by Gideon Madzikatidze/Simbarashe Sithole
HARARE – Mutapa Gold Resources has delivered a robust top and bottom-line beat for Q3 FY2026, leveraging firmer head grades, improved recoveries and a buoyant gold price environment to offset mill downtime at Freda Rebecca, with EBITDA margin expansion of 600 basis points signalling strong operating leverage.
The ZSE-listed gold producer reported for the quarter ended 30 September 2026 gold production and sales of 30,116 ounces, up 14% year-on-year from 26,405oz in Q3 FY2025, despite a 6% decline in ore milled to 713,000 tonnes after Mill No.1 at Freda Rebecca was off-line for 23 days in August for a long-planned shell replacement.
The production uplift was driven by grade and recovery. Head grade improved 14% to 1.50g/t from 1.32g/t on better grade control and new stope introductions, while metallurgical recovery gained 300 bps to 86% following commissioning of three and four additional leach tanks at Freda Rebecca and Jena respectively. Management flagged one Lost Time Injury, maintaining a satisfactory safety performance toward Zero Harm.
On pricing, average realised gold price rose 22% YoY to $4,211/oz from $3,440/oz, lifting revenue 39% to $127 million from $91 million.
Profitability expanded sharply. Gross profit jumped 55% to $84 million, pushing gross margin to 66% versus 60% last year. EBITDA surged 58% to $67 million, with EBITDA margin improving to 53% from 47%, reflecting cost discipline and price leverage. Profit before tax rose 80% to $61 million, while profit after tax closed 57% higher at $45 million despite a 200% increase in tax expense to $15 million on higher taxable income.
Cash costs remained contained. C1 cash costs, inclusive of administrative overheads, held flat at $1,569/oz, below the $1,600/oz threshold. All-in Sustaining Cost (AISC) – C1 plus royalties, CSR, management fees, tenement protection and stay-in-business capital – rose 13% to $2,337/oz from $2,077/oz, largely driven by elevated stay-in-business capex. Management said cash generation was strong, in line with solid production and elevated bullion prices.
Year-to-date performance is even stronger. For the nine months to September, production is up 16% to 89,639oz, realised price up 41% to $4,487/oz, revenue up 63% to $402 million, EBITDA up 133% to $231 million and PAT up 200% to $156 million. Gross margin year-to-date stands at 70% and EBITDA margin at 58%. An interim dividend of $35 million was paid in the period.
On growth, Mutapa has commenced implementation of the Shamva Hill Project on 1 October 2026, with completion targeted December 2028 at a capital outlay of $49 million. The project comprises a 2.4 million tonne open-pit mine and processing plant, which will lift annual group production from 72,000oz to approximately 80,000oz from 2028. Funding is secured after a local banking syndicate upsized the syndicated facility to $86 million from $48 million, with drawdown against the Shamva Hill capex expected until September 2027, after which the facility rolls into a term loan amortised from internally generated cashflows.
At Jena Mines, an expansion programme is underway to increase annual gold production from 12,000oz to approximately 13,000-14,000oz commencing Q2 2027, pending completion of current exploration drilling. Group-wide accelerated exploration drilling delivered approximately 88,000 metres of diamond drilling by end-September against a 190,000-metre target, with a resource upgrade at Freda Rebecca expected by January 2027.
Management maintained its 11-month to December 2026 production guidance of 119,000oz, noting financial performance is expected to remain in line with prior guidance as higher gold output will be offset by a softer gold price outlook into Q4.
The board said it will consider declaration of a final dividend after year-end.