KEY POINTS
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Blanket mine produced 17,030 ounces of gold in the third quarter, below last year’s output.
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Caledonia lowered its 2026 production forecast to 69,000–72,500 ounces.
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The company is targeting first gold at its Bilboes project in late 2028.
Caledonia Mining Corporation expects production at its Blanket gold mine in Zimbabwe to improve in the fourth quarter of 2026, following a weaker-than-expected performance in the previous quarter.
Chief executive officer Mark Learmonth said the company had identified the operational challenges responsible for the production shortfall and introduced measures to address them.
The interventions include increasing compressed-air capacity at deeper mining levels and expanding processing capacity to recover gold temporarily held in the plant.
Learmonth said the measures were expected to support higher production in the final quarter and improve operational consistency in 2027.
However, the company has revised its 2026 production guidance to between 69,000 and 72,500 ounces of gold.
Third-Quarter Production Falls
Blanket mine produced 17,030 ounces of gold in the third quarter ended September 30, compared with 19,106 ounces recorded in the corresponding period of 2025.
Gold sales also declined to 18,713 ounces from 20,355 ounces a year earlier.
Despite the lower output, Caledonia’s revenue increased by 10.5% year-on-year to $78.9-million, supported by a higher average realised gold price of $4,134 an ounce, compared with $3,434 an ounce in the third quarter of 2025.
Gross profit rose by 13.6% to $41.9-million, reflecting improved margins from the higher gold price.
However, net profit fell by 39.3% to $11.3-million, largely because of a non-cash fair value loss of $12.9-million on derivative financial instruments linked to the company’s convertible senior notes and gold price hedge options.
The board also approved a quarterly dividend of $0.14 a share.
Bilboes Project Remains Growth Priority
Learmonth said the company was maintaining progress on its wider growth strategy, with the Bilboes gold project remaining its immediate priority.
Caledonia is targeting first gold production at Bilboes in the fourth quarter of 2028. The company has also signed an interim facilities agreement that allows it to borrow up to $150-million to support the project.
At Blanket, the company has secured an environmental-impact assessment certificate for large-scale oxide mining and heap leach operations. The project could begin in early 2027, subject to the outcome of an ongoing heap leach trial.
Modifications to increase the mine’s metallurgical processing capacity are expected to be completed by mid-2027. In the meantime, some additional ore from Blanket is expected to be processed at the refurbished Lima plant.
Caledonia is also continuing exploration at Motapa, where it has declared an initial mineral resource, which the company considers an important step towards assessing the project’s potential.
