Ivanhoe Mines‘ President Marna Cloete and Chief Financial Officer David van Heerden are pleased to present the company’s financial results for the three and nine months ended September 30, 2023. Ivanhoe Mines is a leading Canadian mining company developing and operating its four principal mining and exploration projects in Southern Africa: expanding operations at the world-class Kamoa-Kakula Copper Complex (Kamoa-Kakula) in the Democratic Republic of Congo (DRC); building the tier-one Platreef palladium, nickel, platinum, rhodium, copper and gold development in South Africa; restarting the historic, ultra-high-grade Kipushi zinc-copper-lead-germanium mine in the DRC; as well as exploring the expansive exploration licences of Ivanhoe’s Western Foreland for copper discoveries adjacent to Kamoa-Kakula. All figures are in U.S. dollars unless otherwise stated.

Ivanhoe Founder and Executive Co-Chairman Robert Friedland commented:

“Kamoa-Kakula continues its industry-leading development and operating performance with copper production and costs remaining solidly within our annual guidance ranges… an increasing rarity in our business, where many of our peers are being plagued by cost over-runs and production shortfalls. With the Phase 3 concentrator expansion now well ahead of schedule, our teams are striving to further expedite copper production ramp-up into the second half of 2024, en route to becoming the world’s third-largest, lowest-carbon emitting copper complex by 2027.

“And this is only the beginning for a copper district with a multi-generational lifespan that will benefit the Congolese people, our partners, and our shareholders for many decades to come. We are particularly excited to provide, very soon, updates on our extensive exploration activities across Ivanhoe’s district-scale Western Foreland Exploration Project surrounding our 400-square-kilometre Kamoa-Kakula mining licenses. The Western Forelands, soon to be serviced by the new Lobito railway corridor, is without a doubt the best copper hunting ground on our planet. As we will soon demonstrate, there are vast opportunities to further expand high-grade, ultra-low-emissions copper production across this tier-one copper-mineralized basin, endowed with the world’s best copper deposits.

“Finally, our track record of operational excellence is continuing with the successful development of the Kipushi zinc-copper-silver mine, which is well ahead of schedule. Kipushi will also be powered by the Congo’s green hydropower grid. With the Platreef PGM-nickel-copper mine in South Africa also on track for production next year, Ivanhoe Mines has two additional world-class ore bodies spanning many critical strategic minerals, including zinc, platinum, palladium, nickel, rhodium, copper, and potentially gallium and germanium.”

The manufacturing industry, which makes up 48,6% of total exports, experienced a decrease in exports of N$894 million in September.

According to the Namibia Statistics Agency’s latest figures, the industry took the lead in exports, with goods valued at N$3,8 billion, despite the decrease of N$894 million, compared to the previous month.

This was followed by the mining and quarrying industry, which accounted for 44,3% of the export value in September.

Goods from this industry increased by N$1,3 billion compared to the previous month.

Statistician general Alex Shimuafeni says exports mainly comprised minerals such as precious stones.

“Namibia’s exports continued to show a positive trend, reaching N$74,9 billion for the first nine months of 2023, an increase from N$70 billion during the same period in 2022.

“Exports mainly consisted of diamonds, uranium, non-monetary gold, and petroleum oils,” he says.

Exports left Namibia primarily by air (34,9%), followed by sea (34,2%) and road (30,9 %).

In September 2023, exports increased by 5,3%, compared to August 2023.
However, when compared to September 2022, exports decreased by 11,2%.

Import trends

According to Shimuafeni, the manufacturing industry was the dominant sector, with an import bill of N$7,9 billion in September 2023 – a 10,7% decrease from the previous month.

“Namibia’s top five export markets in September 2023 accounted for 64,4% of total exports, with South Africa as the primary destination (20,6%), followed by Botswana (19,2%), China (9,8%), Zambia (8,1%), and the United Arab Emirates (6,7%),” he says.

Imports into Namibia were predominantly through road transportation (58,4%), followed by sea transport (38,6%) and air transport (2,9%).

Imports in September 2023 stood at N$11,1 billion, marking a 9,6% decrease compared to the previous month, and a 2,2% decrease year on year.

South Africa remained Namibia’s primary trading partner for both exports and imports.

Commodity of the month

The commodity of the month in September 2023 was fresh dates, with exports valued at N$2,6 million to South Africa and Bangladesh, averaging N$10,3 million monthly from September 2022 to September 2023.

“Namibia exported fresh dates worth N$2,6 million and imported the commodity at a mere N$31 038 during September 2023,” Shimuafeni says.

Namibia’s trade balance was at a deficit of N$3,3 billion, which is an improvement compared to the N$4,9 billion deficit in August 2023 and the N$2,6 billion deficit in September 2022.

The Southern African Customs Union was the largest export market for Namibia, contributing 39,8% to total exports in September 2023.

The Organisation for Economic Cooperation and Development came second with a market share of 25,2%.

Barrick’s Q3 results showed improved production at lower costs and confirmed its long term growth forecast. President and chief executive Mark Bristow said the Q3 performance was an improvement on the previous quarter’s and Q4 is expected to be better. Despite the projected second half improvement, gold production is forecast to be marginally below the low end of our annual guidance range. Copper is comfortably on track to meet its guidance for production and costs.

Gold production in Q3 was higher than Q2 driven by improved performances at Cortez, Turquoise Ridge and Kibali. As previously disclosed, the ramp up at Pueblo Viejo is slower than planned. Barrick is engaged with original equipment suppliers to develop permanent solutions for their equipment failures. The 2024 Pueblo Viejo production forecast still exceeds 800,000 ounces (100% basis). The company also confirmed that the Notice of Availability for the Final Environmental Impact Statement for Goldrush was published on October 27.

“Mining is a long game and we don’t manage Barrick by the quarter – our projection for a 30% increase in the production of gold-equivalent ounces by the end of this decade remains intact,” Bristow said.

Barrick’s other key growth projects – the development of the Reko Diq copper and gold mine in Pakistan, and the expansion of the Lumwana copper mine in Zambia – are making steady progress. Construction of Reko Diq is scheduled to start in 2025 targeting first production in 2028, and Lumwana’s expansion is scheduled on the same timetable. Reko Diq will rank among the world’s top 10 copper producers when it reaches full production, while the expanded Lumwana mine is forecast to produce at an annual production rate of 240,000 tonnes of contained copper.

“Growing the copper portfolio is one of our strategic priorities, and when these two mines are in full production, they will promote Barrick to the premier league of copper producers alongside its peerless gold portfolio. In the meantime, we’re using our very successful Jabal Sayid copper mine in Saudi Arabia as a springboard for the discovery of new opportunities within the Kingdom and around the Red Sea to Egypt, where we believe the Arabian-Nubian Shield is poised to become a major new mining destination,” Bristow said.

Barrick has aggressive exploration across its global portfolio, aiming both to sustain the company’s peerless record of reserves replacement, and to find its next million-ounce discovery. Since the merger with Randgold Resources in 2019, Barrick has replaced 125% of its depleted reserves (exclusive of divestments and acquisitions on a gold equivalent basis).

Strong drill results at Nevada Gold Mines support its three-year resource and replacement plan and, brownfields exploration is highlighting the potential in the Africa and Middle East region, and the exploration portfolios of South, Central and North America are being expanded.

Bristow described Barrick’s financial performance for the quarter as strong, noting that operating cash flows grew by 35% to more than US$1 billion, free cash flow3 was up significantly to US$359 million, net earnings per share increased 24% to US$0.21 per share and adjusted net earnings per share6 rose 26% to US$0.24 per share. The quarterly dividend was maintained at 10 cents per share.

“Our robust balance sheet secures Barrick’s capacity to continue to invest in growth projects, both new and existing. These projects are not required to maintain our existing production profile; they’re exceptional opportunities to drive real long-term value creation, and our team has shown that they’re more than capable of fully delivering on them,” Bristow said.

Shares in Base Resources tumbled nearly 18% after the company said exploration had failed to extend the resources of its Kwale mineral sands deposit in Kenya.

As a result mining would stop at the end of 2024, the company said. Shares in Base Resources last traded at 14 Australian cents apiece on the Australian Stock Exchange. The company has a market capitalisation of A$164.9 million.

Even after applying optimistic assumptions on the continuity of two mineralised zones at its Kwale East exploration site, Base concluded there was unlikely to be sufficient volume or heavy mineral grade to economically support mining.

Other factors behing the decision to cease mining in at Kwale is the cost and operating expense of extending the existing tailings facilities as well as human resettlement and a likely deterioration in mineral sands prices over the period of the development.

In addition to Kenya, Base Resources is also exploring in Tanzania and is waiting on Madagascar to resume discussions on the development of the Toliara mineral sands project. But both developments have run into roadblocks.

Base reported limited success at the Umba South in Tanzania. While the company confirmed mineralisation of rutile a number of factors were identified limiting the project’s economic potential”, it said in July. Further exploration was planned.

It also didn’t expect to register progress on the development of its Toliara project in Madagascar until the African island nation concluded elections as well as a review of its minerals code.

Toiliara is a potentially transformative project for the Australian-listed miner. A 2019 feasibility study said production could total 13 million tons (Mt) annually in a $442 million first phase. A $69 million second phase would increase output to 13Mt a year.

But finalisation of a mining licence was stalled after the Malagasy government decided to revamp tax regulations.

Swedish metal-cutting tools and mining equipment maker Sandvik has seen a smaller than expected rise in third-quarter core profit and a decline in order intake.

The company’s quarterly adjusted operating profit grew to 5.82 billion Swedish crowns ($527.81 million) from 5.52 billion a year earlier but lagged the mean forecast in an LSEG poll of analysts of 5.97 billion crowns.

Sandvik said it continued to see solid, broad-based demand in aerospace, with stable development in the automotive sector. However, the demand in general engineering was subdued, it said, pointing to a softer market and de-stocking dynamics.

“We have seen weakening market dynamics in some of our customer segments leading to lower volumes,” CEO Stefan Widing said in a statement.

Order intake for the quarter fell by 1% to 28.93 billion crowns from 29.23 billion a year ago, excluding acquisitions the orders declined by 7%, Sandvik said.

Jefferies said the quarterly order intake was a 5% miss compared to the consensus, noting that mining demand was normalising.

The CEO said in a call to journalists that the company had managed to offset rising inflation so far, but expected it to continue to be a challenge in the following year and also saw higher labour costs for 2024.

Zimbabwe ranks as the seventh-biggest diamond producer in the world with an annual output of over 4 million carats worth 420 million U.S. dollars, this was revealed in the latest production statistics released by the Kimberley Process Certification Scheme (KPCS).

In terms of diamond output, the Southern African country was only behind Botswana, Russia, Angola, Canada, South Africa and Namibia, according to the KPCS, a regulator of trade and production of diamonds globally.

Zimbabwe is aiming to produce 7 million carats of diamonds this year, and the sector is targeting an annual revenue of 1 billion U.S. dollars.

The Zimbabwean government expects the mining sector to reach a 12 billion U.S. dollar market value by the end of this year.