[miningmx.com] — VILLAGE Main Reef has lost some momentum in the turnaround of the assets it bought from Simmer & Jack in 2011, with all its operations recording an output decline.
Reporting production figures for the December quarter on Monday, Buffelsfontein and Tau Lekoa posted decreases in output of 1% (13,774 oz) and 4% (29,843 oz) respectively.
Buffelsfontein’s performance was slightly better than earlier guidance of 13,503 oz, but Tau Lekoa fell 3% short of what management had promised to deliver.
“Gold production at Tau Lekoa was negatively impacted while new panels were established post the seismic activity experienced in August 2011,’ read a company statement. “Buffelsfontein performed consistently quarter on quarter.’
The worst performer in Village’s stable was Cons Murch, which it bought from Metorex, where the production of antimony fell 42% to 837 tonnes, with gold output also down 6% at 2,219 oz. Village did anticipate that the unprotected strike in September and October would’ve had a negative effect on output, but it turned out to be substantially worse than the original estimate, with antimony output 28% lower than guidance.
CEO Bernard Swanepoel was not immediately available to comment. In the company announcement, though, he said that notwithstanding the “somewhat lower production levels at the operations, Village is pleased that its operations are now achieving stable levels of output’.
“The higher average gold price achieved during this quarter will positively impact on earning and offset the impact of the lower production,’ he said.
These output figure came after a substantial improvement at Buffelsfontein and Tau Lekoa during the September quarter, where both mines recorded an 18% increase in production compared to July. The driving force behind September’s numbers was a jump in grade.
“I am reasonably confident that the overall level of gold production attained is achievable,” Swanepoel said at the time when questioned on the sustainability of the upswing.
In the latest announcement, Village said it would report its operational and financial details for the quarter towards the middle of February.
As for the proposed transaction to buy Blyvoor from DRDGold, Village said it has concluded a due diligence and is progressing towards the conclusion of the deal. According to the deal’s original schedule, Village is supposed to assume operational control of Blyvoor on February 1.
Village’s JSE-listed shares closed 2.34% higher at R2.19 on Monday
