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Welcome to the Q4 and Full Year 2018 Preliminary Production Results Call. [Operator Instructions] Just to remind you, this conference is being recorded.I'll now hand the floor to Andrew Pardey, CEO. Please begin.
Good morning, everyone. Happy New Year, and thank you for taking the time to join us on this call. I'm joined on this call with Ross Jerrard, our CFO; and Alexandra Carse, our Head of Investor Relations.As you would have seen earlier this morning, Centamin published our Q4 and full year 2018 preliminary production results.Unquestionably, this marked the end of a very challenging operational year for the company, which we fully recognize impacted our market valuation and subsequent shareholder experience and confidence. We'd like to take this opportunity to say how grateful we are for the long-standing support of our shareholders and support from the sell side community.Firstly -- with the results, firstly, the most important thing, the group achieved a zero harm record in Q4 with a Lost Time Injury Frequency Rate of 0, resulting in a 2018 result of 0.06 for the full year for 2018.Then moving on from the safety side, in Q4, we produced 138,000 ounces, which was 24 -- 28,000 ounces more than Q3, equating to an increase of 17%. This was predominantly driven by an 18% improvement in the open pit grade and a 30% improvement in the underground stoping grade.Looking at 2018 as a whole, we've produced 472,000 ounces, which, year-on-year, was 13% less. This temporary reduction in production profile last year and, therefore, guidance during the course of the year was the result of initially lower grades delivered from the open pit in the first half of 2018, as mining progressed through the transitional zone; disruption to the underground stoping sequence in Q2, resulting from the damage to the long-hole drill rig; and then the unplanned dilution from the cascading stopes in the Amun area of the underground at Sukari.The company has identified, evaluated and implemented solutions, the results of which have been reported throughout the year. And we continue to work towards improving operational efficiency.Consistency of run rate was achieved in September, October, November and December, where subsequently, September, we produced 48,500 ounces; October, we produced 45,600 ounces; November, we produced 44,500 ounces; and December, we produced 47,400 ounces. And this has demonstrated good progress with getting Sukari back to where it should be. However, there remains work and close monitoring to be done in 2019 to ensure delivery and instill confidence back to the market and our shareholders.With regards to each section of the mine, the open pit grades continue to improve as mining progresses through into the high-grade sulfides at depth and in Stage 4. We had excellent levels of material movement, which has been maintained throughout the year with good equipment utilization. With the underground, the underground delivered a quarter-on-quarter blend grade improvement of 20%, driven by the stoping grade. Stoping performed as scheduled in October and November, but we had a slight impact of dilution in November.With development side, development grades were lower, and this was partially due to -- the development for a longer-term access to future stoping but also extending some of the development on the existing stoping areas as drilling had identified short but small extensions to the stoping blocks.For the processing plant, the processing plant performed as normal. We had record quarterly and yearly throughput. The plant is operating very well.Head grade was significantly improved this quarter, up 12% to 1.45, and recoveries were also slightly higher at 89.1%. Head grade for the year was 1.26 grams per tonne, down 20% year-on-year. But processing recoveries were strong, and that -- for the year, they're at 88.7%, which is up 1% year-on-year.2018 has been a very tough year, but our team has shown character and dedication. Q4 is a solid result, and we're progressing to 2019 with confidence.We're keeping this call very brief. But at this stage, I would be happy to open up to questions. But please can I remind everyone, as we have previously announced, our reserve and resource update and full year 2019 guidance, including cash costs, all-in sustaining costs, will be published with the annual results in February?Until that point, Centamin cannot answer any questions with regards to future performance beyond what was announced this morning. The purpose of today's announcement is to provide the market with the production performance from Sukari for the final quarter of 2018 and for the whole year of 2018.With that, I'd like to say thank you very much and hand back to the operator for any questions.
[Operator Instructions] Our first question comes from the line of James Bell of RBC Capital Markets.
Just a question on the underground dilution that you saw in December. Could you maybe just give a little bit more detail on what the situation was there and perhaps remind us of what the specific measures you are taking to combat this dilution into 2019?
Look, the underground dilution we saw in December was some of the remnants from the last year at a large cascading stope, which played a bigger impact than what we had initially expected. And what have we done to remedy that? We've been -- we've now -- using more pillars in the process rather than having open stopes open over 2 to 3, maybe 4 levels. We're now putting in pillars so the stopes are only open over a maximum of 2 levels.
And then just in terms of the dilution assumptions that you used for your underground reserve grade last year, would you expect those to change into 2019 given the situation that you found with the cascading stopes this year?
Well, dilution levels depend on the type of stoping whether it's a long-hole open stope or if it's a cut-and-fill stope, but they'll vary accordingly. But yes, we are being more conservative on our dilution than we have been previously. But we're also -- as a result of that, we're also putting in more pillars in place to ensure we don't get the additional levels of dilution that we experienced during 2018.
Our next question comes from the line of Alan Spence of Jefferies.
James actually already asked one of my questions. I guess, the other one would be just in terms of the key personnel changes you mentioned in Q4 and also to be made in 2019. If you could just elaborate a little bit more on that?
Well, I mean, during 2018, we brought in Mark Morcombe as the Chief Operating Officer in here. Mark's background and experience is really underground mining. We've brought in Raitt Marshall. He's a General Manager at Sukari. We have a new underground manager commencing this month. And there's been a few other personnel changes at the lower level in production area for the open pit and also in the processing plant.
[Operator Instructions] Okay. We have one further question coming through. That's from the line of [ Anthony ] [indiscernible].
You're having a new long-hole drilling rig delivered soon, I understand. Will that be sort of starting to work in -- very soon or when will we actually...
Tony, the carrier for the long-hole drill rig is on site. That's already on site, and the rest of the rig has already arrived on site. Will it be utilized? No, it's just a backup machine. A long-hole drill rig is only utilized a maximum of 40% of the time. But we will have a spare unit, so if we had a problem like we had last year, we'd have a unit to be coming in and operate.
Great. Because I saw on the Capital Drilling site that this is a remote-controlled unit. And I wondered if this would be used in preference to the one that you're already using.
No, Capital Drilling is in the open pit. All the underground drilling is done by our underground mining contractor, Barminco.
[Operator Instructions] Okay. So there are no further questions coming through. I'll hand back to our speakers for the closing comments.
Okay, thank you very much, everyone, for joining this brief call. I look forward to updating you in February with our full year results, our production guidance results and reserve updates.In the meantime, if you have any further questions, feel free to contact myself, Alex or Ross. With that, I'll hand back to the operator. Thank you very much.
Thank you. This now concludes the conference. Thank you very much for attending. You may now disconnect.