Dallaglio, the gold mining arm of Padenga Holdings, produced 16% more gold in the first half of the year and expects further growth as it brings a newly refurbished underground mine into production.
Gold output was 1,080kg in the six months to June, beating the 933kg of last year. This was largely due to increased production at Eureka Mine in Guruve. Padenga took over the mine two years ago after it had been shut down for over 20 years. The company has also now finished the first phase of underground refurbishment at Pickstone Peerless Mining, near Chegutu, which will further increase gold output.
Dallaglio recorded revenue of US$62.6 million at the half year, 21% up from US$51.7 million over the same period last year, benefitting from higher production and firmer gold prices. However, profit before tax fell to US$5.2 million from a US$12.9 million last year. This was because of the costs incurred on the works at Pickstone, which have increased due to the rising global prices of inputs and logistics.
Padenga was previously mostly a crocodile skin company, but it pivoted to mining as the skins market hit a downturn. Now mining makes up 84% of group revenues.
“For the second year running, Eureka mine continues to deliver robust performance, contributing significantly to volume growth and profitability. Various operations and cost optimisation initiatives are in progress to further consolidate this growth,” Padenga reports.
Earnings from gold mining are set to increase even further after Dallaglio completed the refurbishment of underground mining at Pickstone, which previously depended on lower-grade opencast mining.
Says Padenga: “An area of key focus is operationalising Pickstone Peerless underground mining. The first phase of the project was completed in August 2023, and commercial production has started. This is poised to contribute significantly to the Group’s revenue and profits, going forward.”
Dallaglio’s performance cements its spot among the top three gold producers in the country, together with Caledonia Mining and Freda Rebecca, the largest producer.
During a recent tour of Eureka Mine, Dallaglio officials projected that the company will ramp up gold output to 3,000kg per year by 2025.
“We are now as a combined 210 kgs per month, we are looking to get to 230 kgs next year due to grade improvements. In 2025, we are looking at 250 kgs per month with Pickstone underground and Eureka Open pit,” Pickstone Peerless Mine General Manager Alfred Madowe said. – (NewZWire)