Gold production at Caledonia Mining's (TSE:CAL, LON:CMCL) Blanket mine in Zimbabwe reached an "all time high" in the third quarter.
It produced 12,918 ounces of the precious metal - 12 per cent higher than the 11,560 ounces in the second quarter to June 30.
Production from the underground mining in the three months to September 30 was the highest ever produced by the mine since it first recorded production in 1906, the firm said.
President and chief executive Stefan Hayden said Q3 production had shown a "substantial" improvement in gold production.
"Increased gold production, further improvements in gold recoveries and continued close attention to costs contributed to a reduction in average operating costs from US$547 per ounce of gold produced in the preceding quarter to US$508 per ounce of gold produced," he said.
"Blanket is now one of the lowest cost gold producers in both Africa and the world."
Hayden added that work continued at Blanket's satellite properties and on the deeper level development and exploration at Blanket.
"Caledonia's financial position continues to improve. With almost $25 million of cash on hand Caledonia has sufficient cash resources to invest in its existing projects and also in potential new opportunities," he added.