Banro Corporation - Q1 2013

Company Profile

Banro Corporation is a Canada-owned gold exploration and development company with four wholly owned mining projects along the major gold belt of the Democratic Republic of the Congo (DRC)'s eastern provinces. The company owns mining licences for four projects in the regions of Twangiza, Lugushwa, Namoya and Kamituga, whose combined gold resources are estimated at 2.4moz (mn ounces) of gold within alluvial and hard rock sources. The company's 'phase one' gold mine at its Twangiza project, which is expected to be able to process 1.3mnt (mn tonnes) of ore a year,  was scheduled to begin operations in 2012.

SWOT Analysis


• Banro Corp is one of the largest gold miners currently operating in the DRC with four wholly owned licences. It could therefore benefit from first mover advantage as the country's mineral wealth opens up to investors.

• The company has no debt and plans to finance later stages of its projects by mining the high-grade reserves initially.

• The company's Twangiza mine is expected to begin production in 2012. The mine has proven and probable gold reserves of 4.54moz.


• The company's operations are limited to the DRC, which has a volatile political and economic past. We expect the DRC government to increase its share in mining projects and possibly raise taxes over the course of 2012.

• The company reported a net loss of US$9.3mn in 2011.

• The company has yet to produce its first gold and thus has missed out on the recent elevation in gold prices.


• The DRC is in the early stages of its mining development with a relatively few number of international firms currently present.

• The company's landholding in the DRC is 5,251km 2, of which less than 5% has so far been explored. Thus there are substantial possibilities that further growth could be in store.

• We expect gold prices to remain elevated in 2012 and 2013, averaging US$1,650/oz and US$1,675/oz, respectively.


• There is continuing violence in the east of the DRC where Banro's deposits are located.

• The absence of sound infrastructure in the country, particularly around the mine poses problems for the long-term development of the project.

• The relationship between the DRC government and foreign mining firms remain uneasy following the removal of First Quantum's licences in 2010.

Company Strategy

Banro Corp's immediate objective is the development of its Twangiza project, which is due to come online in 2012. Looking ahead, the firm is targeting rapid growth of its DRC-based operations and notes 'excellent potential to add future resources'. The company is fully committed to establishing its presence in the DRC before targeting other markets, citing the 2006 presidential elections and the introduction of the 2003 mining code as a sign of the country's favourable mining climate for some time to come.

Contact Details

  • Banro Corporation
    1 First Canadian Place 100 King St West
    Suite 7070
    POB 419
    Toronto, ON
    Canada M5X 1E3
  • Tel: +1 416 366 2221
  • Fax: +1 416 366 7722

Table: Banro - Financial Results

2006 2007 2008 2009 2010 2011
Revenue (US$mn)
EBITDA (US$mn)-5.5-10.3-6.2-7.6-10.3-10.2
 - % chg y-o-y-4.686.5-39.321.235.9-1.1
Net Income (US$mn)-3.1-4.3-8.5-4.8-3.0-9.3
 - % chg y-o-y-
Debt to EBITDA0.
Source:BMI, Bloomberg
This article is tagged to:
Sector: Mining
Geography: Congo, Congo, Congo, Congo

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