- Net Profit Surge: Skyrocketed by 493%, reaching $8.9 million
- Taxes and royalties paid nearly tripled to $11.8 million
- Global Demand: Total demand reached a record 1,206 tonnes in Q1
Source: World Gold Council, Equity Axis Research
Harare- Caledonia Mining Corporation, Zimbabwe’s third-largest gold producer, has delivered a remarkable financial performance in the first quarter of 2025, with net profit soaring by 493% to US$8.9 million from US$1.5 million in the same period of 2024.
This extraordinary growth was underpinned by a combination of increased gold production and (from both Blanket Mine, the flagship contributing over 90% and Bilboes still under maintenance contributing 12 kg) robust global gold prices, which together drove a 46% surge in revenue to US$56.2 million from US$38.5 million.
The company’s operational success translated into a significantly higher contribution to Zimbabwe’s public coffers, with royalties and taxes paid to the government nearly tripling to US$11.8 million from US$4.5 million.
This financial windfall reflects not only Caledonia’s operational efficiency but also the favourable market conditions that have bolstered the gold mining sector in 2025.
The surge in profitability was primarily driven by a 9.3% increase in gold output, with production rising to 535.8 kilograms from 489.3 kilograms in Q1 2024.
“435 ounces of gold were produced from the Bilboes oxide mine in the Quarter (Q1 2024: 426 ounces).
“Work continues on finalising the feasibility study for the Bilboes project, with a focus on optimising the economics in response to updated capital cost projections,” Mark Learmonth, the company’s CEO said in a trading update.
“The Company is evaluating various development scenarios to maximise shareholder returns.”
This uptick was supported by improved weather conditions following the easing of the rainy season, which facilitated smoother mining operations, and additional contributions from the Bilboes oxides mine.
These operational gains were amplified by a buoyant global gold market, where prices surged by 1.8% year-on-year to an average of US$2,860 per ounce, according to the LBMA (PM) gold price index.
The 40% rise in gold prices (Q1) provided a significant tailwind for Caledonia, enhancing the value of its output and directly contributing to the company’s revenue growth. The interplay of higher production and elevated prices created a virtuous cycle, positioning Caledonia to capitalise on market dynamics effectively.
On the global stage, gold demand reached a record 1,206 tonnes in Q1 2025, marking the highest first-quarter figure since 2016. This demand was driven by a 1% year-on-year increase, fueled in part by over-the-counter (OTC) investment, which reflects growing investor appetite for gold as a safe-haven asset amid economic uncertainties.
Central banks also played a pivotal role, purchasing 244 tonnes of gold during the quarter, a figure that, while lower than the previous quarter, underscores sustained institutional confidence in gold as a reserve asset.
This steady demand from central banks, coupled with robust investment activity, has kept gold prices elevated, benefiting producers like Caledonia.
On the supply side, global gold supply grew modestly by 1% to 1,206 tonnes, supported by a record Q1 mine production of 856 tonnes, which ensured that supply kept pace with demand without exerting downward pressure on prices.
Caledonia’s performance in Q1 2025 highlights the broader strength of the gold mining sector in Zimbabwe and globally. The company’s ability to leverage higher production and favourable market conditions has not only driven exceptional profitability but also significantly boosted its contributions to the Zimbabwean government, reinforcing its role as a key economic player.
The near-tripling of tax and royalty payments to US$11.8 million reflects the mining sector’s importance to public finances, particularly in a resource-rich nation like Zimbabwe.
Looking ahead, sustained global demand, particularly from central banks and investors, coupled with Caledonia’s operational improvements, suggests that the company is well-positioned to maintain its upward trajectory, provided external factors such as weather and geopolitical stability remain favourable.
This confluence of internal efficiencies and external market dynamics paints a promising picture for Caledonia and the broader gold industry in 2025.
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