Björkdal saw notable operational optimization and improvement.
The company has producing mines at Björkdal, Sweden and in Costerfield, Australia.
“At Björkdal, US$19.1 million of revenue was generated, in line with the amount in the first quarter of 2019, and marks the second-highest revenue achieved during the past five quarters. Moreover, net income at Björkdal was the highest since the fourth quarter of 2017," said CEO Dominic Duffy in a statement. "This improved performance is due to the underground’s consistent delivery of tonnage to the mill and also the mining of higher-grade skarn material."
Duffy also noted that Mandalay expects to see further cost reductions over the remainder of 2019 "a result of the pause in open pit operations commencing from the end of July."
For the 2Q 2019, ended June 30, 2019, the firm generated revenue of US$26.3 million, adjusted EBITDA of US$4.1 million and an adjusted net loss before special items of US$3.9 million, or US$0.04 loss per share.
At its Costerfield mine in Australia, the firm noted it had maintained its operational focus on extending development to reach the higher-grade Youle lode, which is expected to increase the grade of material mined, and bring higher-grade ore online shortly.
“At Costerfield, gold equivalent production was lower than the previous quarter as the grade mined in the current quarter was lower due to additional dilution stemming from poor ground conditions in the Brunswick lode," said Duffy. "Measures are being put in place to minimize the amount of additional dilution to improve grade through the plant and to improve recoveries. We continue to expect an increase in production later in 2019 once we are mining the higher-grade Youle lode.”
The firm expects to reach the Youle lode at Costerfield in coming months.
Looking forward, the firm has a healthy cash balance and "financial flexibility to continue with the exciting exploration programs at each producing site, setting the company up for future profitability and growth," noted Duffy.
Shares of Mandalay were at C$1.30 on Wednesday in Toronto.
Contact Katie Lewis at [email protected]