# Caledonia Mining ‘Expect this to be an excellent year’ WH Ireland Analyst Comment

- Link: https://www.directorstalkinterviews.com/caledonia-mining-expect-this-to-be-an-excellent-year-analyst-comment/412813143
- Published: 2020-04-16T14:00:46+01:00
- Author: Giles Arbor

**Caledonia Mining plc** ([LON:CMCL](https://www.directorstalkinterviews.com/company/caledonia-mining-corporation/cmcl.l))
is the topic of conversation when DirectorsTalk caught up with WH Ireland Analyst
Paul Smith.

**Q. Caledonia Mining last week published an update on production from the Blanket
mine in Zimbabwe – what are the key points investors should note from this update?**

**A. **Caledonia’s production update showed that in our opinion the company has 
got its Blanket mine production under control.  A strong quarter in Q1 (19% up YOY)
and a comment form the CEO on more regular production quarters rather than production
building through the year.  This has been brought about by changing the mine planning
to incorporate a new development schedule to match production and the necessary 
development.

**Q. In your view what does the outlook look like for the company?**

**A.** Going forward I expect this to be an excellent year for Caledonia – Record
gold prices (highest since October 2012) and a strong price outlook should mean 
robust profits and importantly a cash increase for the company.  Especially important
when you consider this is the final high capital expenditure year as the commissioning
of the Central Shaft is completed and Caledonia can then begin the build up to its
promised >80koz gold per year production rate.

**Q. Will COVID-19 have a big impact on this year ?**

**A.** We are of the opinion that short-term the mine is insulated from wider country
lock-downs and Southern-African supply chain disruptions as it has an isolated work
force (who mostly live on site with their families – perhaps up to 95%) and after
years’ operating in Zimbabwe, the mine has weeks of stocks, supplies and spares.
In our view Caledonia Mining has a strong Balance sheet and can weather the COVID
storm better than many of its listed peers.

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