CASE STUDY
Helping Caledonia Mining unlock opportunities with data-driven decisions
Company Overview:
Caledonia Mining Corporation Plc is a listed gold production, exploration and development company focused on Zimbabwe. In 2024, the company was interested in developing a new mine on a piece of land it had purchased. With early feasibility studies looking promising, Caledonia wanted to understand how this new venture could change its financials, and how best to fund it.
Our Partner at Caledonia Mining Corporation:
“Our business had grown to a stage where there were too many moving parts for us to evaluate it easily ourselves. We knew what we wanted to do, but it required both advanced modelling skills and advanced accounting and finance skills combined.”
- Maurice Mason, Vice President, Corporate Development
The Role of TriFidus:
TriFidus was tasked with building a corporate investment appraisal model which would use inputs from the feasibility study and Caledonia’s internal forecasting processes to demonstrate and evaluate:
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The financial impact of the development on the wider enterprise.
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The best way to structure the project from a tax, debt and equity perspective.
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Accretive value to existing shareholders, to manage the risk of dilution in the event of an equity raise.
Project Overview
The new mining project needed to be assessed on various metrics to show that it would make financial sense, and how different methods of funding would impact the business. This required competency in financial planning as well as financial modelling and analytics.
How TriFidus supported this project:
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Worked collaboratively as a business partner with senior executives at Caledonia Mining Corporation to understand their requirements.
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Created a detailed financial model which provided a three-statement forecast for each entity within the business.
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The model showed how cash flowed from the new and existing mine to the Jersey-based holding entity and finally was distributed to owners.
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Delivered the functionality to model multiple scenarios while still retaining the base case model, offering a powerful planning tool.
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Identified areas of improvement within existing planning capabilities and created solutions that went beyond the initial scope of work.
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Provided financial leadership support to improve confidence in making commercial decisions.
"I talked TriFidus through how the business functions, including fixed and variable costs and some detailed nuances to get to a bottom-line number. We then built it into our company's financial statements to forecast what our balance sheet would look like based on various scenarios."
The Results:
Caledonia now has a strategic corporate model based on accurate data from across the whole business which can be used to guide future decisions. The model is a ‘single source of truth’ which can be used not just by the corporate development team but by accounting and finance to create budgets, reports and forecasts.
The company can make choices from an informed position. Rather than focusing on the cash impact of the new project, senior executives can see the impact on the whole profit and loss, balance sheet and cash flow impact for every part of the organisation. The management team can use the model to decide how to structure tax planning, how much to spend in the domestic currency, and how much to pay to shareholders as dividends, for example.
“The model TriFidus designed and built gives us the flexibility to easily run and evaluate multiple scenarios.”
“We can justify the decisions we have come to using TriFidus’ model, based on hard data and specific assumptions.”
“Working with TriFidus has improved our governance as a listed company. It's been a very collaborative process, and I would enthusiastically recommend TriFidus."
We are grateful for the opportunity to collaborate with Caledonia Mining Corporation on these important corporate finance projects. Partnering with their dedicated teams has been a truly rewarding experience, allowing us to contribute our expertise in support of their goals.
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