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Shanta Gold smashes records as revenues soar

Last updated: 07:51 21 Feb 2024 GMT, First published: 15:30 28 Sep 2023 BST

Snapshot

  • Shanta Gold bidder highlights proxy firms' recommendations
  • Shanta Gold set to generate around US$1bn in revenue over the next five years, as gold production ramps up
  • Shanta Gold's good run of form continuing, says broker
  • Shanta Gold CEO says "life is good at Shanta" ahead of planned handover
gold

About the company

Shanta Gold Ltd is an East Africa-focused gold producer, developer, and explorer.

The company has an established operational track record, with defined ore resources on the New Luika and Singida projects in Tanzania, with reserves of 625 koz grading 2.91 g/t, and exploration licences covering ~800 km2 in the country.

Alongside New Luika and Singida, Shanta also owns the high-grade West Kenya Project in Kenya and licences with resources of 1.7 million ounces.

How it is doing

21 Feb 2024

Shanta Gold’s bidder has noted two Independent proxy advisory firms, Glass Lewis and Institutional Shareholder Services (ISS), have recommended shareholders vote in favour of the offer.

Bid vehicle Saturn Resources has made an all-cash bid worth 13.5p per share, valuing the East Africa-focused gold miner at £141 million plus an interim dividend of up to 0.15p.

Badal Patel, chief financial officer of the bidding vehicle, said: "Bidco believes that the recommendations from ISS and Glass Lewis to vote in favour of the acquisition are a further endorsement of the opportunity the acquisition represents for Shanta Shareholders.

"These recommendations are in addition to the support of the acquisition received by Bidco from Shanta's two largest shareholders, via an irrevocable undertaking and a letter of intent, and from those Independent Shanta Directors who are shareholders, representing, in aggregate, over 18% of Shanta Shares in issue."

22 Jan 2024

Shanta Gold Ltd (AIM:SHG, OTC:SAAGF) topped 100,000 oz of gold produced for the first time in 2023 as its new mine at Singida in Tanzania continued its good start.

Singida helped offset a moderate slowdown at New Luika, also in Tanzania, said Eric Zurrin, Shanta’s chief executive.

11 Jan 2024

Shanta Gold said assays from the latest drilling at its New Luika gold mine in Southwestern Tanzania relating to 2023 drilling showed decent intercepts in the three areas.

Eric Zurrin, chief executive, said: "We restarted drilling at New Luika in July 2023 as the team looked to convert Inferred resources to the Indicated category at various deposits, in addition to the testing of a maiden target at Jamhuri West close to the NLGM Processing Plant.

Insight: Shanta Gold set to generate around US$1bn in revenue over the next five...

08 Aug 2023

Record second quarter production from Shanta Gold Limited (AIM:SHG, OTC:SAAGF)’s Tanzanian mining operations generated more than US$23mln of quarterly earnings and set the company well on the road to wiping out the last of its legacy debt from construction.

At the end of the quarter to end June 2023 Shanta had net debt of just US$8.7mln, down more than 50% quarter-on-quarter, and surely set for eradication by the time 2024 rolls around.

What the brokers say

23 Oct 2023

Shanta Gold Ltd (AIM:SHG, OTC:SAAGF)’s strong run of form is continuing, says house broker Liberum, with both of its operating mines in Tanzania delivering above expectations in its latest quarter.

Guidance for the year to end December 2023 was reiterated at 90-98,000oz of gold production, but Liberum expects the company to come in just over the top of that.

The new mine, Singida, was the standout on continuing excellent gold recoveries of 97.4%, it added, “which bodes well for Life of Mine lift in expectations”, added the broker.

What management says

10 Aug 2023

Shanta Gold Limited (AIM:SHG, OTC:SAAGF) chief executive Eric Zurrin speaks to Thomas Warner from Proactive about how the East Africa-focused gold producer, developer and explorer has been performing so far this year.

He says that "life is good at Shanta" following a quarter in which production surged by 92% to 29,000 ounces and EBITDA leapt by 207% to $23mln, leading to an attractive EBITDA ratio of under two times. Additionally, net debt plunged by 54% to $9 million, representing a $10 million debt reduction in just one quarter.

Zurrin attributes these gains to the new mine, Singida, which has been a significant addition to their portfolio and also emphasises Tanzania's thriving mining sector, noting major investments by global giants like BHP and Barrick, underscoring the country's favourable business climate.

Shanta Gold CEO says "life is good at Shanta" ahead of planned handover

Shanta Gold Limited (AIM:SHG, OTC:SAAGF) chief executive Eric Zurrin speaks to Thomas Warner from Proactive about how the East Africa-focused gold producer, developer and explorer has been performing so far this year. He says that "life is good at Shanta" following a quarter in which...

on 10/8/23