Padenga sees strong jump in gold output

Padenga Holdings Limited says investments in its gold mining units Eureka and Pickstone Peerless drove strong gold production in the quarter to March 31, 2024, as well as positioning it for increased output in 2024.

In the quarter under review, the group’s gold sales jumped by 39 percent to 751,6kg, compared to 541,4kg in the prior year on the back of an increase in tonnes milled and mill feed grade.

The tonnes milled during the period increased by 7 percent to 457 440 tonnes, up from 427 702 tonnes recorded for the same period last year.

“The increase was due to optimised plant throughput at Eureka Mine as well as the addition of a new mill at Pickstone Peerless Mine. Mill feed grade also increased 2 percent to 1,47 g/t,” said the company in a trading update.

As the gold price outlook appears firm for the remainder of the year with record prices recorded to date, Padenga has embarked on further capital expenditure at Pickstone Peerless Mine for Phase 2 of the underground project in line with budget.

Other projects earmarked for 2024 include the Pre-Leach Thickener and solar plant at Eureka Mine.

The initial phase of the Pickstone Peerless Mine Underground (PLIG) project was officially commissioned by President Mnangagwa on April 10, 2024. Padenga said it remained on track to increase gold production while the company was still focused on initiatives to enhance grade, reduce operating costs, and improve recoveries.

However, the company said the expected increase in gold production and fulfillment of its crocodile skin contract volumes are set to enhance the group’s foreign currency earnings.

Regarding its Nile crocodile operations, the group said the expected improvement in skin contract volumes was due to an improvement in skin quality to optimal production levels last year.

“The business is on course to fulfil its 2024/25 skin contract volumes to its primary customer within FY2024 ahead of the contract end date of February 2025.

“Trading terms for the succeeding season are set to be negotiated in the third and fourth quarters, thus ensuring the viability of the business in the short to medium term.

“The exotic skins luxury market continues to withstand the turbulent global economic environment and maintains its position as a significant player in this value chain, thereby also expanding its customer base.”

Padenga said meat exports would resume later this financial year.

“The group’s management continues on its drive to reduce borrowings and related interest costs to sustainable levels and to improve profitability, thus generating shareholder value growth.”

For its crocodile business, the period under review saw Padenga Nile crocodile operations record a 34 percent decrease in skin harvest volumes to 9 248 skins versus 14 096 skins in the prior period.

“The first quarter of 2023 benefited from the harvest of some 10,000 skins carried over from December 2022. Skin sales in the first quarter of 7 480 skins were 213 percent above the 2 392 skins sold for the comparative period,” Padenga said.

“Sales in the quarter ensured the timely completion of the 2023/24 skin contract with the main customer and included an early contribution towards the 2024/25 skin contract ending February 28, 2025.”

The significant improvement in skin quality realised at the end of 2023 continued into the first quarter of 2024.-herald