TORONTO, May 4, 2017 /PRNewswire/ --
Richmont Mines Inc. (TSX: RIC) (NYSE: RIC) ("Richmont" or
the "Corporation") announces operating and financial results for
the three months ended March 31,
2017, driven by solid results from the Island Gold Mine. The
Corporation will host a conference call and webcast on Thursday, May 4, 2017, beginning at 8:30 a.m. Eastern Time (details
below.) (All amounts are in Canadian dollars, unless
otherwise indicated.)
First Quarter Highlights
- Company-wide production of 29,401 ounces of gold (28,528 ounces
sold), primarily driven by solid production from the Island Gold
Mine of 23,772 ounces of gold (22,649 ounces sold).
- Company-wide cash
costs[1] of $791 (US$598) per
ounce, positively impacted by low cash costs of $668 (US$504) per
ounce from the Island Gold Mine.
- Company-wide
All-In-Sustaining-Costs[1] ("AISC")
of $1,124 (US$849) per ounce, positively impacted by low
AISC of $848 (US$640) per ounce from the Island Gold
Mine.
- Richmont reported first quarter revenues of $46.5 (US$35.1)
million.
- Earnings of $5.5 (US$4.1) million, or $0.09 (US$0.07) per
share.
- Operating cash
flow[1] (before non-cash
changes in working capital) was $16.4
(US$12.4) million, or $0.26 (US$0.20) per
share.
- Richmont maintained a strong cash balance of $75.2 (US$56.5)
million, in line with the prior quarter; working capital
increased to $66.3 (US$49.7) million.
- Effective March 15, 2017,
Richmont appointed Mr. Robert J.
Chausse as Chief Financial Officer, further strengthening
the senior management team.
"We started the year with a solid quarter reported from both
assets, particularly at our cornerstone Island Gold Mine. The
ongoing transformation of the Island Gold Mine continues to advance
and we remain on schedule to release our Expansion Case Preliminary
Economic Assessment ("Expansion Case PEA") in the second quarter,
which will support our overall objective of positioning the Island
Gold Mine as one of the lowest cost underground gold producers in
the Americas," stated Renaud Adams,
CEO. He continued, "Our focus remains on creating sustainable
shareholder value through enhancing operational and cost
efficiencies throughout the organization while maintaining our
disciplined approach to capital allocation. Over the balance of the
year, 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."
[1] Non-IFRS performance measure. Refer to the Non-IFRS Performance Measures section contained in the Q1 2017 Management's Discussion and Analysis.
Financial Highlights
Quarter ended Quarter ended
(in thousands of $, except per share
amounts) March 31, 2017 March 31, 2016
Revenue from mining operations 46,462 52,634
Net earnings per share, basic 0.09 0.15
Operating cash flow, per share[1] 0.20 0.30
Operating cash flow (before non-cash changes
in working capital), per share[1] 0.26 0.36
Net free cash flow, per share[1] 0.01 0.02
Revenue from mining operations (US$) 35,097 38,329
Net earnings per share, basic (US$) 0.07 0.11
Operating cash flow, per share[1] (US$) 0.15 0.22
Operating cash flow (before non-cash changes
in working capital), per share[1](US$) 0.20 0.26
Net free cash flow, per share[1](US$) 0.01 0.01
[1] Non-IFRS performance measure. Refer to the Non-IFRS performance measures section contained in the Q1 2017 Management's Discussion and Analysis.
Operational Highlights
Quarter ended Quarter ended
March 31, 2017 March 31, 2016
Gold produced (oz) 29,401 32,369
Gold sold (oz) 28,528 32,239
Average cash costs per ounce ($)[1] 791 800
Average AISC per ounce ($)[1] 1,124 1,094
Average realized gold price per ounce ($) 1,624 1,629
Average cash costs per ounce (US$)[1] 598 583
Average AISC per ounce (US$)[1] 849 797
Average realized gold price per ounce (US$) 1,227 1,186
[1] Non-IFRS performance measure. Refer to the Non-IFRS performance measures section contained in the Q1 2017 Management's Discussion and Analysis.
Island Gold Mine Highlights
Quarter ended Quarter ended
Island Gold MINE March 31, 2017 March 31, 2016
Gold produced (oz) 23,772 26,589
Gold sold (oz) 22,649 26,031
Cash costs per ounce ($)[1] 668 667
AISC per ounce ($)[1] 848 848
Realized gold price per ounce ($) 1,624 1,628
Cash costs per ounce (US$)[1] 504 486
AISC per ounce (US$)[1] 640 618
Realized gold price per ounce (US$) 1,227 1,186
Underground tpd 1,019 853
Mill tonnes 83,365 75,906
Mill tpd 926 834
Head grade (g/t gold) 9.18 11.31
Recoveries (%) 96.7 96.3
Sustaining costs ($000's) 4,072 4,713
Project costs ($000's) 5,929 6,987
Non-sustaining exploration ($000's) 3,762 3,770
Sustaining costs (US$000's) 3,076 3,432
Project costs (US$000's) 4,479 5,088
Non-sustaining exploration (US$000's) 2,842 2,745
[1] Non-IFRS performance measure. Refer to the Non-IFRS performance measures section contained in the Q1 2017 Management's Discussion and Analysis.
Island Gold Mine Highlights
- Production for the quarter was 23,772 ounces of gold (22,649
ounces sold). The mine is now well positioned to achieve the
high-end of production guidance for the year of 87,000-93,000
ounces.
- Cash costs for the quarter were $668 (US$504) per
ounce, below guidance for the year. The operating unit costs for
the quarter were $181 (US$137) per tonne milled, in line with the 2017
mine plan.
- AISC for the quarter were $848
(US$640) per ounce, below guidance
for the year.
- For the quarter, expansion capital was $5.9 (US$4.5)
million and exploration expense was $3.8 (US$2.8)
million.
- Mill head grade for the quarter was 9.18 g/t gold, representing
an in line grade reconciliation (mined vs. December 31, 2016 Mineral Reserves) for the
quarter. The 2017 mine plan continues to forecast an average mill
head grade for the year of approximately 8.90 g/t gold.
- Underground mining and milling productivities for the quarter,
averaged a record 1,019 and 926 tonnes per day, respectively, with
lower-grade underground ore stockpiled for future processing,
resulting in an improved overall mill head grade for the
quarter.
- During the quarter, long-hole stope mining continued in the
first and second mining horizons and development in ore was
advanced as planned in the higher-grade third mining horizon.
Stoping in the third mining horizon is expected to begin in the
fourth quarter.
- The development of the main ramp reached a vertical depth of
860 metres at the end of the quarter, which is in line with the
2017 development plan and as contemplated in the upcoming Expansion
Case PEA.
- Mineral Reserves (as at December 31,
2016) at the 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% to 995,700 ounces of
gold at an increased grade of 10.18 g/t, and at an average
discovery cost of less than $35
(US$26) per ounce. (see press
release dated January 31, 2017 and
the technical report titled "Technical Report on the Mineral
Reserve and Resource Estimate as of December
31, 2016 for the Island Gold Mine" dated March 17, 2017).
- New high-grade mineralization located, approximately 800 metres
east of the main Island Gold deposit, was identified by recent
exploration drilling. Hole GD-640-05 intersected 20.6 g/t gold over
11.3 metres (core length), demonstrating significant potential for
near-term and continued resource growth. Additionally, early
results from delineation drilling completed within the Expansion
Case PEA area, indicates the significant potential to further
expand our reserves at higher than current average grades. (see
press release dated March 30,
2017).
- Expansion Case PEA: The Corporation is well
advanced to release the results of the Expansion Case PEA during
the second quarter, as previously disclosed. The study considers
the most cost and capital effective strategy to mine the portion of
the mineral resources that is located within the main area of
interest over four mining horizons, to a maximum depth of 1,000
metres below surface, using the current mine infrastructure. The
Corporation remains focused on transforming the high-grade Island
Gold Mine into one of the lowest cost underground gold producers in
the Americas. Recent achievements include:
- The integration of the December 31,
2016 Mineral Reserves and Resources into the 1,100 tonnes
per day mine plan has been completed.
- The required permit amendments that allow for an ore mining and
processing increase to 1,100 tonnes per day were received in
December.
- Accelerated development of the underground ramp system has
advanced as planned.
- Engineering and identification of the main equipment required
for the mill expansion is well underway and expected capital
requirements for the expanded milling capacity remains below the
$15.0 million, as previously
disclosed.
- The 2017 mine plan and the Expansion Case PEA are focused on
optimizing cash flow generation that would fully fund current and
future production as well as all strategic exploration
programs.
Beaufor Mine Highlights
Quarter ended Quarter ended
Beaufor MINE March 31, 2017 March 31, 2016
Gold produced (oz) 5,629 4,615
Gold sold (oz) 5,879 5,037
Cash costs per ounce ($)[1] 1,265 1,396
AISC per ounce ($)[1] 1,580 1,728
Realized gold price per ounce ($) 1,625 1,648
Cash costs per ounce (US$)[1] 956 1,017
AISC per ounce (US$)[1] 1,194 1,259
Realized gold price per ounce (US$) 1,228 1,200
Underground tpd 354 323
Mill tonnes 30,009 29,318
Head grade (g/t gold) 6.00 4.96
Recoveries (%) 97.2 98.7
Sustaining costs ($000's) 1,854 1,674
Non-sustaining exploration costs ($000's) 140 -
Sustaining costs (US$000's) 1,401 1,219
Non-sustaining exploration costs (US$000's) 106 -
[1] Non-IFRS performance measure. Refer to the Non-IFRS performance measures section contained in the Q1 2017 Management's Discussion and Analysis.
Beaufor Mine Highlights
- Production for the quarter was 5,629 ounces of gold (5,879
ounces sold), in line with previously disclosed plans to ramp-up
production and achieve increased production in the second half of
the year.
- Cash costs of $1,265 (US$956) per ounce achieved during the quarter,
in line with 2017 plans to return the mine to free cash flow
generation status in the first half of the year.
- AISC for the quarter were $1,580
(US$1,194) per ounce.
- Exploration expense was $0.3
(US$0.2) million for the
quarter.
- Underground productivity increased to 354 tonnes per day (403
tonnes per day in March). During the quarter, the majority of the
mining activities were transitioned into the new Q Zone and
additional haulage and mucking mobile equipment were commissioned.
Underground productivity and operating costs are expected to
continue to improve over the balance of the year.
- The Corporation is also considering other strategic
alternatives regarding the Beaufor Mine and Camflo Mill.
Annual and Special Meeting of Shareholders
Richmont's annual and special meeting of shareholders will be
held on Thursday, May 4, 2017 at
10:30 a.m. E.T. at the St. Andrew's
Club & Conference Centre (27th Floor, Caledonia Room) at 150
King Street West in Toronto.
Upcoming News
- Annual and Special Meeting of Shareholders (May 4)
- Expansion Case PEA Results (Q2 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 http://www.richmont-mines.com or under the
Corporation's profile on http://www.sedar.com and with
the Securities and Exchange Commission
at http://www.sec.gov/edgar.shtml.
2017 First Quarter Results Webcast and Conference
Call
Senior management will discuss the first quarter financial
results in a webcast and conference call to be held on Thursday, May 4, 2017 starting at 8:30 a.m. E.T.
Webcast access:
http://event.on24.com/r.htm?e=1405031&s=1&k=2945B7DDFBDA291E4DB85CDEFA27826D
Telephone access:
- Toll free (Canada & U.S.):
1-888-390-0546
- Toronto local &
International: 1-416-764-8688
A replay will be available until May 18,
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 134044#. The
webcast and presentation slides will be archived on the
Corporation's website at http://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
changes in the prevailing price of gold, the Canadian-United States
exchange rate, grade of ore mined and unforeseen difficulties in
mining operations that could affect revenue and production costs.
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 40-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 scientific or technical information 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.
Contact:
Renaud Adams
President and CEO
Phone: 416-368-0291 ext. 101
Anne Day
Senior Vice-President, Investor Relations
Phone: 416-368-0291 ext. 105