UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE
13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of February 2022.
Commission File Number 001-31722
New Gold Inc.
Suite 3320 - 181 Bay Street
Toronto, Ontario M5J 2T3
Canada
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F.
Form 20-F ☐ Form
40-F ☒
Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Note: Regulation S-T Rule 101(b)(1) only permits the submission
in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(7): ☐
Note: Regulation S-T Rule 101(b)(7) only permits the submission
in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and
make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s
“home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as
long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s
security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing
on EDGAR.
DOCUMENTS FILED AS PART OF THIS FORM 6-K
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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NEW GOLD INC. |
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By: |
/s/ Sean Keating |
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| Date: February 23, 2022 |
|
Sean Keating |
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|
Vice President, General Counsel and Corporate Secretary |
Exhibit 99.1
New Gold Reports Fourth Quarter And Full Year
2021 Results; Provides 2022 Operational Outlook And Updated Mineral Reserves And Mineral Resources
Achieves 2021 Updated Consolidated
Guidance; Rainy River Mine Converts 569,000 Underground Gold Ounces to Mineral Reserves
(All amounts are in U.S. dollars
unless otherwise indicated)
TORONTO, Feb. 23, 2022 /CNW/ - February 23, 2022
- New Gold Inc. ("New Gold" or the "Company") (TSX: NGD) (NYSE American: NGD) reports fourth quarter
and full year 2021 results, updates Mineral Reserves and Mineral Resources for the Company as of December 31, 2021, and provides its 2022
operational outlook. The Company will host a conference call and webcast today at 8:30 am Eastern Time to discuss these items (details
are provided at the end of this news release). For detailed information, please refer to the Company's Management's Discussion and Analysis
("MD&A") and consolidated financial statements for the year ended December 31, 2021 that are available on the Company's
website at www.newgold.com and on SEDAR at www.sedar.com. The Company uses certain non-GAAP financial performance measures throughout
this news release. Please refer to the "Non-GAAP Financial Performance Measures" section of this news release and the MD&A
for more information. Numbered note references throughout this news release are to endnotes which can be found at the end of this news
release.
Consolidated Fourth Quarter and Full Year Highlights
| • | Total production for the fourth quarter was 111,574 gold
equivalent1 ("gold eq.") ounces (81,072 ounces of gold, 214,030 ounces of silver and 14.2 million pounds of copper).
For the year, production was 418,933 gold eq.1 ounces (286,921 ounces of gold, 867,961 ounces of silver and 61.7 million pounds
of copper). The Company achieved the updated consolidated gold equivalent guidance range. |
| • | Operating expenses for the quarter were $912 per gold eq.
ounce and $938 per gold eq. ounce for the year. |
| • | Total cash costs2 for the quarter were $965 per
gold eq. ounce and $991 per gold eq. ounce for the year, achieving the updated annual guidance range of $960 to $1,030 per gold eq. ounce.
|
| • | All-in sustaining costs2 for the quarter were
$1,355 per gold eq. ounce and $1,463 per gold eq. ounce for the year, achieving the updated annual guidance range of $1,415 to $1,495
per gold eq. ounce. |
| • | Average realized gold price2 was $1,798 per ounce
and average realized copper price2 was $4.37 per pound for the quarter. For the year, average realized gold price2
was $1,798 per ounce and average realized copper price2 was $4.24 per pound. |
| • | Cash generated from operations for the quarter was $106 million
($0.16 per share) and $324 million ($0.48 per share) for the year. Cash generated from operations for the quarter, before changes in non-cash
operating working capital2, was $93 million ($0.14 per share) and $323 million ($0.47 per share) for the year. |
| • | Net earnings for the quarter were $151 million ($0.22 per
share), and $141 million ($0.21 per share) for the year. |
| • | Adjusted net earnings2 for the quarter were $25
million ($0.04 per share) and $83 million ($0.12 per share) for the year. |
| • | During the quarter, the Company closed the previously announced
sale of the Blackwater gold stream to Wheaton Precious Metals Corp. for $300 million (refer to the Company's December 13, 2021
and December 22, 2021 press releases). |
| • | During the quarter, the Company amended its secured credit
facility, extending the maturity date to December 2025 from October 2023 and increasing the maximum borrowing limit to $400 million from
$350 million. |
| • | 2021 year-end Mineral Reserves of 3.7 million ounces of gold;
Rainy River underground conversion fully offsets 2021 gold ounce depletion. |
| • | At the end of the quarter, the Company had a cash position
of $482 million and a strong liquidity position of $857 million. |
"While we had to navigate challenges throughout
2021, I am extremely proud of our resilient team and the way we ended the year," stated Renaud Adams, President & CEO. "The
fourth quarter delivered our strongest production quarter of the year, allowing us to meet our updated guidance. It was also our lowest
quarter from a cost perspective, leading to our highest free cash flow quarter of the year. Adding to that, we exited the year on a strong
note with the sale of the Blackwater gold stream. The value we have been able to crystallize through multiple Blackwater-related transactions
since August 2020 has positioned our Company with a peer-leading balance sheet and the financial strength to execute on our strategy."
"Looking to 2022, our strategy remains focused
on operational excellence and optimization at both assets. At Rainy River, we converted meaningful underground Mineral Resources to Mineral
Reserves resulting in a net increase to total gold reserves for New Gold. We continue to seek ways to further optimize the operation and
reduce costs while we advance the development of the Intrepid underground zone, targeting initial production in the second half of the
year. At New Afton, our priorities remain on advancing the B3 ramp-up and C-Zone development, exhausting the Lift 1 cave, including the
recovery level zone, and completing commissioning of the in-pit tailings," added Mr. Adams.
Consolidated Financial Highlights
| |
Q4 2021 |
Q4 2020 |
FY 2021 |
FY 2020 |
| Revenue ($M) |
202.6 |
198.9 |
745.5 |
643.4 |
| Operating expenses ($M) |
99.6 |
97.3 |
377.3 |
339.9 |
| Net earnings (loss), per share ($) |
0.22 |
(0.03) |
0.21 |
(0.12) |
| Adj. net earnings, per share ($)2 |
0.04 |
0.04 |
0.12 |
0.03 |
| Operating cash flow, per share ($) |
0.16 |
0.15 |
0.48 |
0.44 |
| Cash generated from operations, before changes in non-cash operating working capital, per share ($)2 |
0.14 |
0.14 |
0.47 |
0.41 |
| • | Revenues for the quarter were $203 million and $745 million
for the year ended December 31, 2021, an increase compared to the prior-year periods due to higher gold and copper prices, partially offset
by lower sales volume. |
| • | Operating expenses for the quarter and year ended December
31, 2021, were higher than the prior-year periods due to the strengthening of the Canadian dollar relative to the U.S. dollar and the
prior year benefitting from the wage subsidy. |
| • | Net earnings for the quarter were $151 million ($0.22 per
share) compared to a net loss for the prior-year period of $21 million ($0.03 per share). Net earnings for the year ended December 31,
2021, were $141 million ($0.21 per share) compared to a net loss for the prior year of $79 million ($0.12 per share). The increase in
net earnings compared to the prior-year periods were primarily due to higher revenue, the gain on the sale of the Blackwater gold stream
to Wheaton Precious Metals Corp., and lower finance costs, partially offset by an increase in operating expenses and an unrealized loss
on the revaluation of certain investments. |
| • | Adjusted net earnings2 for the quarter were $25
million ($0.04 per share), a decrease compared to the prior-year period primarily due to higher adjusted tax expense2. Adjusted
net earnings2 for the year ended December 31, 2021, were $83 million ($0.12 per share), an increase compared to the prior year
primarily due to higher revenue less cost of goods sold and lower finance costs. |
Consolidated Operational Highlights
| |
Q4 2021 |
Q4 2020 |
FY 2021 |
FY 2020 |
| Gold eq. production (ounces)1 |
111,574 |
120,567 |
418,933 |
437,617 |
| Gold eq. sold (ounces)1 |
109,214 |
122,139 |
402,449 |
428,370 |
| Gold production (ounces) |
81,072 |
83,096 |
286,921 |
293,139 |
| Gold sold (ounces) |
78,745 |
86,491 |
277,451 |
291,877 |
| Copper production (Mlbs) |
14.2 |
18.5 |
61.7 |
72.1 |
| Copper sold (MIbs) |
14.2 |
17.5 |
58.4 |
68.0 |
| Gold revenue, per ounce |
1,778 |
1,606 |
1,778 |
1,537 |
| Copper revenue, per pound |
4.07 |
3.14 |
3.97 |
2.67 |
| Average realized gold price, per ounce2 |
1,798 |
1,623 |
1,798 |
1,559 |
| Average realized copper price, per pound2 |
4.37 |
3.34 |
4.24 |
2.86 |
| Operating expenses, per gold eq. ounce |
912 |
799 |
938 |
794 |
| Total cash costs, per gold eq. ounce2 |
965 |
841 |
991 |
840 |
| Depreciation and depletion, per gold eq. ounce |
469 |
419 |
489 |
454 |
| All-in sustaining costs, per gold eq. ounce2 |
1,355 |
1,491 |
1,463 |
1,389 |
| Sustaining capital and sustaining leases ($M)2 |
33.6 |
69.2 |
156.8 |
205.5 |
| Growth capital ($M)2 |
26.9 |
42.7 |
101.7 |
89.4 |
| Total capital and leases ($M) |
60.5 |
111.9 |
258.5 |
294.9 |
Rainy River
Operational Highlights
| Rainy River Mine |
Q4 2021 |
Q4 2020 |
FY 2021 |
FY 2020 |
| Gold eq. production (ounces)1 |
70,500 |
68,241 |
242,961 |
233,201 |
| Gold eq. sold (ounces)1 |
68,380 |
72,279 |
237,061 |
235,416 |
| Gold production (ounces) |
68,356 |
66,734 |
234,469 |
228,919 |
| Gold sold (ounces) |
66,239 |
70,675 |
228,693 |
231,112 |
| Gold revenue, per ounce |
1,796 |
1,624 |
1,797 |
1,561 |
| Average realized gold price, per ounce2 |
1,796 |
1,624 |
1,797 |
1,561 |
| Operating expenses, per gold eq. ounce |
897 |
864 |
955 |
906 |
| Total cash costs, per gold eq. ounce2 |
897 |
864 |
955 |
906 |
| Depreciation and depletion, per gold eq. ounce |
571 |
523 |
625 |
600 |
| All-in sustaining costs, per gold eq. ounce2 |
1,281 |
1,494 |
1,415 |
1,562 |
| Sustaining capital and sustaining leases ($M)2 |
24.0 |
43.6 |
100.9 |
147.5 |
| Growth capital ($M)2 |
2.3 |
2.8 |
11.6 |
3.1 |
| Total capital and leases ($M) |
26.3 |
46.5 |
112.5 |
150.6 |
Operating Key Performance Indicators
| Rainy River Mine (Open Pit Mine only) |
Q1 2021 |
Q2 2021 |
Q3 2021 |
Q4 2021 |
| Tonnes mined per day (ore and waste) |
150,767 |
158,556 |
149,630 |
129,775 |
| Ore tonnes mined per day |
35,681 |
36,256 |
52,917 |
33,885 |
| Operating waste tonnes per day |
65,643 |
71,124 |
88,216 |
62,348 |
| Capitalized waste tonnes per day |
49,442 |
51,176 |
8,497 |
33,542 |
| Total waste tonnes per day |
115,085 |
122,300 |
96,713 |
95,890 |
| Strip ratio (waste:ore) |
3.23 |
3.37 |
1.83 |
2.83 |
| Tonnes milled per calendar day |
26,301 |
25,349 |
25,245 |
24,492 |
| Gold grade milled (g/t) |
0.80 |
0.82 |
0.89 |
1.03 |
| Gold recovery (%) |
89 |
87 |
89 |
92 |
| Mill availability (%) |
89 |
88 |
91 |
94 |
| Gold production (ounces) |
54,656 |
52,901 |
58,557 |
68,356 |
| Gold eq. production (ounces)1 |
56,513 |
55,163 |
60,785 |
70,500 |
| • | Fourth quarter gold eq.1 production was 70,500
ounces (68,356 ounces of gold and 154,364 ounces of silver), an increase compared to the prior-year period due to higher gold grade and
gold recovery, partially offset by lower tonnes processed. For the year ended December 31, 2021, gold eq.1 production was 242,961
ounces (guidance of 240,000 to 255,000 gold eq.1 ounces) consisting of 234,469 ounces of gold (guidance of 235,000 to 250,000
ounces) and 611,433 ounces of silver. The increase over the prior year was due to higher tonnes processed, with the prior year including
a two-week voluntary shutdown due to COVID-19. The Rainy River Mine achieved the low end of the updated gold equivalent guidance range.
|
| • | Operating expenses and total cash costs2 were
$897 per gold eq. ounce for the quarter, an increase over the prior-year period due to lower sales volumes and the strengthening of the
Canadian dollar relative to the U.S. dollar. The strengthening of the Canadian dollar increased costs by $29 per gold eq. ounce in the
quarter. For the year ended December 31, 2021, operating expenses and total cash costs2 were $955 per gold eq. ounce, achieving
the updated annual guidance range of $925 to $985 per gold eq. ounce. The increase over the prior year was due to the strengthening of
the Canadian dollar relative to the U.S. dollar, and the receipt of the wage subsidy in the prior year. |
| • | All-in sustaining costs2 were $1,281 per gold
eq. ounce for the quarter, a decrease over the prior-year period primarily due to lower sustaining capital spend, partially offset by
lower sales volumes. For the year ended December 31, 2021, all-in sustaining costs2 were $1,415 per gold eq. ounce, achieving
the updated annual guidance range of $1,365 to $1,440 per gold eq. ounce. The decrease over the prior year was primarily due to higher
sales volumes and lower sustaining capital spend. |
| • | Total capital and leases for the quarter were $26 million,
including $24 million related to sustaining capital and sustaining lease2 payments, including $11 million of capitalized mining
costs, and $2 million related to growth capital2. Sustaining capital spend during the quarter primarily included the advancement
of the annual tailings dam raise. Growth capital during the quarter was related to the development of the Intrepid underground zone which
advanced 298 metres. For the year ended December 31, 2021, total capital and leases were $113 million, including $101 million related
to sustaining capital and sustaining lease2 payments, including $40 million of capitalized mining costs, and $12 million related
to growth capital2. |
| • | Free cash flow2 for the quarter was $36 million,
and for the year ended December 31, 2021 was $46 million (net of a $27 million stream payment). The increase over the prior-year periods
was due to an increase in revenue from higher metal prices and lower capital spend. |
| • | The open pit mine averaged 129,775 tonnes per day during
the quarter, a decrease compared to the prior-year period primarily due to lower drill utilization. Approximately 3.1 million ore tonnes
and 8.8 million waste tonnes (including 3.1 million capitalized waste tonnes) were mined from the open pit at an average strip ratio of
2.83:1. For the year, the average strip ratio was 2.7:1, in-line with the 2021 plan. |
| • | The mill averaged 24,492 tonnes per day during the quarter,
a decrease compared to the prior-year period primarily due to harder ore encountered from the 433 zone. The mill processed an average
grade of 1.03 grams per tonne at a gold recovery of 92%. Mill availability for the quarter averaged 94%, despite a 3-day mill shutdown
that was moved from early-2022 to December. |
New Afton Mine
Operational Highlights
| New Afton Mine |
Q4 2021 |
Q4 2020 |
FY 2021 |
FY 2020 |
| Gold eq. production (ounces)1 |
41,074 |
52,326 |
175,972 |
204,416 |
| Gold eq. sold (ounces)1 |
40,835 |
49,860 |
165,387 |
192,953 |
| Gold production (ounces) |
12,716 |
16,362 |
52,452 |
64,220 |
| Gold sold (ounces) |
12,507 |
15,817 |
48,758 |
60,765 |
| Copper production (Mlbs) |
14.2 |
18.5 |
61.7 |
72.1 |
| Copper sold (Mlbs) |
14.2 |
17.5 |
58.4 |
68.0 |
| Gold revenue, per ounce |
1,685 |
1,525 |
1,690 |
1,449 |
| Copper revenue, per pound |
4.07 |
3.14 |
3.97 |
2.67 |
| Average realized gold price, per ounce2 |
1,807 |
1,621 |
1,804 |
1,553 |
| Average realized copper price, per pound2 |
4.37 |
3.34 |
4.24 |
2.86 |
| Operating expenses, per gold eq. ounce |
938 |
706 |
912 |
657 |
| Total cash costs, per gold eq. ounce2 |
1,079 |
808 |
1,042 |
759 |
| Depreciation and depletion, per gold eq. ounce |
297 |
260 |
288 |
268 |
| All-in sustaining costs, per gold eq. ounce2 |
1,330 |
1,330 |
1,385 |
1,064 |
| Sustaining capital and sustaining leases ($M)2 |
9.5 |
25.5 |
54.5 |
57.4 |
| Growth capital ($M)2 |
24.6 |
39.9 |
90.1 |
77.1 |
| Total capital and leases ($M) |
34.1 |
65.4 |
144.6 |
134.5 |
Operating Key Performance Indicators
| New Afton Mine |
Q1 2021 |
Q2 2021 |
Q3 2021 |
Q4 2021 |
| Tonnes mined per day (ore and waste) |
11,395 |
15,104 |
12,861 |
13,705 |
| Tonnes milled per calendar day |
13,564 |
13,795 |
13,068 |
13,125 |
| Gold grade milled (g/t) |
0.39 |
0.43 |
0.43 |
0.41 |
| Gold recovery (%) |
79 |
80 |
83 |
81 |
| Gold production (ounces) |
11,994 |
14,088 |
13,653 |
12,716 |
| Copper grade milled (%) |
0.64 |
0.79 |
0.72 |
0.67 |
| Copper recovery (%) |
80 |
83 |
82 |
80 |
| Copper production (Mlbs) |
13.8 |
18.2 |
15.6 |
14.2 |
| Mill availability (%) |
96 |
98 |
98 |
97 |
| Gold eq. production (ounces)1 |
39,512 |
50,542 |
44,843 |
41,074 |
| • | Fourth quarter gold eq.1 production was 41,074
ounces, consisting of 12,716 ounces of gold and 14.2 million pounds of copper. For the year ended December 31, 2021, gold eq.1
production was 175,972 ounces (guidance of 165,000 to 195,000 gold eq.1 ounces), consisting of 52,452 ounces of gold (guidance
of 52,000 to 62,000 ounces) and 61.7 million pounds of copper (guidance of 56 to 66 million pounds), achieving the gold equivalent guidance
range for the year. The decrease over the prior-year periods was due to lower tonnes processed. |
| • | Operating expenses and total cash costs2 were
$938 and $1,079 per gold eq. ounce for the quarter, an increase over the prior-year period primarily due to lower sales volumes, and the
strengthening of the Canadian dollar relative to the U.S. dollar. The strengthening of the Canadian dollar increased costs by $31 per
gold eq. ounce in the quarter. For the year ended December 31, 2021, operating expenses and total cash costs2 were $912 and
$1,042 per gold eq. ounce, slightly above the annual total cash cost guidance range of $930 to $1,010 per gold eq. ounce. The increase
over the prior year was due to lower sales volumes, the strengthening of the Canadian dollar relative to the U.S. dollar, and the receipt
of the wage subsidy in the prior year. |
| • | All-in sustaining costs2 were $1,330 per gold
eq. ounce for the quarter, in-line with the prior-year period. For the year ended December 31, 2021, all-in sustaining costs2
were $1,385 per gold eq. ounce, slightly above the annual guidance range of $1,225 to $1,325 per gold eq. ounce. The increase over the
prior year was due to lower sales volumes and higher total cash costs, partially offset by lower sustaining capital spend. |
| • | Total capital and leases for the quarter were $34 million,
including $9 million related to sustaining capital and sustaining lease2 payments and $25 million related to growth capital2.
Sustaining capital spend during the quarter primarily related to B3 mine development and the advancement of the planned tailings dam raise.
Growth capital during the quarter primarily related to C-Zone development and the thickened and amended tailings project. For the year
ended December 31, 2021, total capital and leases were $145 million, including $55 million related to sustaining capital and sustaining
lease2 payments and $90 million related to growth capital2. |
| • | Free cash flow2 for the quarter was $10 million,
an increase over the prior-year period due to lower capital spend. For the year ended December 31, 2021, free cash flow2 was
$16 million, an increase over the prior year due to an increase in revenue from higher metal prices. |
| • | C-Zone development advanced by approximately 1,028 metres
in the quarter. Mine infrastructure also advanced with the installation of conveyors and work initiated on a secondary crushing station.
The project continues to advance on plan, with production expected to begin in the second half of 2023. |
| • | The underground mine averaged 13,705 tonnes per day during
the quarter as the mine prepares for the completion of Lift 1 mining activities and continues the progressive ramp-up of the B3 zone.
|
| • | The mill averaged 13,125 tonnes per day during the quarter,
below the prior-year period, but in-line with mining rates. The mill processed gold grades of 0.41 grams per tonne and copper grades of
0.67%, with gold and copper recoveries of 81% and 80%, respectively. |
2022 Operational Outlook
| Operational Estimates |
Rainy River Mine |
New Afton Mine |
2022 Consolidated Guidance |
| Gold eq. production (ounces)3 |
265,000 - 295,000 |
115,000 - 145,000 |
380,000 - 440,000 |
| Gold production (ounces) |
260,000 - 290,000 |
35,000 - 45,000 |
295,000 - 335,000 |
| Copper production (Mlbs) |
- |
35 - 45 |
35 - 45 |
| Operating expenses, per gold eq. ounce |
$730 - $810 |
$1,100 - $1,180 |
$840 - $920 |
| All-in sustaining costs, per gold eq. ounce2 |
$1,270 - $1,370 |
$1,695 - $1,795 |
$1,470 - $1,570 |
| Capital Investment & Exploration Estimates |
Rainy River Mine |
New Afton Mine |
2022 Consolidated Guidance |
| Sustaining capital and sustaining leases ($M)2 |
$125 - $155 |
$55 - $70 |
$180 - $225 |
| Growth capital ($M)2 |
$15 - $25 |
$100 - $130 |
$115 - $155 |
| Total capital and leases ($M) |
$140 - $180 |
$155 - $200 |
$295 - $380 |
| Exploration ($M) |
$5 |
$15 |
$20 |
Gold equivalent3 production is expected
to be between 380,000 to 440,000 ounces, in-line with the prior year. Production is expected to strengthen in the second half of the year,
with the second half of 2022 expected to represent approximately 55% of annual production.
Operating expenses are expected
to be $840 to $920 per gold eq. ounce, lower than the prior year as a higher proportion of gold sales will be from the lower operating
expense per ounce Rainy River Mine. All-in sustaining costs2 are expected to be $1,470 to $1,570 per gold eq. ounce, slightly
higher than the prior year due to higher sustaining capital spend, partially offset by lower operating expenses. All-in sustaining costs2
are expected to trend lower in the second half of the year, consistent with the production profile.
Total capital and leases are
expected to be $295 to $380 million, of which, sustaining capital and sustaining leases2 are expected to be $180 to $225 million,
and growth capital2 is expected to be $115 to $155 million. The increase in sustaining capital and sustaining leases2
over the prior year predominantly relates to capitalized waste, tailings management, and B3 activities. The increase in growth capital2
relates to C-Zone development and advancing underground development at the Intrepid underground zone at Rainy River. Quarterly sustaining
capital is expected to trend lower in the second half of the year, and growth capital is expected to be relatively consistent through
the year.
In 2022, the Company will report
production on a gold equivalent basis as well as on a per-metal basis. Operating expenses and all-in sustaining costs will be reported
on a per gold equivalent ounce basis. Throughout the year, the Company will report gold equivalent ounces using a constant ratio of $1,800
per gold ounce, $24.00 per silver ounce and $4.00 per pound copper, and a foreign exchange rate of $1.25 Canadian dollars to $1.00 US
dollar.
The operational outlook assumes
that the Company's operations will continue without any significant COVID-19-related interruptions. New Gold continues to maintain preventative
measures at all our sites to protect our workforce and communities, and to mitigate the effects of COVID-19 on our operations. Any reduction
or suspension of New Gold's operations due to COVID-19, could impact its ability to achieve 2022 outlook. Please see the Cautionary Note
Regarding Forward-Looking Statements at the end of this news release.
2022 Rainy River Operational
Outlook
| Operational Estimates |
2022 Guidance |
| Gold eq. production (ounces)3 |
265,000 - 295,000 |
| Gold production (ounces) |
260,000 - 290,000 |
| Operating expenses, per gold eq. ounce |
$730 - $810 |
| All-in sustaining costs, per gold eq. ounce2 |
$1,270 - $1,370 |
| Capital Investment & Exploration Estimates |
2022 Guidance |
| Sustaining capital and sustaining leases ($M)2 |
$125 - $155 |
| Growth capital ($M)2 |
$15 - $25 |
| Total capital and leases ($M) |
$140 - $180 |
| Exploration ($M) |
$5 |
| • | Gold equivalent3 production is expected to be
265,000 to 295,000 ounces, an increase over the prior year due to an increase in gold grade, tonnes mined and processed, as well as commencing
ore extraction from the Intrepid underground zone in the second half of the year. Production is expected to strengthen in the second half
of the year as capitalized waste is to be prioritized during the colder weather months, and planned maintenance activities for the processing
plant are to be completed in the first half of the year. The second half of 2022 is expected to represent approximately 55% of the annual
production. |
| • | Ore from the East Lobe is expected to contribute approximately
25% of mill feed in 2022. As a result of bench sequencing and prioritization of pit stripping during winter months, East Lobe contribution
is expected to be higher in the second half of the year. |
| • | Operating expenses are expected to be $730 to $810 per gold
eq. ounce, a decrease over the prior year, primarily due to a higher strip ratio of approximately 3.2:1 expected in 2022, resulting in
a higher proportion of mining costs being capitalized and higher annual production. |
| • | All-in sustaining costs2 are expected to be $1,270
to $1,370 per gold eq. ounce, a decrease over the prior year, primarily due to higher production. All-in sustaining costs2
are expected to trend lower in the second half of the year, consistent with the production profile. |
| • | Total capital and leases are expected to be $140 to $180
million. Sustaining capital and sustaining leases2 are expected to be $125 to $155 million, including approximately $60 million in capitalized
waste, $40 million towards the annual tailings dam raise, $20 million in capital parts and components replacement programs, $10 million
in sustaining capital leases, and $5 million in sustaining capital development for the Intrepid underground zone. Growth capital2 is expected
to be $15 to $25 million, related to the development of the Intrepid underground zone, with initial production targeted for late-2022.
Growth capital is expected to be generally consistent throughout the year. |
| • | Exploration expenditures are expected to be approximately
$5 million and will focus on completing reconnaissance exploration drilling on the North East Trend target and on follow-up drilling based
on previous positive results on priority targets. |
2022 New Afton Operational Outlook
| Operational Estimates |
2022 Guidance |
| Gold eq. production (ounces)3 |
115,000 - 145,000 |
| Gold production (ounces) |
35,000 - 45,000 |
| Copper production (Mlbs) |
35 - 45 |
| Operating expenses, per gold eq. ounce |
$1,100 - $1,180 |
| All-in sustaining costs, per gold eq. ounce2 |
$1,695 - $1,795 |
| Capital Investment & Exploration Estimates |
2022 Guidance |
| Sustaining capital and sustaining leases ($M)2 |
$55 - $70 |
| Growth capital ($M)2 |
$100 - $130 |
| Total capital and leases ($M) |
$155 - $200 |
| Exploration ($M) |
$15 |
| • | Gold equivalent3 production is expected to be
115,000 to 145,000 ounces, lower than the prior year, primarily due to a reduction in B3 ore tonnes to be mined in 2022. The lower tonnes
mined is a result of the previously announced B3 permitting delays experienced in 2021 which impacted the drawpoint development schedule
and slowed the production ramp-up. The B3 mining rate is expected to average approximately 4,000 tonnes per day during drawpoint development,
ramping up to approximately 8,000 tonnes per day in late-2022. As a result of the slower ramp-up, mining from B3 is expected to extend
to 2025 in order to extract all planned tonnes. Current surface stockpiles are expected to supplement the mill feed during the year, with
production expected to be strongest in the first half of 2022. 2022 operational estimates are exclusive of any material from the ore purchase
agreement. |
| • | Operating expenses are expected to be $1,100 to $1,180 per
gold eq. ounce, an increase over the prior year as a result of higher costs related to the B3 ramp-up and lower production. |
| • | All-in sustaining costs2 are expected to be $1,695
to $1,795 per gold eq. ounce, an increase over the prior year, primarily due to higher sustaining capital spend and lower production.
Approximately $310 per gold eq. ounce of the all-in sustaining cost relates to the completion of B3 development. All-in sustaining costs2
are expected to trend higher in the first half of the year due to higher B3 lateral development and tailings management work. |
| • | Total capital and leases are expected to be $155 to $200
million. Sustaining capital and sustaining leases2 are expected to be $55 to $70 million, including approximately $40 million
related to the completion of B3 development, infrastructure and equipment, $5 million related to tailings management and $15 million related
to other general sustaining capital and working capital payments. During 2022, sustaining capital projects will continue to focus on advancing
the development of the B3 zone with approximately 900 metres of development and construction of approximately 46 drawbells. Growth capital2
is expected to be $100 to $130 million, related to the continued advancement of the C-Zone project, primarily focused on mine development
with a total of 5,000 metres planned, infrastructure installation, complete commissioning of the thickened and amended tailings facility
and continued progress on stabilization. Growth capital is expected to be generally consistent throughout the year. |
| • | Exploration expenditures are expected to be approximately
$15 million, and will focus on underground exploration and infill drilling on the mineralized zone defined within the New Afton footprint,
follow-up surface drilling within the Cherry Creek trend, and reconnaissance exploration drilling on regional targets that were defined
in 2021. |
Mineral Reserves and Mineral Resources (as at December
31, 2021)
As at December 31, 2021, New Gold is reporting Mineral
Reserves and Mineral Resources as summarized in the table below. Detailed Mineral Reserve and Mineral Resource tables follow at the end
of this press release.
| Mineral Reserves and Mineral Resources Summary1 |
As at December 31, 20212 |
As at December 31, 2020 |
|
Gold
koz |
Silver
koz |
Copper
Mlbs |
Gold
koz |
Silver
koz |
Copper
Mlbs |
| Proven and Probable Mineral Reserves |
| Rainy River |
2,799 |
7,022 |
- |
2,598 |
7,152 |
- |
| Open Pit |
1,230 |
2,170 |
- |
1,599 |
3,518 |
- |
| Underground |
1,241 |
3,084 |
- |
672 |
1,795 |
- |
| Low grade and stockpile |
328 |
1,768 |
- |
327 |
1,839 |
- |
| New Afton |
883 |
2,327 |
675 |
958 |
2,670 |
758 |
| Total Proven and Probable Mineral Reserves |
3,682 |
9,349 |
675 |
3,556 |
9,822 |
758 |
| Measured and Indicated Mineral Resources (exclusive of Mineral Reserves)1 |
| Rainy River |
1,543 |
3,894 |
- |
2,005 |
5,125 |
- |
| Open Pit |
195 |
472 |
- |
187 |
562 |
- |
| Underground |
1,348 |
3,422 |
- |
1,818 |
4,563 |
- |
| New Afton |
1,174 |
4,187 |
1,006 |
1,182 |
4,246 |
1,003 |
| Total Measured and Indicated Mineral Resources |
2,717 |
8,081 |
1,006 |
3,187 |
9,371 |
1,003 |
| Total Inferred Mineral Resources |
387 |
831 |
137 |
412 |
917 |
143 |
1. Refer to the detailed Mineral Reserve and Mineral Resource tables that follow at the end of this press release for the estimates as at December 31, 2021 and the Company's Annual Information Form dated March 31, 2021 for estimates as at December 31, 2020.
2. The Mineral Reserves and Mineral Resources stated above are as at December 31, 2021 and do not reflect any events subsequent to that date. |
Consolidated gold Mineral Reserves increased by approximately
126,000 gold ounces compared to the prior year. The increase was primarily due to an economic study at the Mineral Reserve gold price
of $1,400 per ounce, that supports the conversion of approximately 569,000 gold ounces of underground Mineral Resources to Mineral Reserves
at the Rainy River Mine. A National Instrument 43-101 ("NI 43-101") Technical Report for the Rainy River Mine will be filed
by March 31, 2022.
| • | At the Rainy River Mine, total Mineral Reserves increased
by approximately 201,000 gold ounces over the prior year due to converting approximately 569,000 underground gold ounces from Mineral
Resources to Mineral Reserves, partially offset by open pit mine depletion. |
| • | Open pit reserve depletion included approximately 262,000
ounces from annual mine depletion, approximately 45,000 ounces related to a resource mineability adjustment and approximately 34,000 ounces
due to grade control model underperformance compared to the resource model (both primarily related to East Lobe), and approximately 28,000
ounces related to an 85% correction factor applied to the remaining ore material from the East Lobe. The correction factor applied was
based on a bench to bench reconciliation study. The East Lobe is expected to be mined out by the end of 2023. |
| • | At the New Afton Mine, Mineral Reserves decreased by approximately
75,000 gold ounces over the prior year due to 69,000 gold ounces of annual mine depletion and 6,000 ounces from mine plan optimization. |
Consolidated Measured and Indicated Mineral Resources
decreased by approximately 470,000 gold ounces, with Rainy River decreasing by 462,000 gold ounces due to conversion of underground Mineral
Resources to Mineral Reserves and New Afton decreasing by approximately 8,000 gold ounces due to conversion of C-Zone Mineral Resources
to Mineral Reserves. Consolidated Inferred Mineral Resources decreased by approximately 25,000 gold ounces to 387,000 gold ounces.
Sustainability and ESG
New Gold has four sustainability focus areas: Indigenous
Peoples, Tailings Management, Water and Climate. New Gold has adapted its sustainability efforts to align with the most pressing environmental,
social and governance ("ESG") issues facing the Company and the mining industry. As such, the Company's ESG approach continues
to prioritize the health, safety, and well-being of its people and the people in the communities in which New Gold operates. The protection
of its people is central to its success as New Gold believes people are its greatest asset. New Gold is committed to providing training,
opportunities, and progression paths for its teams, and it actively seeks to ensure that it promotes diversity within its teams at all
levels of the organization. New Gold has adopted an approach to execute on its sustainability strategy that aligns with ESG reporting
standards.
Fourth Quarter and Full Year 2021 Conference Call
and Webcast
The Company will host a webcast and conference call
today at 8:30 am Eastern Time to discuss the Company's fourth quarter and full year 2021 consolidated results and 2022 operational outlook.
| • | Participants
may listen to the webcast by registering on our website at www.newgold.com or via the following
link https://produceredition.webcasts.com/starthere.jsp?ei=1521870&tp_key=6fecc53dc8
|
| • | Participants may also listen to the conference call by calling
North American toll free 1-888-664-6383, or 1-416-764-8650 outside of the U.S. and Canada, passcode 70681110. |
| • | A recorded playback of the conference call will be available
until March 23, 2022 by calling North American toll free 1-888-390-0541, or 1-416-764-8677 outside of the U.S. and Canada, passcode 681110.
An archived webcast will also be available at www.newgold.com. |
About New Gold
New Gold is a Canadian-focused intermediate mining
Company with a portfolio of two core producing assets in Canada, the Rainy River gold mine and the New Afton copper-gold mine. The Company
also holds a 5% equity stake in Artemis Gold Inc., and other Canadian-focused investments. New Gold's vision is to build a leading diversified
intermediate gold company based in Canada that is committed to environment and social responsibility. For further information on the Company,
visit www.newgold.com.
Endnotes
| 1. |
Total gold eq. ounces include silver and copper produced/sold converted to a gold equivalent. All copper is produced/sold by the New Afton Mine. Gold eq. ounces for Rainy River in Q4 2021 includes production of 154,364 ounces of silver (154,144 ounces sold) converted to a gold eq. based on a ratio of $1,800 per gold ounce and $25.00 per silver ounce used for 2021 guidance estimates. Gold eq. ounces for New Afton in Q4 2021 includes 14.2 million pounds of copper produced (14.2 million pounds sold) and 59,666 ounces of silver produced 55,938 ounces of silver sold) converted to a gold eq. based on a ratio of $1,800 per gold ounce, 3.50 per copper pound and $25.00 per silver ounce used for 2021 guidance estimates. |
| |
|
| 2. |
"Total cash costs", "all-in sustaining costs", "adjusted net earnings/(loss)",, "adjusted tax expense", "sustaining capital and sustaining leases", "growth capital", "cash generated from operations", "free cash flow", and "average realized gold/copper price per ounce/pound" are all non-GAAP financial performance measures that are used in this news release. These measures do not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. For more information about these measures, why they are used by the Company, and a reconciliation to the most directly comparable measure under IFRS, see the "Non-GAAP Financial Performance Measures" section of this news release. |
| |
|
| 3. |
2022 gold equivalent ounces includes approximately 500,000 to 540,000 ounces of silver at Rainy River and 125,000 to 145,000 ounces of silver at New Afton. |
Non-GAAP Financial Performance Measures
Total Cash Costs per Gold eq. Ounce
"Total cash costs per gold equivalent ounce"
is a non-GAAP financial performance measure that is a common financial performance measure in the gold mining industry but does not have
any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers. New Gold reports
total cash costs on a sales basis and not on a production basis. The Company believes that, in addition to conventional measures prepared
in accordance with IFRS, this measure, along with sales, is a key indicator of the Company's ability to generate operating earnings and
cash flow from its mining operations. This measure allows investors to better evaluate corporate performance and the Company's ability
to generate liquidity through operating cash flow to fund future capital exploration and working capital needs.
This measure is intended to provide additional information
only and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. This measure
is not necessarily indicative of cash generated from operations under IFRS or operating costs presented under IFRS.
Total cash cost figures are calculated in accordance
with a standard developed by The Gold Institute, a worldwide association of suppliers of gold and gold products that ceased operations
in 2002. Adoption of the standard is voluntary and the cost measures presented may not be comparable to other similarly titled measures
of other companies. Total cash costs include mine site operating costs such as mining, processing and administration costs, royalties,
and production taxes, but are exclusive of amortization, reclamation, capital and exploration costs. Total cash costs are then divided
by gold equivalent ounces sold to arrive at the total cash costs per equivalent ounce sold.
In addition to gold, the Company produces copper and
silver. Gold equivalent ounces of copper and silver produced or sold in a quarter are computed using a consistent ratio of copper and
silver prices to the gold price and multiplying this ratio by the pounds of copper and silver ounces produced or sold during that quarter.
Notwithstanding the impact of copper and silver sales,
as the Company is focused on gold production, New Gold aims to assess the economic results of its operations in relation to gold, which
is the primary driver of New Gold's business. New Gold believes this metric is of interest to its investors, who invest in the Company
primarily as a gold mining business. To determine the relevant costs associated with gold equivalent ounces, New Gold believes it is appropriate
to reflect all operating costs incurred in its operations.
All-In Sustaining Costs per Gold eq. Ounce
"All-in sustaining costs per gold equivalent
ounce" is a non-GAAP financial performance measure that does not have any standardized meaning under IFRS and therefore may not be
comparable to similar measures presented by other issuers. New Gold calculates "all-in sustaining costs per gold equivalent ounce"
based on guidance announced by the World Gold Council ("WGC") in September 2013. The WGC is a non-profit association of the
world's leading gold mining companies established in 1987 to promote the use of gold to industry, consumers and investors. The WGC is
not a regulatory body and does not have the authority to develop accounting standards or disclosure requirements. The WGC has worked
with its member companies to develop a measure that expands on IFRS measures to provide visibility into the economics of a gold mining
company. Current IFRS measures used in the gold industry, such as operating expenses, do not capture all of the expenditures incurred
to discover, develop and sustain gold production. New Gold believes that "all-in sustaining costs per gold equivalent ounce"
provides further transparency into costs associated with producing gold and will assist analysts, investors, and other stakeholders of
the Company in assessing its operating performance, its ability to generate free cash flow from current operations and its overall value.
In addition, the Human Resources and Compensation Committee of the Board of Directors uses "all-in sustaining costs", together
with other measures, in its Company scorecard to set incentive compensation goals and assess performance.
"All-in sustaining costs per gold equivalent
ounce" is intended to provide additional information only and does not have any standardized meaning under IFRS and may not be comparable
to similar measures presented by other mining companies. It should not be considered in isolation or as a substitute for measures of performance
prepared in accordance with IFRS. The measure is not necessarily indicative of cash flow from operations under IFRS or operating costs
presented under IFRS.
New Gold defines "all-in sustaining costs per
gold equivalent ounce" as the sum of total cash costs, net capital expenditures that are sustaining in nature, corporate general
and administrative costs, capitalized and expensed exploration that is sustaining in nature, lease payments that are sustaining in nature,
and environmental reclamation costs, all divided by the total gold equivalent ounces sold to arrive at a per ounce figure. The "Sustaining
Capital Expenditure Reconciliation" table below reconciles New Gold's sustaining capital to its cash flow statement. The definition
of sustaining versus non-sustaining is similarly applied to capitalized and expensed exploration costs and lease payments. Exploration
costs and lease payments to develop new operations or that relate to major projects at existing operations where these projects are expected
to materially increase production are classified as non-sustaining and are excluded. Gold equivalent ounces of copper and silver produced
or sold in a quarter are computed using a consistent ratio of copper and silver prices to the gold price and multiplying this ratio by
the pounds of copper and silver ounces produced or sold during that quarter.
Costs excluded from all-in sustaining costs are non-sustaining
capital expenditures, non-sustaining lease payments and exploration costs, financing costs, tax expense, and transaction costs associated
with mergers, acquisitions and divestitures, and any items that are deducted for the purposes of adjusted earnings.
Sustaining Capital and Sustaining Leases
"Sustaining capital" and "sustaining
lease" are non-GAAP financial performance measures that do not have any standardized meaning under IFRS and therefore may not be
comparable to similar measures presented by other issuers. New Gold defines "sustaining capital" as net capital expenditures
that are intended to maintain operation of its gold producing assets. Similarly, a "sustaining lease" is a lease payment that
is sustaining in nature. To determine "sustaining capital" expenditures, New Gold uses cash flow related to mining interests
from its consolidated statement of cash flows and deducts any expenditures that are capital expenditures to develop new operations or
capital expenditures related to major projects at existing operations where these projects will materially increase production. Management
uses "sustaining capital" and "sustaining lease", to understand the aggregate net result of the drivers of all-in
sustaining costs other than total cash costs. These measures are intended to provide additional information only and should not be considered
in isolation or as substitutes for measures of performance prepared in accordance with IFRS.
Growth Capital
"Growth capital" is a non-GAAP financial
performance measure that does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented
by other issuers. New Gold considers non-sustaining capital costs to be "growth capital", which are capital expenditures to
develop new operations or capital expenditures related to major projects at existing operations where these projects will materially increase
production. To determine "growth capital" expenditures, New Gold uses cash flow related to mining interests from its consolidated
statement of cash flows and deducts any expenditures that are capital expenditures that are intended to maintain operation of its gold
producing assets. Management uses "growth capital" to understand the cost to develop new operations or related to major projects
at existing operations where these projects will materially increase production. This measure is intended to provide additional information
only and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
The following tables reconcile the above non-GAAP
measures to the most directly comparable IFRS measure on an aggregate basis.
Consolidated OPEX, Cash Cost and All-in Sustaining
Costs Reconciliation
| |
Three months ended December 31 |
Year ended December 31 |
| (in millions of U.S. dollars, except where noted) |
2021 |
2020 |
2021 |
2020 |
CONSOLIDATED OPEX, CASH COST AND ALL-IN
SUSTAINING COSTS RECONCILIATION |
|
|
|
|
| Operating expenses |
99.6 |
97.3 |
377.3 |
339.9 |
| Gold equivalent ounces sold1 |
109,214 |
122,139 |
402,449 |
428,370 |
| Operating expenses per gold equivalent ounce sold ($/ounce) |
912 |
799 |
938 |
794 |
| Operating expenses |
99.6 |
97.3 |
377.4 |
339.9 |
| Treatment and refining charges on concentrate sales |
5.8 |
5.1 |
21.5 |
19.7 |
| Total cash costs |
105.4 |
102.4 |
398.9 |
359.6 |
| Gold equivalent ounces sold1 |
109,214 |
122,139 |
402,449 |
428,370 |
| Total cash costs per gold equivalent ounce sold ($/ounce)2 |
965 |
841 |
991 |
840 |
| Sustaining capital expenditures2 |
30.7 |
66.4 |
144.2 |
194.7 |
| Sustaining exploration - expensed |
0.0 |
0.2 |
0.8 |
0.2 |
| Sustaining leases2 |
2.4 |
2.7 |
10.4 |
10.8 |
| Corporate G&A including share-based compensation |
5.9 |
7.5 |
22.8 |
21.5 |
| Reclamation expenses |
3.6 |
2.5 |
11.6 |
8.4 |
| Total all-in sustaining costs |
148.0 |
182.0 |
588.6 |
595.2 |
| Gold equivalent ounces sold1 |
109,214 |
122,139 |
402,449 |
428,370 |
| All-in sustaining costs per gold equivalent ounce sold ($/ounce)2 |
1,355 |
1,491 |
1,463 |
1,389 |
| |
Three months ended December 31 |
Year ended December 31 |
| (in millions of U.S. dollars, except where noted) |
2021 |
2020 |
2021 |
2020 |
| RAINY RIVER OPEX, CASH COSTS AND AISC RECONCILIATION |
|
|
|
|
| Operating expenses |
61.3 |
62.4 |
226.5 |
213.2 |
| Gold equivalent ounces sold1 |
68,380 |
72,279 |
237,061 |
235,416 |
| Operating expenses per unit of gold sold ($/ounce) |
897 |
864 |
955 |
906 |
| Operating expenses |
61.3 |
62.4 |
226.5 |
213.2 |
| Total cash costs |
61.3 |
62.4 |
226.5 |
213.2 |
| Gold equivalent ounces sold1 |
68,380 |
72,279 |
237,061 |
235,416 |
| Total cash costs per gold equivalent ounce sold ($/ounce)2 |
897 |
864 |
955 |
906 |
| Sustaining capital expenditures2 |
21.1 |
41.1 |
90.5 |
137.7 |
| Sustaining leases2 |
2.3 |
2.5 |
9.5 |
9.8 |
| Reclamation expenses |
2.8 |
2.0 |
8.9 |
6.9 |
| Total all-in sustaining costs |
87.6 |
108.0 |
335.5 |
367.6 |
| Gold equivalent ounces sold1 |
68,380 |
72,279 |
237,061 |
235,416 |
| All-in sustaining costs per gold equivalent ounce sold ($/ounce)2 |
1,281 |
1,494 |
1,415 |
1,562 |
Sustaining Capital Expenditures Reconciliation Table
| |
Three months ended December 31 |
Year ended December 31 |
| (in millions of U.S. dollars, except where noted) |
2021 |
2020 |
2021 |
2020 |
| TOTAL SUSTAINING CAPITAL EXPENDITURES |
|
|
|
|
| Mining interests per statement of cash flows |
58.1 |
109.2 |
247.3 |
284.2 |
| New Afton growth capital expenditures2 |
(24.6) |
(39.9) |
(90.1) |
(77.1) |
| Rainy River growth capital expenditures2 |
(2.2) |
(2.8) |
(11.6) |
(3.1) |
| Blackwater growth capital expenditures2 |
- |
- |
- |
(9.2) |
| Sustaining capital expenditures2 |
31.3 |
66.5 |
145.6 |
194.8 |
Adjusted Net Earnings/(Loss) and Adjusted Net Earnings
per Share
"Adjusted net earnings" and "adjusted
net earnings per share" are non-GAAP financial performance measures that do not have any standardized meaning under IFRS and therefore
may not be comparable to similar measures presented by other issuers. "Adjusted net earnings" and "adjusted net earnings
per share" exclude "other gains and losses" as per Note 3 of the Company's consolidated financial statements; and loss
on redemption of long-term debt. Net earnings have been adjusted, including the associated tax impact, for the group of costs in
"Other gains and losses" on the condensed consolidated income statements. Key entries in this grouping are: the fair value changes
for the gold stream obligation, fair value changes for the free cash flow interest obligation, fair value changes for gold and copper
price option contracts, gain on disposal of the Blackwater stream and Blackwater Project, foreign exchange gains/loss and fair value changes
in investments. The income tax adjustments reflect the tax impact of the above adjustments and is referred to as "adjusted tax expense".
The Company uses "adjusted net earnings"
for its own internal purposes. Management's internal budgets and forecasts and public guidance do not reflect the items which have been
excluded from the determination of "adjusted net earnings". Consequently, the presentation of "adjusted net earnings"
enables investors to better understand the underlying operating performance of the Company's core mining business through the eyes of
management. Management periodically evaluates the components of "adjusted net earnings" based on an internal assessment of performance
measures that are useful for evaluating the operating performance of New Gold's business and a review of the non-GAAP financial performance
measures used by mining industry analysts and other mining companies. "Adjusted net earnings" and "adjusted net earnings
per share" are intended to provide additional information only and should not be considered in isolation or as substitutes for measures
of performance prepared in accordance with IFRS. These measures are not necessarily indicative of operating profit or cash flows from
operations as determined under IFRS. The following table reconciles these non-GAAP financial performance measures to the most directly
comparable IFRS measure.
| |
Three months ended December 31 |
Year ended December 31 |
| (in millions of U.S. dollars, except where noted) |
2021 |
2020 |
2021 |
2020 |
| ADJUSTED NET EARNINGS (LOSS) RECONCILIATION |
|
|
|
|
| Earnings (loss) before taxes |
156.8 |
(16.0) |
160.3 |
(75.0) |
| Other losses (gains) |
(123.6) |
26.5 |
(57.5) |
78.3 |
| Loss on repayment of long-term debt |
- |
16.8 |
- |
23.3 |
| Adjusted net earnings (loss) before taxes |
33.2 |
27.3 |
102.8 |
26.6 |
| Income tax (expense) recovery |
(5.9) |
(5.1) |
(19.7) |
(4.3) |
| Income tax adjustments |
(2.6) |
5.7 |
(0.2) |
(3.1) |
| Adjusted income tax (expense) recovery2 |
(8.5) |
0.6 |
(19.9) |
(7.4) |
| Adjusted net earnings (loss)2 |
24.7 |
27.9 |
82.9 |
19.2 |
| Adjusted earnings (loss) per share (basic and diluted)2 |
0.04 |
0.04 |
0.12 |
0.03 |
Cash Generated from Operations, before Changes in
Non-Cash Operating Working Capital
"Cash generated from operations, before changes
in non-cash operating working capital" is a non-GAAP financial performance measure that does not have any standardized meaning under
IFRS and therefore may not be comparable to similar measures presented by other issuers. Other companies may calculate this measure differently
and this measure is unlikely to be comparable to similar measures presented by other companies. "Cash generated from operations,
before changes in non-cash operating working capital" excludes changes in non-cash operating working capital. New Gold believes this
non-GAAP financial measure provides further transparency and assists analysts, investors and other stakeholders of the Company in assessing
the Company's ability to generate cash from its operations before temporary working capital changes.
Cash generated from operations, before non-cash changes
in working capital is intended to provide additional information only and should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with IFRS. This measure is not necessarily indicative of operating profit or cash flows
from operations as determined under IFRS. The following table reconciles this non-GAAP financial performance measure to the most directly
comparable IFRS measure.
| |
Three months ended December 31 |
Year ended December 31 |
| (in millions of U.S. dollars) |
2021 |
2020 |
2021 |
2020 |
| CASH RECONCILIATION |
|
|
|
|
| Cash generated from operations |
105.7 |
98.4 |
323.7 |
294.8 |
| Change in non-cash operating working capital |
(12.8) |
(3.5) |
(1.0) |
(16.2) |
| Cash generated from operations, before changes in non-cash operating working capital2 |
92.9 |
94.9 |
322.7 |
278.6 |
Free Cash Flow
"Free cash flow" is a non-GAAP financial
performance measure that does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented
by other issuers. New Gold defines "free cash flow" as cash generated from operations and proceeds of sale of other assets less
capital expenditures on mining interests, lease payments, settlement of non-current derivative financial liabilities which include the
gold stream obligation and the Ontario Teachers' Pension Plan free cash flow interest. New Gold believes this non-GAAP financial performance
measure provides further transparency and assists analysts, investors and other stakeholders of the Company in assessing the Company's
ability to generate cash flow from current operations. "Free cash flow" is intended to provide additional information only and
should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. This measure is
not necessarily indicative of operating profit or cash flows from operations as determined under IFRS. The following tables reconcile
this non-GAAP financial performance measure to the most directly comparable IFRS measure on an aggregate and mine-by-mine basis.
| |
Three months ended December 31, 2021 |
| (in millions of U.S. dollars) |
Rainy River |
New Afton |
Other |
Total |
| FREE CASH FLOW RECONCILIATION |
|
|
|
|
| Cash generated from operations |
67.7 |
44.5 |
(6.5) |
105.7 |
| Less Mining interest capital expenditures |
(24.0) |
(34.3) |
0.2 |
(58.1) |
| Add Proceeds of sale from other assets |
0.6 |
0.0 |
0.0 |
0.6 |
| Less Lease payments |
(2.3) |
0.1 |
(0.2) |
(2.4) |
| Less Cash settlement of non-current derivative financial liabilities |
(6.5) |
- |
- |
(6.5) |
| Free Cash Flow |
35.5 |
10.3 |
(6.5) |
39.3 |
| |
Three months ended December 31, 2020 |
| (in millions of U.S. dollars) |
Rainy River |
New Afton |
Other |
Total |
| FREE CASH FLOW RECONCILIATION |
|
|
|
|
| Cash generated from operations |
59.0 |
46.5 |
(7.0) |
98.5 |
| Less Mining interest capital expenditures |
(43.9) |
(65.3) |
(0.2) |
(109.4) |
| Less Lease payments |
(2.5) |
(0.1) |
(0.2) |
(2.8) |
| Less Cash settlement of non-current derivative financial liabilities |
(7.0) |
- |
- |
(7.0) |
| Free Cash Flow |
5.6 |
(18.9) |
(7.3) |
(20.7) |
| |
Year ended December 31, 2021 |
| (in millions of U.S. dollars) |
Rainy River |
New Afton |
Other |
Total |
| FREE CASH FLOW RECONCILIATION |
|
|
|
|
| Cash generated from operations |
184.9 |
165.1 |
(26.3) |
323.7 |
| Less Mining interest capital expenditures |
(103.0) |
(144.4) |
0.1 |
(247.3) |
| Add Proceeds of sale from other assets |
0.9 |
0.5 |
0.0 |
1.4 |
| Less Lease payments |
(9.5) |
(0.3) |
(0.6) |
(10.4) |
| Less Cash settlement of non-current derivative financial liabilities |
(27.3) |
(5.0) |
- |
(32.3) |
| Free Cash Flow |
46.0 |
15.9 |
(26.8) |
35.1 |
| |
Year ended December 31, 2020 |
| (in millions of U.S. dollars) |
Rainy River |
New Afton |
Other |
Total |
| FREE CASH FLOW RECONCILIATION |
|
|
|
|
| Cash generated from operations |
165.2 |
141.9 |
(12.3) |
294.8 |
| Less Mining interest capital expenditures |
(140.8) |
(134.1) |
(9.4) |
(284.2) |
| Less Lease payments |
(9.8) |
(0.5) |
(0.7) |
(11.0) |
| Less Cash settlement of non-current derivative financial liabilities |
(21.9) |
- |
- |
(21.9) |
| Free Cash Flow |
(7.3) |
7.4 |
(22.3) |
(22.2) |
Average Realized Price
"Average realized price per ounce of gold sold"
is a non-GAAP financial performance measure that does not have any standardized meaning under IFRS and therefore may not be comparable
to similar measures presented by other issuers. Other companies may calculate this measure differently and this measure is unlikely to
be comparable to similar measures presented by other companies. Management uses this measure to better understand the price realized in
each reporting period for gold sales. "Average realized price per ounce of gold sold" is intended to provide additional information
only and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The following
tables reconcile this non-GAAP financial performance measure to the most directly comparable IFRS measure on an aggregate and mine-by-mine
basis.
| |
Three months ended December 31 |
Year ended December 31 |
| (in millions of U.S. dollars, except where noted) |
2021 |
2020 |
2021 |
2020 |
| TOTAL AVERAGE REALIZED PRICE |
|
|
|
|
| Revenue from gold sales |
139.9 |
138.8 |
492.6 |
449.3 |
| Treatment and refining charges on gold concentrate sales |
1.5 |
1.5 |
5.6 |
6.3 |
| Gross revenue from gold sales |
141.4 |
140.3 |
498.2 |
455.6 |
| Gold ounces sold |
78,745 |
86,491 |
277,451 |
291,877 |
| Total average realized price per gold ounce sold ($/ounce)2 |
1,798 |
1,623 |
1,798 |
1,559 |
| |
Three months ended December 31 |
Year ended December 31 |
| (in millions of U.S. dollars, except where noted) |
2021 |
2020 |
2021 |
2020 |
| RAINY RIVER AVERAGE REALIZED PRICE |
|
|
|
|
| Revenue from gold sales |
118.9 |
114.8 |
410.9 |
360.7 |
| Gold ounces sold |
66,239 |
70,675 |
228,693 |
231,112 |
| Rainy River average realized price per gold ounce sold ($/ounce)2 |
1,796 |
1,624 |
1,797 |
1,561 |
| |
Three months ended December 31 |
Year ended December 31 |
| (in millions of U.S. dollars, except where noted) |
2021 |
2020 |
2021 |
2020 |
| NEW AFTON AVERAGE REALIZED PRICE |
|
|
|
|
| Revenue from gold sales |
20.9 |
24.1 |
81.7 |
88.6 |
| Treatment and refining charges on gold concentrate sales |
1.5 |
1.5 |
5.5 |
6.3 |
| Gross revenue from gold sales |
22.4 |
25.6 |
87.2 |
94.9 |
| Gold ounces sold |
12,507 |
15,817 |
48,758 |
60,765 |
| New Afton average realized price per gold ounce sold ($/ounce)2 |
1,807 |
1,621 |
1,804 |
1,553 |
For additional information with respect to the non-GAAP
measures used by the Company, refer to the detailed "Non-GAAP Financial Performance Measure" section disclosure in the MD&A
for the three months and year ended December 31, 2021 filed at www.sedar.com and on EDGAR at www.sec.gov.
Mineral Reserves and Mineral Resources
New Gold's Mineral Reserve estimates as at December
31, 2021, is presented in the following table.
Mineral Reserves
| |
Metal Grade |
Contained Metal |
| |
Tonnes
000s |
Gold
g/t |
Silver
g/t |
Copper
% |
Gold
Koz |
Silver
Koz |
Copper
Mlbs |
| RAINY RIVER |
| Direct processing reserves |
|
|
|
|
|
|
|
| Open Pit |
|
|
|
|
|
|
|
| Proven |
9,486 |
1.26 |
2.2 |
- |
385 |
657 |
- |
| Probable |
21,861 |
1.20 |
2.2 |
- |
845 |
1,513 |
- |
| Open Pit P&P (direct proc.) |
31,347 |
1.22 |
2.2 |
- |
1,230 |
2,170 |
- |
| Stockpile DPO |
|
|
|
|
|
|
|
| Proven |
1,247 |
0.65 |
2.5 |
- |
26 |
98 |
- |
| Probable |
- |
- |
- |
- |
- |
- |
- |
| Total Stockpile |
1,247 |
0.65 |
2.5 |
- |
26 |
98 |
- |
| Low grade reserves |
|
|
|
|
|
|
|
| Open Pit |
|
|
|
|
|
|
|
| Proven |
2,982 |
0.36 |
1.7 |
- |
34 |
164 |
- |
| Probable |
9,426 |
0.36 |
1.9 |
- |
108 |
588 |
- |
| Open Pit P&P (low grade) |
12,408 |
0.36 |
1.9 |
- |
142 |
752 |
- |
| Stockpile |
|
|
|
|
|
|
|
| Proven |
12,561 |
0.39 |
2.3 |
- |
159 |
918 |
- |
| Probable |
- |
- |
- |
- |
- |
- |
- |
| Open Pit P&P (stockpile) |
12,561 |
0.39 |
2.3 |
- |
159 |
918 |
- |
| Open Pit P&P (Direct proc. & Low grade) |
57,563 |
0.84 |
2.1 |
- |
1,558 |
3,938 |
- |
| Underground |
|
|
|
|
|
|
|
| Proven |
- |
- |
- |
- |
- |
- |
- |
| Probable |
12,657 |
3.05 |
7.6 |
- |
1,241 |
3,084 |
- |
| Underground P&P (direct proc.) |
12,657 |
3.05 |
7.6 |
- |
1,241 |
3,084 |
- |
| Combined Direct proc. & Low grade |
|
|
|
|
|
|
|
| Proven |
26,276 |
0.72 |
2.2 |
- |
605 |
1,837 |
- |
| Probable |
43,944 |
1.55 |
3.7 |
- |
2,194 |
5,185 |
- |
| Total Rainy River P&P |
70,220 |
1.24 |
3.1 |
- |
2,799 |
7,022 |
- |
| NEW AFTON |
| A&B Zones |
|
|
|
|
|
|
|
| Proven |
- |
- |
- |
- |
- |
- |
- |
| Probable |
2,961 |
0.59 |
2.8 |
0.73 |
56 |
267 |
48 |
| B3 Zone |
|
|
|
|
|
|
|
| Proven |
- |
- |
- |
- |
- |
- |
- |
| Probable |
8,801 |
0.63 |
1.4 |
0.74 |
178 |
394 |
143 |
| C-Zone |
|
|
|
|
|
|
|
| Proven |
- |
- |
- |
- |
- |
- |
- |
| Probable |
29,512 |
0.68 |
1.8 |
0.75 |
649 |
1,666 |
485 |
| Total New Afton P&P |
41,274 |
0.67 |
1.8 |
0.74 |
883 |
2,327 |
675 |
| TOTAL PROVEN & PROBABLE RESERVES |
3,682 |
9,349 |
675 |
Notes to the mineral reserve and mineral resource
estimates are provided below.
Measured and Indicated Mineral Resources
New Gold's Mineral Resource estimates as at December
31, 2021, is presented in the following table.
Measured and Indicated Mineral Resources (Exclusive
of Mineral Reserves)
| |
|
Metal Grade |
Contained Metal |
| |
Tonnes
000s |
Gold
g/t |
Silver
g/t |
Copper
% |
Gold
Koz |
Silver
Koz |
Copper
Mlbs |
| Direct processing resources |
|
|
|
|
|
|
|
| Open Pit |
|
|
|
|
|
|
|
| Measured |
570 |
1.61 |
3.0 |
- |
30 |
55 |
- |
| Indicated |
3,131 |
1.48 |
3.2 |
- |
149 |
325 |
- |
| Open Pit M&I (direct proc.) |
3,701 |
1.50 |
3.2 |
- |
179 |
380 |
- |
| Underground |
|
|
|
|
|
|
|
| Measured |
- |
- |
- |
- |
- |
- |
- |
| Indicated |
14,014 |
2.99 |
7.6 |
- |
1,348 |
3,422 |
- |
| Underground M&I (direct proc.) |
14,014 |
2.99 |
7.6 |
- |
1,348 |
3,422 |
- |
| Low grade resources |
|
|
|
|
|
|
|
| Open Pit |
|
|
|
|
|
|
|
| Measured |
192 |
0.34 |
2.0 |
- |
2 |
12 |
- |
| Indicated |
1,268 |
0.34 |
1.9 |
- |
14 |
80 |
- |
| Open Pit M&I (low grade) |
1,460 |
0.34 |
2.0 |
- |
16 |
92 |
- |
| Combined M&I |
|
|
|
|
|
|
|
| Measured |
762 |
1.29 |
2.7 |
- |
32 |
67 |
- |
| Indicated |
18,413 |
2.55 |
6.5 |
- |
1,511 |
3,827 |
- |
| Total Rainy River M&I |
19,175 |
2.50 |
6.3 |
- |
1,543 |
3,894 |
- |
| NEW AFTON |
| A&B Zones |
|
|
|
|
|
|
|
| Measured |
21,426 |
0.52 |
1.2 |
0.72 |
361 |
848 |
338 |
| Indicated |
10,387 |
0.34 |
2.8 |
0.55 |
114 |
932 |
127 |
| A&B Zone M&I |
31,812 |
0.46 |
1.7 |
0.66 |
475 |
1,780 |
465 |
| C-Zone |
|
|
|
|
|
|
|
| Measured |
4,227 |
0.87 |
2.2 |
1.09 |
118 |
297 |
102 |
| Indicated |
2,387 |
1.23 |
3.2 |
1.57 |
94 |
245 |
83 |
| C-Zone M&I |
6,614 |
1.00 |
2.6 |
1.27 |
212 |
542 |
185 |
| HW Lens |
|
|
|
|
|
|
|
| Measured |
- |
- |
- |
- |
- |
- |
- |
| Indicated |
11,450 |
0.51 |
2.0 |
0.44 |
186 |
740 |
110 |
| HW Lens M&I |
11,450 |
0.51 |
2.0 |
0.44 |
186 |
740 |
110 |
| D Zone |
|
|
|
|
|
|
|
| Measured |
1,470 |
0.80 |
1.9 |
0.81 |
38 |
91 |
26 |
| Indicated |
5,875 |
0.70 |
1.9 |
0.79 |
131 |
363 |
102 |
| D Zone M&I |
7,345 |
0.72 |
1.9 |
0.79 |
169 |
454 |
128 |
| Eastern Extension |
|
|
|
|
|
|
|
| Measured |
403 |
0.48 |
1.8 |
0.57 |
6 |
23 |
5 |
| Indicated |
7,276 |
0.54 |
2.8 |
0.71 |
126 |
648 |
113 |
| Eastern Extension M&I |
7,679 |
0.53 |
2.7 |
0.70 |
132 |
671 |
118 |
| Combined M&I |
|
|
|
|
|
|
|
| Measured |
27,526 |
0.59 |
1.4 |
0.78 |
523 |
1,259 |
471 |
| Indicated |
37,375 |
0.54 |
2.4 |
0.65 |
651 |
2,928 |
535 |
| Total New Afton M&I |
64,900 |
0.56 |
2.0 |
0.70 |
1,174 |
4,187 |
1,006 |
| TOTAL MEASURED & INDICATED RESOURCES |
2,717 |
8,081 |
1,006 |
| Notes to the mineral reserve and mineral resource estimates are provided below. |
| |
|
|
|
|
|
|
|
|
Inferred Mineral Resources
| |
|
Metal Grade |
Contained Metal |
| |
Tonnes
000s |
Gold
g/t |
Silver
g/t |
Copper
% |
Gold
Koz |
Silver
Koz |
Copper
Mlbs |
| RAINY RIVER |
| Direct processing |
|
|
|
|
|
|
|
| Open Pit |
481 |
0.98 |
2.5 |
- |
15 |
38 |
- |
| Underground |
1,593 |
3.30 |
2.7 |
- |
169 |
141 |
- |
| Total Direct Processing |
2,074 |
2.76 |
2.7 |
- |
184 |
179 |
- |
| Low grade resources |
|
|
|
|
|
|
|
| Open Pit |
404 |
0.35 |
1.3 |
- |
5 |
17 |
- |
| Rainy River Inferred |
2,478 |
2.37 |
2.5 |
- |
189 |
196 |
- |
| NEW AFTON |
| A&B Zones |
6,773 |
0.38 |
1.4 |
0.35 |
84 |
296 |
52 |
| C-Zone |
1,438 |
0.50 |
0.8 |
0.19 |
23 |
35 |
6 |
| HW Lens |
3 |
0.49 |
0.6 |
0.19 |
- |
- |
- |
| D Zone |
4,685 |
0.32 |
1.3 |
0.52 |
48 |
197 |
53 |
| Eastern Extension |
3,402 |
0.40 |
1.0 |
0.35 |
43 |
107 |
26 |
| New Afton Inferred |
16,301 |
0.38 |
1.2 |
0.38 |
198 |
635 |
137 |
| TOTAL INFERRED |
|
|
|
|
387 |
831 |
137 |
| Notes to the mineral reserve and mineral resource estimates are provided below. |
| |
|
|
|
|
|
|
|
|
Notes to Mineral Reserve and Resource Estimates
| 1. New Gold's Mineral Reserves and Mineral Resources have been estimated in accordance with the CIM Standards, which are incorporated by reference in NI 43-101. |
| |
|
| 2. All Mineral Reserve and Mineral Resource estimates for New Gold's properties and projects are effective December 31, 2021. |
| |
|
3. New Gold's year-end 2021 Mineral Reserves and Mineral Resources have been estimated based on the following metal prices and foreign exchange (FX) rate criteria:
|
|
Gold
$/ounce |
Silver
$/ounce |
Copper
$/pound |
FX
CAD:USD |
| Mineral Reserves |
$1,400 |
$19.00 |
$3.25 |
$1.25 |
| Mineral Resources |
$1,500 |
$21.00 |
$3.50 |
$1.25 |
| |
|
|
|
|
|
| |
|
4. Lower cut-offs for the Company's Mineral Reserves and Mineral Resources are outlined in the following table:
|
| Mineral Property |
Mineral Reserves
Lower cut-off |
Mineral Resources
Lower Cut-off |
| Rainy River |
O/P direct processing: |
0.46 - 0.49 g/t AuEq |
0.44 - 0.45 g/t AuEq |
| |
O/P low grade material: |
0.30 g/t AuEq |
0.30 g/t AuEq |
| |
U/G direct processing: |
Intrepid Zone: 1.93 g/t AuEq
ODM Main Zones: 2.25 g/t AuEq |
1.70 g/t AuEq |
| |
U/G with LGO Stockpile processing: |
ODM Main Zones: 1.74 g/t AuEq |
1.70 g/t AuEq |
| New Afton |
A&B Zones: |
USD$ 10.00/t |
All Resources: 0.40% CuEq |
| |
B3 Block & C-Zone: |
USD$ 24.00/t |
| |
|
|
|
|
|
| |
|
| 5. |
New Gold reports its Measured and Indicated Mineral Resources exclusive of Mineral Reserves. Measured and Indicated Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. Inferred Mineral Resources have a greater amount of uncertainty as to their existence and technical feasibility, do not have demonstrated economic viability, and are likewise exclusive of Mineral Reserves. Numbers may not add due to rounding. |
| |
|
| 6. |
Mineral Resources are classified as Measured, Indicated and Inferred based on relative levels of confidence in their estimation and on technical and economic parameters consistent with the methods considered to be most suitable to their potential commercial extraction. The designators 'open pit' and 'underground' may be used to indicate the envisioned mining method for different portions of a resource. Similarly, the designators 'direct processing' and 'lower grade material' may be applied to differentiate material envisioned to be mined and processed directly from material to be mined and stored separately for future processing. Mineral Reserves and Mineral Resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing and other risks and relevant issues including those listed in New Gold's most recent Annual Information Form. Additional details regarding Mineral Reserve and Mineral Resource estimation, classification, reporting parameters, key assumptions and associated risks for each of New Gold's material properties are provided in the respective NI 43-101 Technical Reports, which are available at www.sedar.com. |
| |
|
| 7. |
Rainy River Mine: In addition to the criteria described above, Mineral Reserves and Mineral Resources for the Rainy River project are reported according to the following criteria: Underground Mineral Reserves are reported peripheral to and/or below the open pit Mineral Reserve pit shell, which has been designed and optimized based on a $1,400/oz gold price. Open pit and underground Mineral Resources are reported based on a $1,500/oz gold price. Open pit Mineral Resources are reported from within an open pit resource shell that extends to a depth of approximately 340 meters from surface. Open pit Mineral Resources exclude material reported as underground Mineral Reserves. New Afton Mine: C-Zone Mineral Resources reported at December 31, 2021, have been further subdivided under C-Zone, D-Zone and Eastern Extension based upon geological model refinement and location within the New Afton deposit. |
| |
|
| 8. |
The preparation of New Gold's consolidated statement and estimation of mineral reserves has been completed under the oversight and review of Mr. Andrew Croal, Director of Technical Services for the Company. Mr. Croal is a Professional Engineer and member of the Association of Professional Engineers Ontario. Preparation of New Gold's consolidated statement and estimation of mineral resources has been completed under the oversight and review of Mr. Michele Della Libera, Director, Exploration for the Company. Mr. Della Libera is a Professional Geoscientist and member of the Association of Professional Geoscientist of Ontario and of the Engineers and Geoscientist of British Columbia. Mr. Croal and Mr. Della Libera are "Qualified Persons" as defined by NI 43-101. |
Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this news release,
including any information relating to New Gold's future financial or operating performance are "forward-looking". All statements
in this news release, other than statements of historical fact, which address events, results, outcomes or developments that New Gold
expects to occur are "forward-looking statements". Forward-looking statements are statements that are not historical facts and
are generally, but not always, identified by the use of forward-looking terminology such as "plans", "expects", "is
expected", "budget", "scheduled", "targeted", "estimates", "forecasts", "intends",
"anticipates", "projects", "potential", "believes" or variations of such words and phrases or
statements that certain actions, events or results "may", "could", "would", "should", "might"
or "will be taken", "occur" or "be achieved" or the negative connotation of such terms. Forward-looking
statements in this news release include, among others, statements with respect to: the Company's anticipated focus on operational excellence
and optimization at both assets and its ability to execute on its strategy; the advancement of development of the Intrepid underground
zone at Rainy River and targeted timing for initial production; prioritizing B3 ramp-up and C-Zone development at New Afton; the Company's
expectations regarding production, costs, capital investments and expenses on a consolidated and mine-by-mine basis, and the factors contributing
to those expected results; planned activities, undertakings and areas of focus at the Rainy River Mine and New Afton Mine and expectations
of timing and costs associated therewith; expectations regarding production timing; planned reporting on a gold equivalent and per-metal
basis; the anticipated mining of the East Lobe and the contribution of mill feed there from in 2022; the Company's expectations regarding
a higher strip ratio and increase in the open pit strip ratio for 2022 at Rainy River as well as the anticipated results therefrom; anticipated
capital and exploration expenditures at Rainy River Mine and New Afton Mine; anticipated timing for filing of the NI 43-101 Technical
Report for Rainy River; the reduction in B3 ore tonnes to be mined in 2022 at New Afton; expectations regarding current surface stockpiles
at New Afton; and the Company's plans relating to its ESG approach.
All forward-looking statements in this news release
are based on the opinions and estimates of management that, while considered reasonable as at the date of this press release in light
of management's experience and perception of current conditions and expected developments, are inherently subject to important risk factors
and uncertainties, many of which are beyond New Gold's ability to control or predict. Certain material assumptions regarding such forward-looking
statements are discussed in this news release, New Gold's latest annual management's discussion and analysis ("MD&A"), its
most recent annual information form and technical reports on the Rainy River Mine and New Afton Mine filed on SEDAR at www.sedar.com and
on EDGAR at www.sec.gov. In addition to, and subject to, such assumptions discussed in more detail elsewhere, the forward-looking statements
in this news release are also subject to the following assumptions: (1) there being no significant disruptions affecting New Gold's operations
other than as set out herein; (2) political and legal developments in jurisdictions where New Gold operates, or may in the future operate,
being consistent with New Gold's current expectations; (3) the accuracy of New Gold's current mineral reserve and mineral resource estimates
and the grade of gold, silver and copper expected to be mined and the grade of gold, copper and silver expected to be mined; (4) the exchange
rate between the Canadian dollar and U.S. dollar, and to a lesser extent, the Mexican Peso, and commodity prices being approximately consistent
with current levels and expectations for the purposes of 2022 guidance and otherwise; (5) prices for diesel, natural gas, fuel oil, electricity
and other key supplies being approximately consistent with current levels; (6) equipment, labour and materials costs increasing on a basis
consistent with New Gold's current expectations; (7) arrangements with First Nations and other Aboriginal groups in respect of the New
Afton Mine and Rainy River Mine being consistent with New Gold's current expectations; (8) all required permits, licenses and authorizations
being obtained from the relevant governments and other relevant stakeholders within the expected timelines and the absence of material
negative comments or obstacles during any applicable regulatory processes; (9) there being no significant disruptions to the Company's
workforce at either the Rainy River Mine or New Afton Mine due to cases of COVID-19 (including any required self-isolation requirements
due to cross-border travel to the United States or any other country or any other reason) or otherwise; (10) the responses of the relevant
governments to the COVID-19 outbreak being sufficient to contain the impact of the COVID-19 outbreak; (11) there being no material disruption
to the Company's supply chains and workforce that would interfere with the Company's anticipated course of action at the Rainy River Mine
and the New Afton Mine; and (12) the long-term economic effects of the COVID-19 outbreak not having a material adverse impact on the Company's
operations or liquidity position.
Forward-looking statements are necessarily based on
estimates and assumptions that are inherently subject to known and unknown risks, uncertainties and other factors that may cause actual
results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking
statements. Such factors include, without limitation: price volatility in the spot and forward markets for metals and other commodities;
discrepancies between actual and estimated production, between actual and estimated costs, between actual and estimated Mineral Reserves
and Mineral Resources and between actual and estimated metallurgical recoveries; equipment malfunction, failure or unavailability; accidents;
risks related to early production at the Rainy River Mine, including failure of equipment, machinery, the process circuit or other processes
to perform as designed or intended; the speculative nature of mineral exploration and development, including the risks of obtaining and
maintaining the validity and enforceability of the necessary licenses and permits and complying with the permitting requirements of each
jurisdiction in which New Gold operates, including, but not limited to: obtaining the necessary permits for the New Afton C-Zone; uncertainties
and unanticipated delays associated with obtaining and maintaining necessary licenses, permits and authorizations and complying with permitting
requirements, including those associated with the C-Zone permitting process; changes in project parameters as plans continue to be refined;
changing costs, timelines and development schedules as it relates to construction; the Company not being able to complete its construction
projects at the Rainy River Mine or the New Afton Mine on the anticipated timeline or at all; volatility in the market price of the
Company's securities; changes in national and local government legislation in the countries in which New Gold does or may in the future
carry on business; controls, regulations and political or economic developments in the countries in which New Gold does or may in the
future carry on business; the Company's dependence on the Rainy River Mine and New Afton Mine; the Company not being able to complete
its exploration drilling programs on the anticipated timeline or at all; disruptions to the Company's workforce at either the Rainy River
Mine or the New Afton Mine, or both, due to cases of COVID-19 or any required self-isolation (due to cross-border travel, exposure to
a case of COVID-19 or otherwise); the responses of the relevant governments to the COVID-19 outbreak not being sufficient to contain the
impact of the COVID-19 outbreak; disruptions to the Company's supply chain and workforce due to the COVID-19 outbreak; an economic recession
or downturn as a result of the COVID-19 outbreak that materially adversely affects the Company's operations or liquidity position; there
being further shutdowns at the Rainy River Mine or New Afton Mine; significant capital requirements and the availability and management
of capital resources; additional funding requirements; diminishing quantities or grades of Mineral Reserves and Mineral Resources; actual
results of current exploration or reclamation activities; uncertainties inherent to mining economic studies including the Technical Reports
for the Rainy River Mine and New Afton Mine; impairment; unexpected delays and costs inherent to consulting and accommodating rights of
First Nations and other indigenous groups; climate change, environmental risks and hazards and the Company's response thereto; tailings
dam and structure failures; actual results of current exploration or reclamation activities; fluctuations in the international currency
markets and in the rates of exchange of the currencies of Canada, the United States and, to a lesser extent, Mexico; global economic and
financial conditions and any global or local natural events that may impede the economy or New Gold's ability to carry on business in
the normal course; compliance with debt obligations and maintaining sufficient liquidity; taxation; fluctuation in treatment and refining
charges; transportation and processing of unrefined products; rising costs or availability of labour, supplies, fuel and equipment; adequate
infrastructure; relationships with communities, governments and other stakeholders; geotechnical instability and conditions; labour
disputes; the uncertainties inherent in current and future legal challenges to which New Gold is or may become a party; defective title
to mineral claims or property or contests over claims to mineral properties; competition; loss of, or inability to attract, key employees;
use of derivative products and hedging transactions; counterparty risk and the performance of third party service providers; investment
risks and uncertainty relating to the value of equity investments in public companies held by the Company from time to time; the adequacy
of internal and disclosure controls; conflicts of interest; the lack of certainty with respect to foreign operations and legal systems,
which may not be immune from the influence of political pressure, corruption or other factors that are inconsistent with the rule of law;
the successful acquisitions and integration of business arrangements and realizing the intended benefits therefrom; and information systems
security threats. In addition, there are risks and hazards associated with the business of mineral exploration, development, construction,
operation and mining, including environmental events and hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins,
flooding and gold bullion losses (and the risk of inadequate insurance or inability to obtain insurance to cover these risks) as well
as "Risk Factors" included in New Gold's most recent annual information form, MD&A and other disclosure documents filed
on and available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov. Forward looking statements are not guarantees of future performance,
and actual results and future events could materially differ from those anticipated in such statements. All forward-looking statements
contained in this news release are qualified by these cautionary statements. New Gold expressly disclaims any intention or obligation
to update or revise any forward-looking statements whether as a result of new information, events or otherwise, except in accordance with
applicable securities laws.
Technical Information
The scientific and technical information relating
to the Mineral Reserves contained herein has been reviewed and approved by Andrew Croal, Director, Technical Services for the Company.
The scientific and technical information relating to the Mineral Resources contained herein has been reviewed and approved by Michele
Della Libera, Director, Exploration for the Company. All other scientific and technical information in this news release has been reviewed
and approved by Mr. Eric Vinet, Senior Vice President, Operations for the Company. Mr. Croal is a Professional Engineer and a member of
the Professional Engineers of Ontario. Mr. Della Libera is a Professional Geologist and a member of the Association of Professional Geoscientists
of Ontario and the Engineers and Geoscientists British Columbia. Mr. Vinet is a Professional Engineer and member of the Ordre des ingénieurs
du Québec. Mr. Croal, Mr. Della Libera and Mr. Vinet are "Qualified Persons" for the purposes of ("NI 43-101").
To the Company's knowledge, each of the aforementioned persons holds less than 1% of the outstanding securities of the Company.
View original content to download multimedia:https://www.prnewswire.com/news-releases/new-gold-reports-fourth-quarter-and-full-year-2021-results-provides-2022-operational-outlook-and-updated-mineral-reserves-and-mineral-resources-301488065.html
SOURCE New Gold Inc.
View original content to download multimedia: http://www.newswire.ca/en/releases/archive/February2022/23/c3038.html
%CIK: 0000800166
For further information: Ankit Shah, Vice President, Strategy &
Business Development, Direct: +1 (416) 324-6027, Email: ankit.shah@newgold.com; Brandon Throop, Director, Investor Relations, Direct:
+1 (647) 264-5027, Email: brandon.throop@newgold.com
CO: New Gold Inc.
CNW 06:30e 23-FEB-22
This regulatory filing also includes additional resources:
ex991.pdf
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