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Business Reporter

Victoria Falls Stock Exchange-listed entity Padenga Holdings reported significant growth in volumes at both its gold and crocodilian divisions for the financial year ended December 31, 2023.

Gold production volumes at the gold mining unit, Dallaglio, were up 16 percent to 2 275kg (73 126o ounces) from 1 961kg (63 039oz) achieved in the prior year.

Eureka Mine contributed 1 620kg (72 percent) of the total gold production for the group compared to 1 352kg (69 percent) in 2022. The balance came from Pickstone Mine, which saw increased production following the commissioning of its underground mine in September 2023.

Chief executive officer Mr Michael Fowler said Pickstone Mine continues to access supplementary ore from open pits to complement the underground feed during the ramp-up phase.

A total of 2,120kg of gold was sold during the period under review.

At the crocodilian division, skin sales volumes increased by 101 percent to 66 725. Of these, 25 841 skins were carried into 2023 from the post-Covid market decline.

Skins harvested for the period reached 50 675, up 49 percent from the prior year, while skins sold at 66 725 were up 101 percent year-over-year.

Mr Fowler said there was also an improvement in the size of the skins sold, with the total length sold in centimetres increasing by 117 percent to 2 424,868 cm, compared to 1 116,898 cm previously.

This resulted in a 31 percent increase in revenue for the crocodile division to US$29,9 million. The remaining revenue of approximately US$125,7 million came from the gold division.

Total revenue for the group thus stood at US$155,57 million, up 22 percent from US$127,89 million in the prior year.

Finance director Mr Oliver Kamundimu attributed the revenue performance growth to improved production volumes and average selling prices realised by both operating units.

However, ballooning costs saw operating profit before depreciation and amortization slump 17 percent to US$26,7 million. The group recorded an EBITDA of US$26,6 million, down from US$32,3 million.

Mr Kamundimu said the decline was mainly due to the impact of mandatory surrender requirements, old stock skins sold at a discount and increased operating costs.

Profit before tax, however, was up a marginal 3 percent to US$14,3 million. This is after finance costs decreased by 15 percent to US$8,87 million from US$9,9 million in the prior year.

The company declared a dividend of26 US cents per share payable in respect of all ordinary shares.

Looking ahead, crocodile skin prices are forecast to remain firm in the market according to Mr. Fowler. 

He added that the business will also benefit from improved skin quality. Sales are almost guaranteed with 60 percent of skin sales for 2024 already contracted with a long-standing customer.

Mr Fowler said the sale of the remaining 40 percent of uncontracted skins is yet to be concluded.

“However, initial indications from customers are positive due to the improved quality,” he added.

For the mining division, which is one of the top three gold producers nationally, Mr Fowler said development at the Pickstone underground mine continues.

“As we progress with development, we expect ore grades and volumes to improve. This will increase our production volumes and efficiencies,” he said.

“Production at Eureka Mine is strong and continues to be slightly ahead of forecast,” Fowler concluded.

The group is aiming to produce between 80 000 and 85 000oz of gold and targeting to sell 51 508 crocodile skins in 2024.