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Shares in Caledonia Mining (LON:CMCL,TSE:CAL) rose 10% after it forecast a sharp rise in annual production next year accompanied by a fall in costs.
It is expecting output from the Blanket mine in Zimbabwe to rise 17% to 50,000 ounces of gold metal as it accesses new ore bodies via its No 6 Winze Project in the middle of 2016.
The update came as part of an end-of-year trading update in which Caledonia said it mined 11,518 ounces of the yellow metal in the final quarter of 2015, up almost 11% year on year and taking the total to 42,806 ounces.
Production is expected to be 10,700 in the first quarter, rising to 14,000 ounces of gold by the final three months of the year, reflecting the contribution from No 6 Winze, which provides access to three deeper-lying resource bodies.
With fixed overheads stable, all in sustaining costs should edge down from the current US$969 per ounce.
The shares rose 4.2p to 44.7p in early afternoon trade.
"Fourth-quarter production represents the third successive quarterly increase in gold production from the Blanket mine and lends additional credence to the achievability of the unchanged 2016 production guidance," said the boutique research house SP Angel.