- Cash Balance of $31.2 Million
- Net Income of $4.0 Million, or $0.05 EPS
- Revenue of $45.4 Million
Gold Resource Corporation (NYSE American: GORO) (the “Company”)
sold a total of 8,381 ounces of gold and 265,407 ounces of silver
in Q 1 2022 for a gold equivalent total of 11,729 ounces.
Additionally, the Company sold 4,359 tonnes of zinc, 408 tonnes of
copper, and 1,639 tonnes of lead.
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Dry Stack Tailings Filtration Plant
(Photo: Business Wire)
Allen Palmiere, President and CEO, said, “Our operations
delivered excellent results during the first quarter 2022. Quarter
over quarter processing costs per tonne held steady despite a hyper
inflationary environment. Likewise, we reinvested $7.1 million into
exploration and infrastructure improvements at the Don David Gold
Mine during the quarter. Another $1.1 million was invested to
progress the feasibility study and permitting initiatives at the
Back Forty Project in Michigan. Our investments in both Mexico and
Michigan are focused on favorably impacting our environment, social
and governance programs while creating operational efficiencies and
longevity.”
Q1 2022 HIGHLIGHTS
Additional highlights for the first quarter ended March 31,
2022, are summarized below:
Strategic
- For the eighth consecutive year, the Don David Gold Mine earned
the prestigious Empresa Socialmente Responsable (“ESR”) award from
the Mexican Center for Philanthropy (CEMEFI). Awards are given to
organizations who demonstrate a commitment to supporting social and
environmental protection programs within their local
communities.
- During the quarter, the Company purchased and processed a
thousand tonnes of tailings material from a nearby community in an
effort to ensure the proper environmental treatment and storage of
the material.
- Patrick Frenette was hired as Vice President, Technical
Services and Steve Donohue was seconded as Vice President,
Environmental and Regulatory Affairs (Michigan) to further derisk
the successful delivery of the optimized feasibility study and
permit applications for the Back Forty Project.
- $0.9 million was distributed in shareholder dividends this
quarter, totaling $120.3 million since 2010.
Operational
- Two lost time incidents occurred during the quarter. Both
incidents were thoroughly investigated, and the appropriate actions
taken.
Financial
- Working capital was $32.4 million at March 31, 2022, $3.1
million higher than at December 31, 2021. The increase is primarily
due to an increase in accounts receivables as a result of higher
base metal prices and timing of shipments in March.
- Total cash cost for the quarter was $ (121) per gold equivalent
(“AuEq”) ounce (after co-product credits) and Total all-in
sustaining cost for the quarter was $499 per AuEq ounce (after
co-product credits). Both non-GAAP measures were favorably impacted
by co-product credits for base metals.1
Trending Highlights
2021
2022
Q1
Q2
Q3
Q4
Q1
Operating Data
Total tonnes milled
138,980
129,590
98,010
135,398
136,844
Average Grade
Gold (g/t)
1.68
1.93
2.68
1.93
3.00
Silver (g/t)
72
77
91
82
81
Copper (%)
0.43
0.36
0.37
0.38
0.41
Lead (%)
1.70
1.63
2.29
2.17
1.97
Zinc (%)
4.29
3.64
4.79
4.77
4.89
Metal production (before payable metal
deductions)
Gold (ozs.)
6,097
6,555
6,933
6,853
11,187
Silver (ozs.)
307,610
295,979
265,829
330,873
332,292
Copper (tonnes)
441
368
284
413
431
Lead (tonnes)
1,737
1,654
1,808
2,345
2,073
Zinc (tonnes)
4,377
3,683
3,920
5,349
5,562
Metal produced and sold
Gold (ozs.)
5,019
5,697
5,809
6,119
8,381
Silver (ozs.)
253,061
270,321
255,394
287,805
265,407
Copper (tonnes)
382
365
268
405
408
Lead (tonnes)
1,176
1,214
1,550
2,059
1,639
Zinc (tonnes)
3,134
3,193
3,059
4,167
4,359
Average metal prices realized
Gold ($ per oz.)
1,787
1,822
1,762
1,811
1,898
Silver ($ per oz.)
26.77
26.88
23.19
23.51
23.94
Copper ($ per tonne)
8,873
10,375
9,092
9,768
10,144
Lead ($ per tonne)
2,082
2,162
2,397
2,339
2,347
Zinc ($ per tonne)
2,797
2,945
3,032
3,466
3,842
Precious metal gold equivalent ounces
sold
Gold Ounces
5,019
5,697
5,809
6,119
8,381
Gold Equivalent Ounces from Silver
3,791
3,999
3,356
3,736
3,348
Total AuEq oz
8,810
9,696
9,165
9,855
11,729
Financial Data ($'s in thousands except
for per ounce)
Total sales, net
$ 27,268
$ 30,836
$ 29,029
$ 38,063
$ 45,417
Earnings from mining operations before
depreciation and amortization
11,974
11,259
11,766
17,744
25,281
Total cash cost after co-product credits
per AuEq oz sold
408
713
466
73
(121)
Total consolidated all-in sustaining cost
after co-product credits per AuEq oz sold
937
1,280
1,031
451
499
Production Costs
15,243
19,523
17,216
20,252
20,074
Production Costs/Tonnes Milled
110
151
176
150
147
Earnings before interest, taxes,
depreciation and amortization
8,520
7,413
7,402
10,304
15,328
Operating Cash Flows
6,831
9,298
5,743
12,911
4,230
Net income
2,527
1,283
1,529
2,689
4,019
Earnings per share - basic
$ 0.03
$ 0.02
$ 0.02
$ 0.03
$ 0.05
_____________________
1 See Management’s
Discussion and Analysis of Financial Condition and Results of
Operations – Non-GAAP Measures below for a reconciliation of
non-GAAP measures to applicable GAAP measures.
2022 Capital and Exploration Investment Summary
For the three months ended
March 31, 2022
2022 full year
guidance
(in thousands)
Sustaining Investments:
Underground Development
Capital
$
1,582
$
8.5 - 9.5 million
Infill Drilling and Exploration
Development
Capital
2,155
7.0 - 7.5 million
Other Sustaining Capital
Capital
859
4.0 - 4.5 million
Subtotal of Sustaining Investments:
4,596
Growth Investments:
DDGM growth:
Gold Regrind
Capital
571
-
Dry Stack Completion
Capital
782
-
Surface Exploration / Other
Exploration
730
2.5 – 3.0 million
Underground Exploration Drilling
Exploration
507
3.0 - 3.5 million
Back Forty growth:
Back Forty – Feasibility Study &
Permits
Exploration
1,068
8.0 -9.0 million
Subtotal of Growth Investments:
3,658
Total Capital and Exploration:
$
8,254
$
33.0 - 37.0 million
The Company’s investment in Mexico continued in Q1 2022 totaling
$7.1 million. Our investment in Mexico is focused on favorably
impacting our environment, social and governance programs while
creating operational efficiencies and longevity. Year-to-date at
the Back Forty Project, $1.1 million has been invested in
feasibility and permitting initiatives.
Gold Regrind Project: Regrinding of
the zinc tailings is expected to increase gold recovery by 6% to
10%. The reground material will be leached to produce doré bars.
Completion and commissioning are expected in Q2 2022. As of March
31, 2022, a total of $1.6 million has been invested in this
project, $1.1 million in 2021. Another $0.2 million is expected to
be spent before completion.
Dry Stack Tailings Project:
Construction of the water filtration plant and dry stack tailings
facilities was completed in 2021. During Q1 2022, work continued to
optimize the operations of the filtration plant. Through March
2022, 15,499 tons of tailings were processed through the plant. The
dry stack facilities will conserve and recirculate water, eliminate
risks related to traditional tailings facilities, accelerate
reclamation of certain areas of the open pit mine, and extend the
life of the operations. The dry-stacked tailings will accelerate
reclamation of certain areas of the open pit mine, extend the life
of the operations, and reduce water consumption as approximately
80% of the process water will be available for reuse. As of March
31, 2022, a total of $14.8 million has been invested in this
project, $14.0 million through 2021.
Underground and Exploration
Development: Mine development during the quarter included
ramps and accesses to different areas of the deposit and
exploration development drifts. A total of 1,094 meters of
development, at a cost of $2.4 million, was completed during the
quarter. Underground mine development was $1.6 million and
exploration development was $0.8 million (included in Infill
Drilling and Exploration Development in the table above). We plan
to invest a total of $8.5 million to $9.5 million in underground
development and an additional $4.0 million to $4.5 million in
exploration development in 2022.
Back Forty Feasibility and
Permitting: Work on the optimized feasibility study
progressed during Q1 2022. Current initiatives are focused on mine
planning and process plant design. Environmental considerations are
a key factor in the overall site layout and infrastructure
decisions being made. The feasibility study is expected to be
released the second half of 2022 followed by permit applications
being submitted with state agencies in Michigan.
Q1 2022 Conference Call
The Company will host a conference call tomorrow, Tuesday, May
10, 2022 at 11:00 a.m. Eastern Time.
The conference call will be recorded and posted to the Company’s
website later in the day following the conclusion of the call.
Following prepared remarks, Allen Palmiere, President and Chief
Executive Officer, Alberto Reyes, Chief Operating Officer and Kim
Perry, Chief Financial Officer will host a live question and answer
(Q&A) session. There are two ways to join the conference
call.
To join the conference via webcast, please click on the
following link: https://app.webinar.net/DG5l9rQ3r7X
To join the call via telephone, please use the following dial-in
details: Participant Toll Free: (888) 440-2094 International: (438)
803-0544 Conference ID: 2818458
Please connect to the conference call at least 10 minutes prior
to the start time using one of the connection options listed
above.
About GRC:
Gold Resource Corporation is a gold and silver producer,
developer, and explorer with its operations centered on the Don
David Gold Mine in Oaxaca, Mexico. Under the direction of an
experienced board and senior leadership team, the company’s focus
is to unlock the significant upside potential of its existing
infrastructure and large land position surrounding the mine in
Oaxaca, Mexico and to develop the Back Forty Project in Michigan,
USA. For more information, please visit GRC’s website, located at
www.goldresourcecorp.com and read the company’s Form 10-K for an
understanding of the risk factors associated with its business.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220509006193/en/
Kim Perry Chief Financial Officer Kim.Perry@GRC-USA.com
www.GoldResourcecorp.com
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