TORONTO, Feb. 21, 2017 /PRNewswire/ - Richmont Mines Inc.
(TSX: RIC) (NYSE: RIC) ("Richmont" or the "Corporation") announces
operating and financial results for the three and twelve months
ended December 31, 2016, driven by
solid results from the Island Gold Mine. The Corporation will host
a conference call and webcast on Tuesday,
February 21, 2017, beginning at 8:30
a.m. Eastern Time (details below.) (All amounts are in
Canadian dollars, unless otherwise indicated.)
Fourth Quarter and Annual Highlights
- Company-wide production for the quarter was 29,505 ounces of
gold (27,759 ounces sold), a 32% increase over Q4 2015, which
contributed to record annual production of 104,050 ounces of gold
(102,660 ounces sold), a 6% increase over 2015, achieving the high
end of revised production guidance for the year.
- The solid performance was driven by production from the
cornerstone Island Gold Mine of 24,086 ounces of gold (22,422
ounces sold) for the quarter, a 70% increase over Q4 2015, and
83,323 ounces of gold (82,273 ounces sold) for 2016, a 51% increase
over 2015, exceeding revised production guidance for the year.
- Richmont reported fourth quarter revenues of $44.2 million (US$33.1
million), a 39% increase over Q4 2015 and record annual
revenues of $168.7 million
(US$127.3 million), a 17% increase
over 2015.
- Company-wide cash costs[1] for the quarter were $952 per ounce (US$714 per ounce), a 7% decrease over Q4 2015 and
$908 per ounce (US$685 per ounce) for 2016, a 7% decrease over
2015 and in-line with revised cash cost guidance for the year.
- Cash costs for the Island Gold Mine were $826 per ounce (US$619 per ounce) for the quarter, a 19% decrease
over Q4 2015 and $779 per ounce
(US$587 per ounce) for 2016, a 24%
decrease over 2015 and below revised guidance for the year.
- Company-wide All-In-Sustaining-Costs1 ("AISC") for
the quarter were $1,229 per ounce
(US$922 per ounce), a 26% decrease
over Q4 2015 and $1,272 per ounce
(US$960 per ounce) for 2016, a 7%
decrease over 2015 and in-line with revised AISC guidance for the
year.
- AISC for the Island Gold Mine were $912 per ounce (US$683 per ounce) for the quarter, a 42% decrease
over Q4 2015 and $988 per ounce
(US$745 per ounce) for 2016, a 32%
decrease over 2015 and below revised guidance for the year.
- Earnings for the quarter were $1.1
million (US$0.8 million), or
$0.02 per share (US$0.01 per share), a $5.2
million improvement over the Q4 2015 loss of $4.1 million. Earnings for 2016 were $12.5 million (US$9.4
million), or $0.20 per share
(US$0.15 per share), an 84% increase
over 2015.
- Operating cash flow2 for the quarter was
$12.6 million (US$9.5 million), or $0.20 per share (US$0.15 per share), an 86% increase over Q4 2015.
Operating cash flow for 2016 was $48.2
million (US$36.4 million), or
$0.79 per share (US$0.60 per share), a 14% increase over
2015.
- Richmont ended the year with a strong cash balance of
$75.1 million (US$55.9 million) that is expected to fully
support the Corporation's organic growth strategy.
____________________________
1
|
Non-IFRS performance
measure. Refer to the Non-IFRS Performance Measures section
contained in the 2016 Management's Discussion and
Analysis.
|
2
|
Operating cash flow
presented is after changes in non-cash working capital.
|
Recent Corporate Highlights
- On February 2, 2017, Richmont
announced a projected increase of up to 15% in 2017 company-wide
production guidance to between 110,000 and 120,000 gold ounces,
including high-quality production growth from the Island Gold Mine
to between 87,000 and 93,000 gold ounces. The increase in
production is expected to drive a decrease of up to 8% in cash
costs both company-wide and at the Island Gold Mine.
- On January 31, 2017, Richmont
announced Mineral Reserves and Resources as of December 31, 2016. Mineral Reserves at the
cornerstone Island Gold Mine increased by 34% (net of depletion) to
752,200 ounces of gold, at an increased grade of 9.17 g/t gold.
Inferred resources increased by 30% (net of conversion) to 995,700
gold ounces, at an increased grade of 10.18 g/t, at an average
discovery cost of less than $35 per
ounce.
- On January 25, 2017, Richmont
announced the appointment of Mr. Rob
Chausse as Chief Financial Officer effective March 20, 2017.
- On December 19, 2016, Richmont
announced the receipt of the required permit amendments that allow
for ore mining and processing rate increases to an average of 1,100
tonnes per day as contemplated in the Expansion Case Preliminary
Economic Assessment ("Expansion Case PEA") that is currently under
review.
"We have reported a number of key milestones for 2016, including
record company-wide production. The strong performance was driven
by another consecutive year of solid results from the Island Gold
Mine, which exceeded all annual production and cost guidance
metrics," stated Renaud Adams, CEO.
He continued, "2016 was a pivotal year for Island Gold. During the
year we completed a strategic underground mine and mill upgrade,
advanced the accelerated underground development program and
received the amended permits to increase mine and mill throughput
rates to 1,100 tonnes per day. In 2017 we will continue to
focus on positioning the Island Gold Mine for long-term success
that drives shareholder value creation, which is supported by a
solid balance sheet and a disciplined management team."
Financial Highlights
(in thousands of
$, except per share amounts)
|
Quarter
ended Dec. 31, 2016
|
Quarter
ended Dec. 31, 2015
|
Year
ended Dec. 31, 2016
|
Year
ended Dec. 31, 2015
|
Revenue from mining
operations
|
44,204
|
31,864
|
168,700
|
143,733
|
Net earnings (loss)
per share, basic
|
0.02
|
(0.07)
|
0.20
|
0.12
|
Operating cash flow,
per share
|
0.20
|
0.12
|
0.79
|
0.74
|
Adj. operating cash
flow, per share(1)(2)
|
0.17
|
0.04
|
0.80
|
0.60
|
Net free cash flow,
per share(2)
|
(0.05)
|
(0.27)
|
(0.25)
|
(0.17)
|
Revenue from mining
operations (US$)
|
33,134
|
23,861
|
127,340
|
112,406
|
Net earnings (loss)
per share, basic (US$)
|
0.01
|
(0.05)
|
0.15
|
0.09
|
Operating cash flow,
per share (US$)
|
0.15
|
0.09
|
0.60
|
0.58
|
Adj. operating cash
flow, per share(1)(2) (US$)
|
0.13
|
0.03
|
0.61
|
0.47
|
Net free cash flow,
per share(2) (US$)
|
(0.04)
|
(0.21)
|
(0.19)
|
(0.13)
|
(1)
|
Before changes in
non-cash working capital.
|
(2)
|
Non-IFRS performance
measure. Refer to the Non-IFRS performance measures section
contained in the 2016 Management's Discussion &
Analysis.
|
Operational Highlights
|
Quarter
ended Dec. 31, 2016
|
Quarter
ended Dec. 31, 2015
|
Year
ended Dec. 31, 2016
|
Year
ended Dec. 31, 2015
|
Gold produced
(oz)
|
29,505
|
22,380
|
104,050
|
98,031
|
Gold sold
(oz)
|
27,759
|
21,576
|
102,660
|
96,895
|
Average cash costs
per ounce ($)(1)
|
952
|
1,028
|
908
|
972
|
Average AISC per
ounce ($)(1)
|
1,229
|
1,660
|
1,272
|
1,368
|
Average realized gold
price per ounce ($)
|
1,589
|
1,474
|
1,640
|
1,480
|
Average cash costs
per ounce (US$)(1)
|
714
|
770
|
685
|
760
|
Average AISC per
ounce (US$)(1)
|
922
|
1,243
|
960
|
1,070
|
Average realized gold
price per ounce (US$)
|
1,191
|
1,104
|
1,238
|
1,157
|
(1)
|
Non-IFRS performance
measure. Refer to the Non-IFRS performance measures section
contained in the 2016 Management's Discussion and
Analysis.
|
Island Gold Mine Highlights
ISLAND GOLD
MINE
|
Quarter
ended
Dec. 31,
2016
|
Quarter
ended
Dec. 31,
2015
|
Year
ended
Dec. 31,
2016
|
Year
ended
Dec. 31,
2015
|
Gold produced
(oz)
|
24,086
|
14,203
|
83,323
|
55,040
|
Gold sold
(oz)
|
22,422
|
13,504
|
82,273
|
52,363
|
Cash costs per ounce
($)(1)
|
826
|
1,019
|
779
|
1,027
|
AISC per ounce
($)(1)
|
912
|
1,580
|
988
|
1,453
|
Realized gold price
per ounce ($)
|
1,592
|
1,476
|
1,639
|
1,481
|
Cash costs per ounce
(US$)(1)
|
619
|
763
|
587
|
803
|
AISC per ounce
(US$)(1)
|
683
|
1,183
|
745
|
1,136
|
Realized gold price
per ounce (US$)
|
1,193
|
1,105
|
1,237
|
1,158
|
Underground
tpd
|
977
|
657(2)
|
869(3)
|
659(2)
|
Mill
tonnes
|
83,091
|
60,352
|
297,757
|
242,137
|
Mill tpd
|
903
|
656(2)
|
814(3)
|
663(2)
|
Head grade (g/t
gold)
|
9.31
|
7.62
|
9.02
|
7.31
|
Recoveries
(%)
|
96.9
|
96.0
|
96.5
|
96.8
|
Sustaining costs
($000's)
|
1,920
|
7,576
|
17,203
|
22,330
|
Project costs
($000's)
|
11,535
|
14,505
|
39,925
|
30,894
|
Non-sustaining
exploration ($000's)
|
3,899
|
2,865
|
14,802
|
4,600
|
Sustaining costs
(US$000's)
|
1,439
|
5,673
|
12,985
|
17,463
|
Project costs
(US$000's)
|
8,646
|
10,862
|
30,137
|
24,160
|
Non-sustaining
exploration (US$000's)
|
2,923
|
2,145
|
11,173
|
3,597
|
(1)
|
Non-IFRS performance
measure. Refer to the Non-IFRS performance measures section
contained in the 2016 Management's Discussion and
Analysis.
|
(2)
|
2015 productivity
includes a 3-week underground mine shutdown and a 2-week mill
shutdown in Q4 2015.
|
(3)
|
2016 productivity
includes a 16-day underground mine shutdown and a 25-day mill
shutdown in Q3 2016.
|
- At the end of the year, the Island Gold Mine reported over 6
years of operations without lost-time injury.
- Production for the quarter was 24,086 ounces of gold (22,422
ounces sold) and 83,323 ounces of gold (82,273 ounces sold) for the
year, a 51% increase over 2015, exceeding revised production
guidance for the year.
- Cash costs for the quarter were $826 per ounce (US$619 per ounce). Cash costs for 2016 were
$779 per ounce (US$587 per ounce), a 24% decrease over 2015 and
below revised guidance for the year.
- AISC for the quarter were $912
per ounce (US$683 per ounce). AISC
for 2016 were $988 per ounce
(US$745 per ounce), a 32% decrease
over 2015 and below revised guidance for the year.
- Underground mine and mill productivities for the quarter
averaged 977 and 903 tonnes per day, respectively, which is
consistent with the 2017 production scenario considered in the
Expansion Case PEA that is currently under review. For 2016,
underground mine and mill productivities averaged 869 and 814
tonnes per day, respectively, a 32% and 23% improvement over
2015.
- During the quarter, long-hole stope mining began in the eastern
and western extensions of the second mining horizon and development
in ore began in the higher-grade third mining horizon.
- The development of the main ramp continued and reached a
vertical depth of 846 metres at the end of the quarter. It is
expected that the ramp will reach the bottom of the higher-grade
third mining horizon at the 860 metre level in the first quarter of
2017.
- Approximately $6 million of the
planned project capital for 2016 was not incurred during the year
and a majority of that amount has subsequently been included in the
2017 expansion capital guidance.
- Mill head grade for the quarter was 9.31 g/t gold, an increase
over the prior two quarters, primarily due to the increased
contribution of higher-grade development ore from the third mining
horizon and a positive grade reconciliation of 10% (mined vs.
December 31, 2015 Mineral
Reserves).
- During the quarter, Richmont received the required permit
amendments that allow for an ore mining and processing rate
increase to an average of 1,100 tonnes per day as contemplated in
the Expansion Case PEA that is currently under review.
Beaufor Mine Highlights
BEAUFOR
MINE
|
Quarter
ended
Dec. 31,
2016
|
Quarter
ended
Dec. 31,
2015
|
Year
ended
Dec. 31,
2016
|
Year
ended
Dec. 31,
2015
|
Gold produced
(oz)
|
5,419
|
5,652
|
19,562
|
26,411
|
Gold sold
(oz)
|
5,337
|
5,237
|
19,216
|
26,875
|
Cash costs per ounce
($)(1)
|
1,480
|
1,081
|
1,444
|
991
|
AISC per ounce
($)(1)
|
1,904
|
1,512
|
1,854
|
1,212
|
Realized gold price
per ounce ($)
|
1,577
|
1,467
|
1,647
|
1,474
|
Cash costs per ounce
(US$)(1)
|
1,110
|
810
|
1,090
|
775
|
AISC per ounce
(US$)(1)
|
1,428
|
1,133
|
1,399
|
948
|
Realized gold price
per ounce (US$)
|
1,182
|
1,099
|
1,243
|
1,153
|
Underground
tpd
|
302
|
306
|
298
|
343
|
Mill
tonnes
|
27,988
|
28,345
|
113,013
|
125,447
|
Head grade (g/t
gold)
|
6.16
|
6.30
|
5.50
|
6.64
|
Recoveries
(%)
|
97.8
|
98.4
|
98.0
|
98.6
|
Sustaining costs
($000's)
|
2,260
|
2,259
|
7,871
|
5,942
|
Sustaining costs
(US$000's)
|
1,694
|
1,692
|
5,941
|
4,647
|
(1)
|
Non-IFRS performance
measure. Refer to the Non-IFRS performance measures section
contained in the 2016 Management's Discussion and
Analysis.
|
- Production for the quarter increased over prior quarters to
5,419 ounces of gold (5,337 ounces sold) at cash costs of
$1,480 per ounce (US$1,110 per ounce) and AISC of $1,904 per ounce (US$1,428 per ounce). Underground productivity
increased over the prior two quarters to an average of 302 tonnes
per day at a higher mill head grade of 6.16 g/t gold (8.78 g/t in
December) as a result of improved mobile equipment availability and
increased stope mining activities in the higher-grade Q Zone. For
2016, the mine produced 19,562 ounces of gold (19,216 ounces sold)
at cash costs of $1,444 per ounce
(US$1,090 per ounce) and AISC of
$1,854 per ounce (US$1,399 per ounce).
- Grades and underground productivity are expected to continue to
increase in future quarters as a greater proportion of stope mining
is planned from the higher grade Q Zone and expanded mobile
equipment capacity and availability continue to be improved.
- Annual production for the Quebec Division, which includes the
Beaufor and Monique Mines, was
20,727 ounces of gold. Cash costs for the year were $1,429 per ounce (US$1,079 per ounce) and AISC were $1,816 per ounce (US$1,371 per ounce), underperforming revised
guidance for the year.
- Mine life at the Beaufor Mine is currently less than two years
(based on reserves) and as a result, the depreciation will be
higher in 2017.
Upcoming News & Events
- Exploration Update (Late Q1 2017)
- Expansion Case PEA (Q2 2017)
- Annual General and Special Meeting of Shareholders
(May 4, 2017)
Financial Statements and Management's Discussion and
Analysis
The financial statements and related Management's Discussion and
Analysis can be found on the Corporation's website at
www.richmont-mines.com or under the Corporation's profile on
www.sedar.com and with the Securities and Exchange Commission at
www.sec.gov/edgar.shtml.
Webcast and Conference Call
Senior management will discuss the 2016 financial results in a
webcast and conference call to be held on Tuesday, February 21, 2017 starting at
8:30 a.m. Eastern Time.
Webcast access:
http://event.on24.com/r.htm?e=1355317&s=1&k=D7D190B298425068E1228B2C3B8F9C62
Telephone access:
- Toll free (Canada & U.S.):
1-888-390-0546
- Toronto local &
International: 1-416-764-8688
A replay will be available until March 7,
2017 by dialing 1-416-764-8677 (Toronto local and international) or
1-888-390-0541 (toll free in Canada and U.S.), using pass code 420436#. The
webcast and presentation slides will be archived on the
Corporation's website at www.richmont-mines.com.
About Richmont Mines Inc.
Richmont Mines currently
produces gold from the Island Gold Mine in Ontario, and the Beaufor Mine in Quebec. The Corporation is also advancing
development of the significant high-grade resource extension at
depth of the Island Gold Mine in Ontario. With 35 years of experience in gold
production, exploration and development, and prudent financial
management, the Corporation is well-positioned to cost-effectively
build its Canadian reserve base and to successfully enter its next
phase of growth.
Forward-Looking Statements
This news release contains
forward-looking statements that include risks and uncertainties.
When used in this news release, the words "estimate", "project",
"anticipate", "expect", "intend", "believe", "hope", "may",
"objective" and similar expressions, as well as "will", "shall" and
other indications of future tense, are intended to identify
forward-looking statements. The forward-looking statements are
based on current expectations and apply only as of the date on
which they were made. Except as may be required by law or
regulation, the Corporation undertakes no obligation and disclaims
any responsibility to publicly update or revise any forward-looking
statements or information, whether as a result of new information,
future events or otherwise.
The factors that could cause actual results to differ materially
from those indicated in such forward-looking statements include,
without limitation, changes in the prevailing price of gold, the
Canadian-United States exchange rate, grade of ore mined and
unforeseen difficulties in mining operations and mine development
that could affect revenue and production costs and future
production. Other factors such as uncertainties regarding
government regulations could also affect the results. Other risks
may be set out in Richmont Mines' Annual Information Form, Annual
Reports and periodic reports. The forward-looking information
contained herein is made as of the date of this news release.
Cautionary note to US investors concerning resource
estimates
Information in this press release is intended to
comply with the requirements of the Toronto Stock Exchange and
applicable Canadian securities legislation, which differ in certain
respects with the rules and regulations promulgated under the
United States Securities Exchange Act of 1934, as amended
("Exchange Act"), as promulgated by the SEC. The requirements
of National Instrument 43-101 – Standards of Disclosure for
Mineral Projects ("NI 43-101") adopted by the Canadian
Securities Administrators differ significantly from the
requirements of the United States Securities and Exchange
Commission (the "SEC").
U.S. Investors are urged to consider the disclosure in our
annual report on Form 20-F, File No. 001-14598, as filed with the
SEC under the Exchange Act, which may be obtained from us (without
cost) or from the SEC's web site: http://sec.gov/edgar.shtml.
National Instrument 43-101
The geological data in
this news release has been reviewed by Mr. Daniel Adam, Geo., Ph.D., Vice-President,
Exploration, an employee of Richmont Mines Inc., and a qualified
person as defined by NI 43-101.
SOURCE Richmont Mines