ENDEAVOUR Mining CEO Ian Cockerill promised strategic continuity without the controversy, saying at the gold miner’s 2023 results presentation on Wednesday that he intended to “make sure this is a good, clean organisation”.
Endeavour said earlier today that an investigation into former CEO Sébastien de Montessus found he had diverted $20.9m in three transactions to a company in the United Arab Emirates (UAE) between 2020 and 2021. The ultimate beneficiaries of the UAE company were unknown; nonetheless, it considered the investigation closed.
“It’s fair to say any organisation takes on the flavour of people who are leading it and what we want to do is make sure … we act with transparency and do the right things,” said Cockerill. “I believe we can get there and I wouldn’t have taken on job if it was not possible.”
De Montessus contested Endeavour’s investigation, saying he had not been given the opportunity to respond to its findings prior to their publication.
In response to analyst questions, Cockerill said his company would focus on asset optimisation and prefer growth through exploration rather than mergers and acquisitions. “Historically there has been a lot of M&A. That did help position the company. But that phase has run its course,” Cockerill said.
“I still think there is potential for making the assets we have got sweat.” He identified the completion of the $448m Lafigué project in Côte d’Ivoire and the $290m Sabodala-Massawa expansion in Senegal, as well as the development of Tanda-Iguela project in Côte d’Ivoire, to be renamed ‘Assafou’, as key targets for this year.
Endeavour guided to 90,000 to 110,000 ounces in gold production from Lafigué once ramp-up begins in the second quarter. The mine has an nameplate capacity of about 200,000 oz/year. Cockerill said Assafou was one of West Africa’s “most significant low cost” discoveries.
Cockerill was also asked about Endeavour’s future geographic footprint considering increasing levels of political risk in West Africa, especially Burkina Faso which has been victim to jihadist attacks. There had been “a subtle” refocus with the recent sale of the firm’s Burkina Faso’s mines Boungou and Wahgnion, he said.
As for a new shareholder returns philosophy, considering the current three year minimum dividend policy closed on December 31, Cockerill said shareholders could expect a similar “guaranteed” payout once the company had finalised its approach in three to four months.
Endeavour declared $200m in total dividends for 2023 and completed $66m in share buy-backs. This was despite disappointing results in which share earnings fell amid lower year-on-year production of 1.07 million oz even after accounting for discontinued operations.
Given its resource to reserve project pipeline, Endeavour expected to become increasingly leveraged this year after reporting net debt of $555m as of December 31 (2022 Dec 31: $445m).
