Calidus Resources Financial Restructure and Discounted Placing

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Calidus Resources (ASX: CAI)

Announced that it has received firm commitments from institutional, sophisticated and professional investors for the placement of approximately 143.6 million new fully paid ordinary shares at an issue price of A$0.115 to raise approximately A$16.5m.

 

 

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Calidus Resources

Calidus Resources commemorative coin

 

 

Financial restructure positions Calidus for strong growth in cashflow and production this year

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A$16.5m placement, restructured hedge book deliveries and debt repayments will support Calidus’ three-year strategy to deliver 120,000oz per annum

 

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Calidus Resources Limited (ASX: CAI) (“Calidus” or the “Company”)  is pleased to announce that it has received firm commitments from institutional, sophisticated and professional investors for the placement of approximately 143.6 million new fully paid ordinary shares (“New Shares”) at an issue price of A$0.115 to raise approximately A$16.5m (“Placement”).

Proceeds from the Placement will be used to repay debt and provide additional working capital.

Furthermore, Calidus has reached an agreement with its supportive lender, Macquarie Bank (“Macquarie”), to restructure its hedging volume profile and its debt repayments. The restructuring will allow for significant cashflow generation in CY24 and aligns its hedging profile with its production profile as the Company aims to achieve its three year strategy to achieve production of 120,000oz per annum.

 

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HIGHLIGHTS

Firm commitments received for A$16.5m via an institutional Placement at
A$0.115 per share.
• Placement strongly supported by both new and existing shareholders, including
the Company’s lender, Macquarie Bank, for A$2.5m and the Board of Directors
for A$120,000.
• In addition to the Placement, Calidus will offer all eligible shareholders the
opportunity to participate in a Share Purchase Plan to raise up to A$3.0m on the
same terms as the Placement.
• Agreement with Macquarie to restructure hedge and debt arrangements,
resulting in an additional ~A$31m of free cashflow in CY24;
o CY24 hedge volume reduced by 21,250ozs, delivering a A$20m benefit
to Calidus at spot gold price of A$3,300/oz
o Reduced debt repayments totalling A$11m in CY24

 

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• This significant increase in cashflow generation in the first half of CY24 will enable
Calidus to organically fund the pre-strip and A$17m capital cost of developing the
high-grade Bulletin deposit in the second half of CY24
o Bulletin PFS: 63,000oz at an AISC of A$1,730/oz over 2-years mine life
Calidus re-affirms H2 FY2024 guidance of 32,000-37,000ozs at an AISC of A$2,100-
$2,400/oz.
• Calidus confirms that operations are progressing as planned with the pit cutback
due for completion at the end of March and higher grade Blue Bar ore now being
processed.
• Last week Calidus recorded its largest ever gold recovery since project inception
of 1,539ozs for the week.
• Calidus anticipates releasing a JORC 2012 Mineral Resource Estimate on initial
oxide deposits at Nullagine in Q2 CY24 that it will be targeting to mine in FY25
and build on stated LOM guidance.

 

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Calidus Managing Director Dave Reeves said:

“This financial restructure will deliver a host of substantial benefits to Calidus, headlined by increased production and cashflow this year.

 

“This will in turn help us achieve our target of producing 120,000oz per annum within three years.

“We are at an inflection point at the Warrawoona Gold Project, with gold production rising significantly in recent weeks as we see the benefits of the completion of the Klondyke cut-back and initial Blue Bar ore.

 

“When combined with reducing costs due to completion of the cut-back, lower deliveries into the hedge, lower debt repayments and record gold prices, Calidus is now in a position to generate significant cashflows.

 

“The funds from the capital raising combined with the restructuring of the hedging profile and debt repayments will enable new deposits such as Bulletin to be funded, as we methodically progress towards our aim to achieve 120,000ozs per annum in 3 years.”

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To read the full news release, please click HERE

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If you need clarification of any information contained in this note, or have any questions, I will be delighted to assist – Please email andrew@city-investors-circle.com

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Disclosure

At the time of writing the author holds shares in Calidus Resources.

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