Mandalay Resources Corp. (TSX:MND, OTCQB:MNDJF) reported first-quarter gold production that fell short of internal expectations, but the company’s new CEO isn’t lowering full-year guidance.
The Toronto-based company posted consolidated saleable gold equivalent production of 19,986 ounces and consolidated saleable gold equivalent sales of 21,769 ounces.
That wasn’t quite to plan. Enter new CEO Frazer Bourchier, who took on the role on April 6.
"Mandalay's metal production rate at both sites during the first quarter of 2023 was below plan,” Bourchier said. “However, despite production being lower than our previous quarters and below our internal expectations, the management team have identified the temporary root causes that lead to this shortfall and are focused on risk mitigation and elimination to get us back on plan with expected improvements at both sites in the coming quarters.”
Case in point, Mandalay is sticking to its annual production guidance range of 105,000-118,000 gold equivalent ounces.
Chief operating officer Ryan Austerberry explained the root causes.
"At Costerfield, processed grades were below expectations as the feed to the mill required a higher volume of lower grade stockpile material to supplement the lower level of mined tonnes during the quarter,” Austerberry said. “The site is also working on a few personnel constraints as it navigates through a tight labour market. This productivity gap is shrinking as we hire support contractors, further train new employees and invest in our current workforce following a higher than usual turnover of staff over the last few quarters.”
He continued: “In addition to this constraint, there was a seven-day power outage at the start of the year due to the failure of an incoming power cable feeding the underground, resulting in a temporary loss of power. Although production ramped up shortly after this outage, January's production rate was adversely impacted. As a result of these issues, the site produced 11,017 saleable gold equivalent ounces in the first quarter of 2023, lower as compared to the same period last year.”
To get back on track, Mandalay said it has hired additional contractors and adjusted equipment to “assist with availability at both sites."
Al full breakdown of the results can be found here.
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
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