B2Gold cuts dividend to invest in growth plans

B2Gold Corp, a Canadian mining company, announced its production forecast for 2024, aligning with the lower end of its revised guidance at 804,778 gold ounces. Despite some setbacks, B2Gold remains optimistic for 2025, predicting a significant increase in production to between 970,000 and 1.06 million ounces. This anticipated growth will stem from new projects like the Fekola Phase 7 and Cardinal Pits, as well as the commencement of production at the Goose project in Nunavut. However, challenges persist in Mali, including political instability and disruptions that affected production. Nonetheless, a newly signed agreement with the Malian government offers a degree of operational security moving forward. The Fekola mine, although it produced 392,946 ounces in 2024—below guidance—has shown potential for recovery with improved equipment availability and access to higher-grade ore. Meanwhile, the Goose project is set to initiate gold production in the second quarter of 2025, targeting an output of 120,000 to 150,000 ounces annually from 2025 to 2031. In Namibia, the Otjikoto mine exceeded expectations in 2024, producing 198,142 ounces, but is transitioning to a closure of its open-pit operations by 2025. This necessitates the feasibility study on the Antelope deposit to explore extending the mine's life. In Colombia, B2Gold’s Gramalote project progresses towards a feasibility study expected in mid-2025, showcasing promising production potential based on favorable economic assessments. To enhance these growth plans, B2Gold earmarked $61 million for exploration in 2025, emphasizing projects such as Back River. However, to finance these ambitious plans, the company announced a significant reduction of its quarterly dividend by 50%, lowering it to CA 2 cents per share. This decision reflects a strategic approach to maintain a robust financial position and ensure flexibility for future growth initiatives. B2Gold's CEO, Clive Johnson, acknowledged the importance of sustaining internal growth projects amid these changes while still aiming to offer competitive yields to shareholders. Overall, B2Gold’s future growth hinges on the successful development of its various projects and its ability to navigate ongoing operational challenges, especially within Mali. The investments made this year are expected to pave the way for a prosperous phase in the subsequent years while fulfilling expected production targets.