Alamos Gold Inc. (
TSX:AGI;
NYSE:AGI) (“Alamos” or the “Company”) today reported its
financial results for the third quarter ended September 30, 2018
and reviewed its operating, exploration and development activities.
“We made excellent progress in the third quarter
towards both our near and long-term objectives. We met our
quarterly production guidance and remain well positioned to achieve
full year guidance. We completed the Phase I expansion at Island
Gold on schedule and are having ongoing success on the exploration
front which has translated into significant Mineral Reserve and
Resource growth in the year since we acquired the mine. We’re
also advancing on the lower mine expansion at Young-Davidson which
will unlock the full potential of the mine and drive
significant free cash flow growth,” said John A. McCluskey,
President and Chief Executive Officer.
Third Quarter 2018
Highlights
- Produced 124,000 ounces of gold, consistent with quarterly
guidance of 120,000 to 125,000 ounces, and 16% above the third
quarter of 2017, reflecting the inclusion of production from Island
Gold
- Gold production for the first nine months of 2018 achieved a
record 379,400 ounces, a 23% increase from the same period in 2017.
The Company remains well positioned to achieve full-year production
guidance of 490,000 to 530,000 ounces
- Sold 119,401 ounces of gold in the third quarter at an average
realized price of $1,229 per ounce, $16 per ounce above the average
London PM Fix, for revenues of $146.7 million. Revenues declined
relative to the second quarter reflecting lower gold sales and a
$78 per ounce decline in the realized gold price
- Cost of sales of $1,152 per ounce, total cash costs1 of $817
per ounce and all-in sustaining costs ("AISC")1 of $1,048 per ounce
were higher than full year guidance reflecting lower mining rates
at Young-Davidson, higher costs at El Chanate and planned higher
sustaining capital at Island Gold
- Given higher than budgeted costs at Young-Davidson and El
Chanate through the first nine months of 2018, the Company is
revising its full year consolidated total cash cost guidance from
$740 to $810 per ounce and AISC guidance from $950 to $990 per
ounce
- Realized net earnings of $7.2 million, or $0.02 per share
- Reported an adjusted net loss1 of $1.9 million or $0.00 per
share1, primarily reflecting adjustments for unrealized foreign
exchange gains recorded within both deferred taxes and foreign
exchange of $8.7 million
- Generated cash flow from operating activities of $45.2 million
($41.6 million, or $0.11 per share, before changes in working
capital1), a decrease from the second quarter primarily reflecting
a lower realized gold price and lower gold sales
- Ended the quarter with no debt and cash and cash equivalents of
$224.8 million
- Announced a significant increase in Mineral Reserves and
Resources at Island Gold as of June 30, 2018
- Successfully commissioned the Phase I expansion at Island Gold
on schedule, increasing mill capacity to 1,100 tonnes per day
- Paid a semi-annual dividend of $0.01 per common share, or $3.9
million, to shareholders on October 30, 2018, representing the
Company's 18th consecutive semi-annual dividend
(1) |
Refer to
the “Non-GAAP Measures and Additional GAAP Measures” disclosure at
the end of this press release and associated MD&A for a
description and calculation of these measures. |
|
|
Highlight Summary
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Financial Results (in millions) |
|
|
|
|
Operating revenues |
$146.7 |
|
$128.8 |
|
$488.7 |
|
$381.1 |
|
Cost of sales (1) |
$137.6 |
|
$100.6 |
|
$432.3 |
|
$320.2 |
|
Earnings from operations |
$0.6 |
|
$20.9 |
|
$28.7 |
|
$38.9 |
|
Net earnings (loss) |
$7.2 |
|
$28.8 |
|
($1.1 |
) |
$31.3 |
|
Adjusted net (loss) earnings (2) |
($1.9 |
) |
$13.7 |
|
$15.3 |
|
$18.4 |
|
Cash provided by operations before working capital and cash
taxes(2) |
$41.6 |
|
$51.3 |
|
$158.9 |
|
$130.6 |
|
Cash provided by operating activities |
$45.2 |
|
$43.4 |
|
$166.5 |
|
$114.9 |
|
Capital expenditures (sustaining) (2) |
$19.6 |
|
$10.8 |
|
$42.4 |
|
$31.2 |
|
Capital expenditures (growth) (2) |
$30.5 |
|
$26.2 |
|
$102.8 |
|
$86.2 |
|
Capital expenditures (capitalized exploration) (3) |
$5.0 |
|
$1.2 |
|
$14.8 |
|
$5.9 |
|
Operating Results |
|
|
|
|
Gold
production (ounces) (4) |
|
124,000 |
|
|
107,000 |
|
|
379,400 |
|
|
309,100 |
|
Gold
sales (ounces) |
|
119,401 |
|
|
100,551 |
|
|
378,718 |
|
|
303,329 |
|
Per Ounce Data |
|
|
|
|
Average realized gold price |
$1,229 |
|
$1,281 |
|
$1,290 |
|
$1,256 |
|
Average spot gold price (London PM Fix) |
$1,213 |
|
$1,278 |
|
$1,282 |
|
$1,251 |
|
Cost of sales per ounce of gold sold (includes amortization)
(1) |
$1,152 |
|
$1,000 |
|
$1,141 |
|
$1,056 |
|
Total cash costs per ounce of gold sold (2) |
$817 |
|
$720 |
|
$813 |
|
$777 |
|
All-in sustaining costs per ounce of gold sold (2) |
$1,048 |
|
$884 |
|
$992 |
|
$946 |
|
Share Data |
|
|
|
|
Earnings
per share, basic |
$0.02 |
|
$0.10 |
|
$0.00 |
|
$0.11 |
|
Adjusted
earnings per share, basic (2) |
$0.00 |
|
$0.05 |
|
$0.04 |
|
$0.06 |
|
Weighted
average common shares outstanding (basic) (000’s) |
|
389,854 |
|
|
300,448 |
|
|
389,572 |
|
|
294,853 |
|
Financial Position (in millions) |
|
|
|
|
Cash and
cash equivalents (5) |
|
|
$224.8 |
|
$200.8 |
|
(1) |
Cost of
sales includes mining and processing costs, royalties, and
amortization expense. |
(2) |
Refer to
the “Non-GAAP Measures and Additional GAAP Measures” disclosure at
the end of this press release and associated MD&A for a
description and calculation of these measures. |
(3) |
Includes
capitalized exploration at Mulatos and Island Gold. |
(4) |
Gold
production from Island Gold has been included in this table for the
period subsequent to November 23, 2017 only. Gold production from
Island Gold for the three and nine months ended September 30, 2017
was 26,659 and 76,541 ounces respectively. |
(5) |
Comparative
Cash and cash equivalents balance as at December 31, 2017. |
|
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
(1) |
|
2018 |
|
|
2017 |
(1) |
Gold production (ounces) |
|
|
|
|
Young-Davidson |
|
49,000 |
|
|
55,800 |
|
|
129,100 |
|
|
143,500 |
|
Mulatos |
|
43,300 |
|
|
36,300 |
|
|
139,900 |
|
|
117,300 |
|
Island Gold (1) |
|
22,000 |
|
|
— |
|
|
76,800 |
|
|
— |
|
El Chanate |
|
9,700 |
|
|
14,900 |
|
|
33,600 |
|
|
48,300 |
|
Gold sales (ounces) |
|
|
|
|
Young-Davidson |
|
46,853 |
|
|
55,267 |
|
|
133,649 |
|
|
145,462 |
|
Mulatos |
|
42,300 |
|
|
30,330 |
|
|
136,285 |
|
|
109,270 |
|
Island Gold (1) |
|
20,561 |
|
|
— |
|
|
75,321 |
|
|
— |
|
El Chanate |
|
9,687 |
|
|
14,954 |
|
|
33,463 |
|
|
48,597 |
|
Cost of sales (in millions)(2) |
|
|
|
|
Young-Davidson |
$59.8 |
|
$53.4 |
|
$173.5 |
|
$155.3 |
|
Mulatos |
$41.9 |
|
$29.0 |
|
$134.7 |
|
$105.3 |
|
Island Gold (1) |
$22.3 |
|
|
— |
|
$77.8 |
|
|
— |
|
El Chanate |
$13.6 |
|
$18.2 |
|
$46.3 |
|
$59.6 |
|
Cost of sales per ounce of gold sold (includes
amortization) |
|
|
|
Young-Davidson |
$1,276 |
|
$966 |
|
$1,298 |
|
$1,068 |
|
Mulatos |
$991 |
|
$956 |
|
$988 |
|
$964 |
|
Island Gold (1) |
$1,085 |
|
|
— |
|
$1,033 |
|
|
— |
|
El Chanate |
$1,404 |
|
$1,217 |
|
$1,384 |
|
$1,226 |
|
Total cash costs per ounce of gold sold (3) |
|
|
|
|
Young-Davidson |
$824 |
|
$572 |
|
$845 |
|
$647 |
|
Mulatos |
$771 |
|
$785 |
|
$784 |
|
$782 |
|
Island Gold (1) |
$671 |
|
|
— |
|
$597 |
|
|
— |
|
El Chanate |
$1,301 |
|
$1,137 |
|
$1,285 |
|
$1,156 |
|
Mine-site all-in sustaining costs per ounce of gold sold
(3),(4) |
|
|
|
Young-Davidson |
$1,029 |
|
$744 |
|
$1,034 |
|
$824 |
|
Mulatos |
$846 |
|
$864 |
|
$847 |
|
$852 |
|
Island Gold (1) |
$1,051 |
|
|
— |
|
$759 |
|
|
— |
|
El Chanate |
$1,332 |
|
$1,164 |
|
$1,312 |
|
$1,187 |
|
Capital
expenditures (sustaining, growth and capitalized exploration) (in
millions)(3) |
|
|
Young-Davidson |
$22.1 |
|
$22.0 |
|
$63.5 |
|
$63.3 |
|
Mulatos(5) |
$6.8 |
|
$8.9 |
|
$23.5 |
|
$34.9 |
|
Island Gold (1),(6) |
$17.8 |
|
|
— |
|
$49.3 |
|
|
— |
|
El Chanate |
$0.2 |
|
$0.3 |
|
$0.5 |
|
$1.2 |
|
Other |
$8.2 |
|
$7.0 |
|
$23.2 |
|
$23.9 |
|
(1) |
Operating
and financial results from Island Gold are included in Alamos’
consolidated financial statements for the period subsequent to
November 23, 2017. Gold production from Island Gold for the three
and nine months ended September 30, 2017 was 26,659 and 76,541
ounces, respectively. |
(2) |
Cost of
sales includes mining and processing costs, royalties and
amortization. |
(3) |
Refer to
the “Non-GAAP Measures and Additional GAAP Measures” disclosure at
the end of this press release and associated MD&A for a
description and calculation of these measures. |
(4) |
For the
purposes of calculating mine-site all-in sustaining costs, the
Company does not include an allocation of corporate and
administrative and share based compensation expenses. |
(5) |
Includes
capitalized exploration at Mulatos of $0.3 million and $2.3 million
for the three and nine months ended September 30, 2018 ($1.2
million and $5.9 million for the three and nine months ended
September 30, 2017). |
(6) |
Includes
capitalized exploration at Island Gold of $4.7 million and $12.5
million for the three and nine months ended September 30,
2018. |
|
|
Outlook and Strategy
|
2018
Guidance |
Total |
|
Young-Davidson |
Mulatos |
IslandGold |
ElChanate |
Turkey (5) |
Other (2) |
Original |
Current |
Gold
production (000’s ounces) |
|
|
|
|
|
|
|
|
Current Guidance |
180-190 |
170-180 |
100-110 |
40-50 |
— |
— |
|
490-530 |
Original Guidance |
200-210 |
150-160 |
90-100 |
40-50 |
— |
— |
480-520 |
|
Cost of sales,
including amortization
(in millions)(4),(6) |
$208 |
$175 |
$108 |
$58 |
— |
— |
$536 |
$549 |
Cost of sales, including amortization
($ per ounce)(4),(6) |
$1,125 |
$1,000 |
$1,025 |
$1,285 |
— |
— |
$1,075 |
$1,145 |
Total cash
costs ($ per ounce)(1),(6) |
$675 |
$800 |
$575 |
$1,200 |
— |
— |
$740 |
$810 |
All-in sustaining costs ($ per
ounce)(1),(6) |
|
|
|
|
— |
— |
$950 |
$990 |
Mine-site
all-in sustaining costs ($ per
ounce)(1),(3),(6) |
$850 |
$900 |
$825 |
$1,200 |
— |
— |
— |
— |
Amortization costs ($ per ounce)(1) |
$450 |
$200 |
$450 |
$85 |
— |
— |
$335 |
$335 |
Capital
expenditures (in millions) |
|
|
|
|
|
|
|
|
Sustaining capital(1) |
$35-40 |
$8-10 |
$25-27 |
— |
— |
— |
$68-77 |
$68-77 |
Growth capital(1) |
$35-40 |
$18-20 |
$25-28 |
— |
$25 |
$46 (2) |
$224-234 |
$149-159 |
Total capital expenditures(1) |
$70-80 |
$26-30 |
$50-55 |
— |
$25 |
$46 |
$292-$311 |
$217-$236 |
(1) |
Refer to
the "Non-GAAP Measures and Additional GAAP" disclosure at the end
of this press release and associated MD&A for a description of
these measures. |
(2) |
Includes
capitalized exploration at all operating sites and development
projects. |
(3) |
For the
purposes of calculating mine-site all-in sustaining costs at
individual mine sites, the Company does not include an allocation
of corporate and administrative and share based compensation
expenses to the mine sites. |
(4) |
Cost of
sales includes mining and processing costs, royalties, and
amortization expense, and is calculated based on the mid-point of
guidance. |
(5) |
Capital
guidance at Kirazlı has been reduced to $25 million from the
original budget of $100 million. |
(6) |
Company-wide cost of sales, total cash costs, and all-in sustaining
costs guidance have been updated from original guidance. The
Company has not revised guidance for cost of sales, total cash
costs, and mine-site all-in sustaining costs at individual mine
sites. |
|
|
The Company continues to deliver on its strategic objectives of
increasing cash flow from operations while advancing its portfolio
of low-cost development projects. Gold production in the third
quarter of 124,000 ounces was at the top end of the Company’s
forecast of between 120,000 and 125,000 ounces, and represented a
16% increase relative to the third quarter of 2017, reflecting the
inclusion of production from Island Gold. With record production of
379,400 ounces through the first nine months of 2018, the Company
is well positioned to achieve full year production guidance of
490,000 to 530,000 ounces, which was increased earlier in the
year.
Gold production in the fourth quarter is
expected to increase slightly relative to the third quarter at
lower total cash costs and AISC, bringing full-year production
above 500,000 ounces. The reduction in costs is expected to be
driven by higher grades and throughput at both Young-Davidson and
Island Gold.
Total cash costs of $817 per ounce and AISC of
$1,048 per ounce were higher than budget in the third quarter,
driven primarily by higher costs at Young-Davidson and El Chanate,
as well as planned higher sustaining capital at Island Gold. As a
result of higher than budgeted costs at Young-Davidson and El
Chanate through the first three quarters, the Company has increased
2018 total cash cost guidance from $740 to $810 per ounce, and AISC
guidance from $950 to $990 per ounce. The Company expects lower
costs in 2019.
Young-Davidson produced 49,000 ounces in the
third quarter, a 25% increase from the second quarter. The
operation is on track to achieve revised guidance of between
180,000 and 190,000 ounces for the year.
The near-term focus at Young-Davidson remains on
maximizing efficiency from the upper mine infrastructure, while
completing development and construction of the lower mine. The
upper mine infrastructure was designed for 6,000 tpd and has been
operated at up to 7,200 tpd in the fourth quarter of 2017, but has
averaged 6,500 tpd over the past two years. The lower mine
infrastructure, which will be used over the long term, is designed
for 8,000 tpd. Construction of the lower mine and tie-in to the
upper mine is scheduled to be completed in the first half of
2020.
Young-Davidson is expected to be operating from
the lower mine in the second half of 2020, after which higher
underground mining rates will drive production higher and operating
costs lower. Combined with a significant reduction in capital, this
will result in substantial free cash flow growth. Until such time,
gold production, operating costs and capital spending are expected
to remain at levels consistent with the past two years.
Young-Davidson has generated $48 million of positive free cash flow
over the past two years and will continue to fund the lower mine
construction from operating cash flow.
Island Gold produced 22,000 ounces in the third
quarter, consistent with budget. With year-to-date production of
76,800 ounces, the operation is well positioned to meet its 2018
production guidance of between 100,000 and 110,000 ounces, an 11%
increase from original guidance (based on the mid-point).
The Phase I expansion of the Island Gold mill to
1,100 tpd was completed on schedule in September. The mill was
successfully commissioned with throughput increasing to
average approximately 1,100 tpd in September and October. Higher
milling rates and grades are expected to drive stronger production
and lower costs in 2019 and beyond. The Company expects a 30%
increase in gold production and significant free cash flow growth
at Island Gold in 2019.
Exploration results at Island Gold continue to
exceed expectations with a significant increase in Mineral Reserves
and Resources announced in the third quarter of 2018. Since the
acquisition of Island Gold in November 2017, Mineral Reserves have
increased 365,000 ounces, before mining depletion, with Mineral
Reserve grades also increasing 17% to 10.69 g/t Au as the deposit
continues to grow in size and quality. Measured and Indicated
Mineral Resources have also increased 130,000 ounces while Inferred
Mineral Resources have increased 184,000 ounces. Ongoing
exploration success will be incorporated into an evaluation of the
most effective and economic approach to a further expansion of the
operation beyond 1,100 tpd.
Total production from the Mulatos district
(including La Yaqui Phase I) was 43,300 ounces in the third
quarter, exceeding budget for the third consecutive quarter.
Production decreased from the second quarter of 2018 as expected,
with underground mining at San Carlos coming to an end. With
year-to-date production of 139,900 ounces, Mulatos is well
positioned to meet its increased 2018 production guidance of
between 170,000 and 180,000 ounces, representing a 13% increase
from the mid-point of original guidance. The Company expects 2019
production to return to the previously guided range of 150,000 to
160,000 ounces per year.
El Chanate produced 9,700 ounces in the third
quarter, and remains on track to meet production guidance of 40,000
to 50,000 ounces for the full year. This is down from 2017
reflecting lower mining rates with mining activities having ceased
on October 30, 2018. Given the long leach cycle at El Chanate, the
Company expects to benefit from ongoing gold production beyond 2018
through residual leaching.
The Company expects combined annual gold
production of approximately 500,000 ounces in 2019 and 2020 with
low cost production growth from Island Gold replacing higher cost
production from El Chanate. Consolidated all-in sustaining costs
are expected to decrease in 2019 reflecting the completion of the
Phase I expansion at Island Gold and the end of the 5% royalty at
Mulatos, with a further decline expected following the completion
of the lower mine tie-in at Young-Davidson in 2020.
On July 25, 2018, the Company was granted the
GSM (Business Opening and Operation) permit required for the
construction of its Kirazlı project. To date, construction has been
focused on the infrastructure projects required to support the mine
development. The Company now estimates spending $25 million in
2018. This is down from the previous estimate as the Company
delayed finalization of the mining services and earthworks contract
pending clarity on recent amendments to a decree in Turkey
requiring that certain contracts be denominated in Turkish Lira.
The Company has now assessed the applicability of these changes and
believes this decree is applicable to our mining services and
earthworks contract. This contract is now being finalized, with
construction activities expected to ramp up through the end of this
year. The remainder of the $152 million initial capital budget for
Kirazlı is expected to be spent in 2019 and 2020, with first
production expected in the second half of 2020.
In addition to capital spending in Turkey, the
Company has invested $5.2 million in development expenditures at
Cerro Pelon, La Yaqui Grande and Lynn Lake thus far in 2018.
Exploration spending of $27.0 million to date has been focused
primarily at Island Gold.
With over $625 million of cash and available
liquidity, no debt, and growing cash flow from its operations, the
Company is well positioned to fund its growth.
Young-Davidson Financial and Operational
Review
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Gold production (ounces) |
|
49,000 |
|
|
55,800 |
|
|
129,100 |
|
|
143,500 |
|
Gold
sales (ounces) |
|
46,853 |
|
|
55,267 |
|
|
133,649 |
|
|
145,462 |
|
Financial
Review (in millions) |
|
|
|
|
Operating Revenues |
$57.3 |
|
$70.8 |
|
$171.9 |
|
$182.9 |
|
Cost of sales (1) |
$59.8 |
|
$53.4 |
|
$173.5 |
|
$155.3 |
|
(Loss) earnings from
operations |
($2.5 |
) |
$17.4 |
|
($1.6 |
) |
$27.6 |
|
Cash provided by
operating activities |
$24.0 |
|
$35.3 |
|
$73.9 |
|
$81.1 |
|
Capital expenditures
(sustaining) (2) |
$9.5 |
|
$9.4 |
|
$25.0 |
|
$25.4 |
|
Capital expenditures
(growth) (2) |
$12.6 |
|
$12.6 |
|
$38.5 |
|
$37.9 |
|
Mine-site free cash
flow (2) |
$1.9 |
|
$13.3 |
|
$10.4 |
|
$17.8 |
|
Cost of sales, including amortization per ounce of gold sold
(1) |
$1,276 |
|
$966 |
|
$1,298 |
|
$1,068 |
|
Total
cash costs per ounce of gold sold (2) |
$824 |
|
$572 |
|
$845 |
|
$647 |
|
Mine-site
all-in sustaining costs per ounce of gold sold (2),(3) |
$1,029 |
|
$744 |
|
$1,034 |
|
$824 |
|
Underground
Operations |
|
|
|
|
Tonnes of
ore mined |
|
552,500 |
|
|
602,072 |
|
|
1,691,443 |
|
|
1,758,442 |
|
Tonnes of
ore mined per day ("tpd") |
|
6,005 |
|
|
6,544 |
|
|
6,196 |
|
|
6,441 |
|
Average
grade of gold (4) |
|
2.59 |
|
|
2.89 |
|
|
2.44 |
|
|
2.69 |
|
Metres
developed |
|
2,811 |
|
|
3,344 |
|
|
9,034 |
|
|
10,011 |
|
Mill Operations |
|
|
|
|
Tonnes of
ore processed |
|
670,912 |
|
|
694,900 |
|
|
1,938,395 |
|
|
2,018,994 |
|
Tonnes of
ore processed per day |
|
7,293 |
|
|
7,553 |
|
|
7,100 |
|
|
7,396 |
|
Average
grade of gold (4) |
|
2.43 |
|
|
2.65 |
|
|
2.28 |
|
|
2.43 |
|
Contained
ounces milled |
|
52,517 |
|
|
59,230 |
|
|
140,509 |
|
|
157,623 |
|
Average recovery rate |
|
93 |
% |
|
93 |
% |
|
92 |
% |
|
91 |
% |
(1) |
Cost of
sales includes mining and processing costs, royalties and
amortization. |
(2) |
Refer to
the “Non-GAAP Measures and Additional GAAP Measures” disclosure at
the end of this press release and associated MD&A for a
description and calculation of these measures. Total cash
costs and mine-site AISC are exclusive of net-realizable value
adjustments. |
(3) |
For the
purposes of calculating mine-site all-in sustaining costs, the
Company does not include an allocation of corporate and
administrative and share based compensation expenses. |
(4) |
Grams per
tonne of gold ("g/t Au"). |
|
|
Young-Davidson produced 49,000 ounces of gold in the third
quarter of 2018, lower than the comparative quarter of 2017;
however, a 25% improvement from the second quarter of 2018 driven
by higher milling rates and underground grades mined. This
improvement has continued into October with production of 18,000
ounces for the month driven by higher grades and underground mining
rates.
Underground mining rates of 6,005 tpd were below
budgeted levels in the third quarter. During the second quarter
mill shutdown, underground ore was stockpiled, which was
subsequently processed, and supplemented ore mined in the quarter.
During July, mining rates were impacted by forest fires in
proximity to the mine which impacted air quality and resulted in
cancelled shifts and three days of downtime. In addition, power
outages due to extreme weather caused another two days of downtime
to both the mine and mill. This downtime impacted mining rates by
approximately 400 tpd over the quarter. Mining rates improved in
the latter part of the quarter and in October to average 6,500 tpd.
Underground mining rates are expected to increase substantially
following the completion of the lower mine tie-in in 2020.
Underground grades mined of 2.59 g/t Au for the
third quarter increased 10% from the second quarter of 2018. The
Company expects a further improvement in grades mined in the fourth
quarter.
During the third quarter, 670,912 tonnes, or
7,293 tpd, were processed through the mill with grades averaging
2.43 g/t Au, representing a 12% increase from the second quarter of
2018. Mill throughput was below budgeted levels, primarily due to
the mill shutdown in the early part of the quarter.
Mill recoveries of 93% were in line with
expectations and the prior year period.
The Company remains on track to meet the updated
production guidance at Young-Davidson of between 180,000 and
190,000 ounces, with the fourth quarter expected to be the
strongest of the year.
Financial Review
For the third quarter ended September 30, 2018,
revenues of $57.3 million were $13.5 million lower than the
comparative quarter, due to lower ounces sold and a lower realized
gold price. Year-to-date 2018 revenues of $171.9 million were $11.0
million lower than the prior year with lower ounces sold partially
offset by a higher realized gold price.
Cost of sales, which reflects mining and
processing costs, royalties, and amortization expense of $59.8
million were higher than the comparative quarter of 2017 reflecting
higher mining and processing costs. Year-to-date cost of sales were
$173.5 million, an increase of $18.2 million due to higher mining
and processing costs and amortization charges.
Total cash costs in the third quarter were $824
per ounce, a 44% increase from the third quarter of 2017 due to
lower grades processed and a higher mining cost per tonne.
Mining costs of CAD $54 per tonne in the quarter were above budget,
reflecting the impact of lower throughput on fixed costs, as well
as higher diesel and maintenance costs. Total cash costs of $845
per ounce for the nine-month period were 31% higher than the prior
year period.
Mine-site AISC were $1,029 per ounce in the
third quarter, 38% higher than the prior year quarter reflecting
higher total cash costs and higher sustaining capital.
Mine-site AISC for the nine-month period were $1,034 or 25% higher
than the prior year period. Mine-site AISC have been above guidance
throughout 2018 as a result of higher per-unit mining and milling
costs, as well as the impact of higher sustaining capital on lower
ounce production.
Capital expenditures were $22.1 million in the
third quarter, including $9.5 million for sustaining capital and
$12.6 million for growth capital, consistent with the same quarter
of 2017. Major capital spending during the quarter included lateral
development in the upper and lower mines, as well as expenditures
on the water treatment plant. Capital expenditures of $63.5 million
for the nine-month period were consistent with the prior year
period and guidance.
Young-Davidson generated mine-site free cash
flow of $1.9 million in the third quarter, lower than the prior
year quarter, primarily due to lower gold sales and gross margins.
Year-to-date free cash flow of $10.4 million was lower due to gold
sales and higher costs.
Island Gold Financial and Operational
Review
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 (1) |
|
|
2018 |
|
|
2017 (1) |
|
Gold production (ounces)
(1) |
|
22,000 |
|
|
— |
|
|
76,800 |
|
|
— |
|
Gold sales (ounces)
(1) |
|
20,561 |
|
|
— |
|
|
75,321 |
|
|
— |
|
Financial Review (in millions) |
|
|
|
|
Operating Revenues |
$25.3 |
|
|
$— |
|
$97.6 |
|
|
$— |
|
Cost of sales (2) |
$22.3 |
|
|
$— |
|
$77.8 |
|
|
$— |
|
Earnings from
operations |
$2.7 |
|
|
$— |
|
$19.4 |
|
|
$— |
|
Cash provided by
operating activities |
$13.9 |
|
|
$— |
|
$59.6 |
|
|
$— |
|
Capital expenditures
(sustaining) (3) |
$7.8 |
|
|
$— |
|
$12.2 |
|
|
$— |
|
Capital expenditures
(growth) (3) |
$5.3 |
|
|
$— |
|
$24.6 |
|
|
$— |
|
Capital expenditures
(capitalized exploration) (3) |
$4.7 |
|
|
$— |
|
$12.5 |
|
|
$— |
|
Mine-site free cash
flow (3) |
($3.9 |
) |
|
$— |
|
$10.3 |
|
|
$— |
|
Cost of sales, including amortization per ounce of gold sold
(2) |
$1,085 |
|
|
$— |
|
$1,033 |
|
|
$— |
|
Total
cash costs per ounce of gold sold (3) |
$671 |
|
|
$— |
|
$597 |
|
|
$— |
|
Mine-site
all-in sustaining costs per ounce of gold sold (3),(4) |
$1,051 |
|
|
$— |
|
$759 |
|
|
$— |
|
Underground
Operations |
|
|
|
|
Tonnes of
ore mined |
|
74,892 |
|
|
84,405 |
|
|
241,644 |
|
|
280,555 |
|
Tonnes of
ore mined per day ("tpd") |
|
814 |
|
|
917 |
|
|
885 |
|
|
1,028 |
|
Average
grade of gold (5) |
|
8.96 |
|
|
9.16 |
|
|
9.12 |
|
|
9.41 |
|
Metres
developed |
|
1,591 |
|
|
1,383 |
|
|
4,917 |
|
|
5,239 |
|
Mill Operations |
|
|
|
|
Tonnes of
ore processed |
|
93,454 |
|
|
85,101 |
|
|
264,335 |
|
|
254,044 |
|
Tonnes of
ore processed per day |
|
1,016 |
|
|
925 |
|
|
968 |
|
|
931 |
|
Average
grade of gold (5) |
|
8.22 |
|
|
10.04 |
|
|
9.27 |
|
|
9.65 |
|
Contained
ounces milled |
|
24,708 |
|
|
27,470 |
|
|
78,793 |
|
|
78,818 |
|
Average recovery rate |
|
96 |
% |
|
97 |
% |
|
97 |
% |
|
97 |
% |
(1) |
Financial
results from Island Gold are included in Alamos’ consolidated
financial statements for the period subsequent to November 23,
2017. Gold production from Island Gold for the three and
nine-months ended September 30, 2017 was 26,659 and 76,541
ounces. |
(2) |
Cost of
sales includes mining and processing costs, royalties and
amortization. |
(3) |
Refer to
the “Non-GAAP Measures and Additional GAAP Measures” disclosure at
the end of this press release and associated MD&A for a
description and calculation of these measures. Total cash
costs and mine-site AISC are exclusive of net-realizable value
adjustments. |
(4) |
For the
purposes of calculating mine-site all-in sustaining costs, the
Company does not include an allocation of corporate and
administrative and share based compensation expenses. |
(5) |
Grams per
tonne of gold ("g/t Au"). |
|
|
Island Gold produced 22,000 ounces in the third
quarter bringing year-to-date production to 76,800 ounces, well
ahead of budget. The Company remains well positioned to achieve
2018 production guidance of 100,000 to 110,000 ounces which was
increased earlier in the year from original guidance of 90,000 to
100,000 ounces.
Underground mining rates in the third quarter of
74,892 tonnes or 814 tpd were impacted by low contractor production
drilling performance, as well as a scheduled one-week shutdown of
the ramp. Underground mining rates improved later in the quarter,
averaging approximately 1,100 tpd in September as well as October
and are expected to remain at similar levels going forward, to
match the expanded mill capacity. Underground grades mined of 8.96
g/t Au were higher than the second quarter and slightly above
budget.
Mill throughput for the third quarter was 93,454
tonnes, or 1,016 tpd, an increase from 976 tpd in the second
quarter and 925 tpd in the prior year quarter. The Phase I
expansion was completed and commissioned during the month of
September, with October mill throughput averaging over 1,100 tpd.
Milled grades averaged 8.22 g/t Au, 18% lower than the prior year
quarter, but consistent with the budget.
Financial Review
With the Company acquiring Island Gold on
November 23, 2017, financial information prior to the acquisition
date has not been included in the comparative table above.
Island Gold generated revenues of $25.3 million
in the third quarter, lower than the first two quarters of 2018,
resulting from lower ounces sold during the quarter. Revenues for
the nine-month period were $97.6 million.
Cost of sales in the third quarter and
nine-month period were $22.3 million and $77.8 million,
respectively. Cost of sales includes ongoing amortization charges
related to the purchase price of the asset, which increases
amortization to approximately $450 per ounce based on current
Mineral Reserves and Resources.
Total cash costs of $671 per ounce were higher
than the prior quarter, reflecting lower tonnes mined and lower
grades. On a year-to-date basis, total cash costs of $597 per ounce
are in-line with annual guidance of $575 per ounce. Total cash
costs are expected to decrease in the fourth quarter reflecting
higher milled grades and mining rates.
Mine-site AISC of $1,051 per ounce were also
higher than annual guidance of $825 primarily reflecting lower
ounces sold during the quarter, and the timing of sustaining
capital, as spending was well below budget for the first half of
the year. Full year mine-site AISC of $759 per ounce remains below
full year guidance.
Capital expenditures totaled $17.8 million in
the third quarter, with spending focused primarily on lateral
development, mining equipment, completion of the mill expansion, as
well as capitalized exploration. Total capital expenditures in the
third quarter included $7.8 million of sustaining capital and $10.0
million of growth capital (inclusive of capitalized exploration).
Year-to-date capital expenditures totaled $49.3 million, including
capitalized exploration, and are expected to be in line with
guidance for the full year.
Mine-site free cash flow was negative $3.9
million during the third quarter due to timing of capital spending.
On a year-to-date basis, Island Gold has generated mine-site free
cash flow of $10.3 million driven by stronger than budgeted
production and operating margins.
Mulatos Financial and Operational
Review
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Gold production (ounces) |
|
43,300 |
|
|
36,300 |
|
|
139,900 |
|
|
117,300 |
|
Gold
sales (ounces) |
|
42,300 |
|
|
30,330 |
|
|
136,285 |
|
|
109,270 |
|
Financial
Review (in millions) |
|
|
|
|
Operating Revenues |
$51.5 |
|
$38.9 |
|
$175.2 |
|
$137.4 |
|
Cost of sales (1) |
$41.9 |
|
$29.0 |
|
$134.7 |
|
$105.3 |
|
Earnings from
operations |
$8.0 |
|
$7.6 |
|
$33.9 |
|
$27.2 |
|
Cash provided by
operating activities |
$16.1 |
|
$13.1 |
|
$56.3 |
|
$42.0 |
|
Capital expenditures
(sustaining) (2) |
$2.1 |
|
$1.1 |
|
$4.7 |
|
$4.6 |
|
Capital expenditures
(growth) (2) |
$4.4 |
|
$4.9 |
|
$16.5 |
|
$11.9 |
|
Capital expenditures
(capitalized exploration) (2) |
$0.3 |
|
$1.2 |
|
$2.3 |
|
$5.9 |
|
La Yaqui Phase I
construction cost (2) |
|
$— |
|
$1.7 |
|
|
$— |
|
$12.5 |
|
Mine-site free cash
flow, excluding La Yaqui construction costs (2) |
$9.3 |
|
$5.9 |
|
$32.8 |
|
$19.6 |
|
Cost of sales, including amortization per ounce of gold sold
(1) |
$991 |
|
$956 |
|
$988 |
|
$964 |
|
Total
cash costs per ounce of gold sold (2) |
$771 |
|
$785 |
|
$784 |
|
$782 |
|
Mine site
all-in sustaining costs per ounce of gold sold (2),(3) |
$846 |
|
$864 |
|
$847 |
|
$852 |
|
Open Pit &
Underground Operations |
|
|
|
|
Tonnes of
ore mined - open pit (4) |
|
1,904,534 |
|
|
2,340,817 |
|
|
6,360,911 |
|
|
5,910,627 |
|
Total
waste mined - open pit |
|
1,108,953 |
|
|
1,461,098 |
|
|
4,958,609 |
|
|
4,723,985 |
|
Total
tonnes mined - open pit |
|
3,490,021 |
|
|
4,217,795 |
|
|
13,000,643 |
|
|
11,050,492 |
|
Waste-to-ore ratio (operating) |
|
0.58 |
|
|
0.62 |
|
|
0.78 |
|
|
0.80 |
|
Tonnes of
ore mined - underground |
|
9,280 |
|
|
19,694 |
|
|
45,258 |
|
|
77,463 |
|
Crushing and
Heap Leach Operations |
|
|
|
|
Tonnes of
ore stacked |
|
1,465,876 |
|
|
1,748,328 |
|
|
5,018,456 |
|
|
5,050,642 |
|
Average
grade of gold processed (5) |
|
0.96 |
|
|
0.96 |
|
|
0.89 |
|
|
0.92 |
|
Contained ounces stacked |
|
45,043 |
|
|
53,690 |
|
|
143,310 |
|
|
149,980 |
|
Mill
Operations |
|
|
|
|
Tonnes of
high grade ore milled |
|
29,806 |
|
|
30,769 |
|
|
91,680 |
|
|
101,879 |
|
Average
grade of gold processed (5) |
|
6.07 |
|
|
10.05 |
|
|
6.70 |
|
|
9.81 |
|
Contained
ounces milled |
|
5,815 |
|
|
9,938 |
|
|
19,744 |
|
|
32,140 |
|
Total contained ounces stacked and milled |
|
50,858 |
|
|
63,628 |
|
|
163,054 |
|
|
182,120 |
|
Recovery
ratio (ratio of ounces produced to contained ounces stacked and
milled) |
|
85 |
% |
|
57 |
% |
|
86 |
% |
|
64 |
% |
Ore
crushed per day (tonnes) - combined |
|
16,300 |
|
|
19,300 |
|
|
18,700 |
|
|
18,900 |
|
(1) |
Cost of
sales includes mining and processing costs, royalties and
amortization. |
(2) |
Refer to
the “Non-GAAP Measures and Additional GAAP Measures” disclosure at
the end of this press release and associated MD&A for a
description and calculation of these measures. Total cash
costs and mine-site AISC are exclusive of net-realizable value
adjustments. |
(3) |
For the
purposes of calculating mine-site all-in sustaining costs, the
Company does not include an allocation of corporate and
administrative and share based compensation expenses. |
(4) |
Includes
ore stockpiled during the quarter. |
(5) |
Grams per
tonne of gold ("g/t Au"). |
|
|
Mulatos produced 43,300 ounces in the third quarter, another
stronger than expected performance driven by higher heap leach
recoveries as well as continued mill production from the
underground San Carlos mine.
With year-to-date production of 139,900 ounces,
the Mulatos mine is on track to meet its increased production
guidance of 170,000 to 180,000 ounces (original guidance was
150,000 to 160,000 ounces).
Total crusher throughput averaged 16,300 tpd for
a total of 1,465,876 tonnes stacked in the third quarter at a grade
of 0.96 g/t Au. This was lower than annual guidance and the prior
year period due to temporary contractor personnel availability
issues which limited mining rates. These issues were resolved in
September. The waste-to-ore ratio of 0.58:1 was lower than the
prior year quarter and guidance.
In the third quarter, 29,806 tonnes of ore from
the San Carlos underground mine were milled at an average grade of
6.07 g/t Au. As guided in the second quarter, mining activities at
San Carlos ceased during the third quarter, with the mine
operating approximately six months longer than
expected at the beginning of the year. With no further production
from the high grade mill, the Company expects fourth quarter
production to be down from the third quarter. The Company expects
2019 production to return to the previously guided range of 150,000
to 160,000 ounces per year.
The recovery ratio of ounces produced to
contained ounces stacked and milled was 85% in the quarter compared
to 57% in the prior year period and guidance of 75%. The higher
recoveries are mainly the result of lower stacking rates in the
quarter and stronger than budgeted recoveries at La Yaqui Phase
I.
Financial Review
For the three months ended September 30, 2018,
revenues of $51.5 million were 32% higher than the prior year
quarter, driven by a 39% increase in ounces sold, partially offset
by lower realized gold prices. Revenues for the nine-month period
were $175.2 million, 28% higher than the prior year period due to
higher ounces sold and higher realized gold prices.
Cost of sales of $41.9 million and $134.7
million for the three and nine-month periods, respectively, were
higher than the prior year periods reflecting higher total tonnes
moved and increased amortization related to mining at La Yaqui
Phase I.
Total cash costs of $771 per ounce in the third
quarter were slightly lower than $785 per ounce in the prior year
quarter, resulting from a lower strip ratio. Total cash costs for
the nine-month period of $784 per ounce were consistent with the
$782 per ounce reported in the prior year period.
Mine-site AISC in the quarter of $846 per ounce
were lower than the $864 per ounce reported in the prior year
quarter, as lower cash costs were partially offset by higher
sustaining capital during the quarter. Mine-site AISC for the
nine-month period of $847 per ounce were consistent with the prior
year period and have remained below guidance of $900 per ounce
throughout the year.
Mulatos generated mine-site free cash flow of
$9.3 million for the quarter and has generated $32.8 million
year-to-date, both well ahead of budget, driven by stronger than
expected production, higher gold prices and lower costs. Mulatos
has generated strong cash flow in 2018, part of which has been
invested in advancing the La Yaqui Grande and Cerro Pelon deposits
through permitting, as well as funding ongoing exploration
activities.
El Chanate Financial and Operational
Review
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Gold production (ounces) |
|
9,700 |
|
|
14,900 |
|
|
33,600 |
|
|
48,300 |
|
Gold
sales (ounces) |
|
9,687 |
|
|
14,954 |
|
|
33,463 |
|
|
48,597 |
|
Financial
Review (in millions) |
|
|
|
|
Operating Revenues |
$12.6 |
|
$19.1 |
|
$44.0 |
|
$60.8 |
|
Cost of sales (1) |
$13.6 |
|
$18.2 |
|
$46.3 |
|
$59.6 |
|
(Loss) earnings from
operations |
($1.0 |
) |
$0.9 |
|
($2.3 |
) |
$1.2 |
|
Cash (used by) provided
by operating activities |
($2.6 |
) |
$2.0 |
|
($1.8 |
) |
$4.2 |
|
Capital
expenditures |
$0.2 |
|
$0.3 |
|
$0.5 |
|
$1.2 |
|
Mine-site free cash
flow (2) |
($2.8 |
) |
$1.7 |
|
($2.3 |
) |
$3.0 |
|
Cost of sales, including amortization per ounce of gold sold
(1) |
$1,404 |
|
$1,217 |
|
$1,384 |
|
$1,226 |
|
Total
cash costs per ounce of gold sold (2) |
$1,301 |
|
$1,137 |
|
$1,285 |
|
$1,156 |
|
Mine site
all-in sustaining costs per ounce of gold sold (2),(3) |
$1,332 |
|
$1,164 |
|
$1,312 |
|
$1,187 |
|
Open Pit
Operations |
|
|
|
|
Tonnes of
ore mined |
|
1,316,936 |
|
|
1,625,109 |
|
|
2,569,013 |
|
|
3,579,459 |
|
Total
tonnes mined |
|
2,893,428 |
|
|
5,191,704 |
|
|
8,157,062 |
|
|
18,490,606 |
|
Waste-to-ore ratio (operating) |
|
1.20 |
|
|
2.19 |
|
|
2.18 |
|
|
4.17 |
|
Average grade of gold (4) |
|
0.52 |
|
|
0.48 |
|
|
0.55 |
|
|
0.47 |
|
Crushing and
Heap Leach Operations |
|
|
|
|
Total tonnes of ore stacked |
|
1,233,200 |
|
|
1,537,874 |
|
|
2,493,120 |
|
|
3,548,207 |
|
Average grade of gold (4) |
|
0.52 |
|
|
0.48 |
|
|
0.55 |
|
|
0.50 |
|
Total contained ounces stacked |
|
20,617 |
|
|
23,733 |
|
|
44,086 |
|
|
57,039 |
|
Ore crushed and run-of-mine ore stacked per day (tonnes) -
combined |
|
13,400 |
|
|
16,700 |
|
|
9,100 |
|
|
13,000 |
|
(1) |
Cost
of sales includes mining and processing costs, royalties and
amortization |
(2) |
Refer to
the “Non-GAAP Measures and Additional GAAP Measures” disclosure at
the end of this press release and associated MD&A for a
description and calculation of these measures. Total cash
costs and mine-site AISC are exclusive of net-realizable value
adjustments. |
(3) |
For the
purposes of calculating mine-site all-in sustaining costs, the
Company does not include an allocation of corporate and
administrative and share based compensation expenses. |
(4) |
Grams per
tonne of gold ("g/t Au"). |
|
|
El Chanate produced 9,700 ounces of gold in the third quarter of
2018, down from 14,900 ounces in the prior year quarter,
reflecting lower stacking rates as mining activities wind
down. The Company ceased mining on October 30, 2018, with residual
leaching continuing through 2019.
Financial Review
Third quarter revenues of $12.6 million were
lower than the prior year quarter due to fewer ounces sold as the
mining activities wind down. Revenues for the nine-month
period were $44.0 million compared to $60.8 million in the prior
year period.
Total cash costs per ounce of $1,301 for the
third quarter and $1,285 for the nine-month period were higher than
the respective prior year periods, reflecting lower ounces stacked
in the period and higher processing costs. Mine-site AISC per ounce
were $1,332 for the quarter and $1,312 for the nine-month period,
higher than the respective prior year periods.
Mine-site free cash flow was negative $2.8
million in the quarter and negative $2.3 million year-to-date. El
Chanate is expected to realize higher cash flows from residual
leaching starting in the fourth quarter of 2018. Given El Chanate's
higher cost structure, the Company has hedged El Chanate's fourth
quarter 2018 gold production through gold collar contracts,
ensuring a minimum gold price of $1,290 and participation up to a
price of $1,479 per ounce.
Third Quarter 2018 Development Activities
Kirazlı (Çanakkale, Turkey)
On July 25, 2018, the Company received the GSM
(Business Opening and Operation) permit, and now has all the major
permits required for the start of construction of Kirazlı.
The initial capital estimate for Kirazlı is $152
million of which approximately $25 million is expected to be
invested in 2018. This has declined from recent estimates
reflecting delays in finalizing the mining services and earthworks
contract. In September 2018, the Turkish government issued
amendments to Decree 32 that required certain service contracts be
denominated in Turkish Lira. The Company has now assessed the
applicability of these changes and believes this decree is
applicable to our mining services and earthworks contract. This
contract is now being finalized, with construction activities
expected to ramp up through the end of this year. The remaining
initial capital will be spent in 2019 and first half of 2020. The
Company expects initial production from Kirazlı in the second half
of 2020.
Development activities during the third quarter
were focused on the power line construction, road relocation and
construction of the water reservoir. The road construction was
completed during the quarter, with the water reservoir construction
expected to be completed in early 2019. For the three and nine
months ended September 30, 2018, development expenditures at
Kirazlı were $4.8 million and $14.7 million, respectively.
As outlined in the 2017 Feasibility Study,
Kirazlı has a 44% after-tax internal rate of return and is expected
to produce over 100,000 ounces of gold during its first full year
of production at mine-site all-in sustaining costs of less than
$400 per ounce. The Company expects to benefit from the devaluation
of the Turkish Lira on costs, given the Feasibility Study was
completed at a TL:USD exchange rate of 2.9:1 compared to the
current TL:USD exchange rate of 5.5:1.
Mulatos District (Sonora,
Mexico)
La Yaqui Grande and Cerro Pelon
The environmental impact assessment (“MIA”) for
Cerro Pelon was submitted during the second quarter with approval
expected by the end of the year. The Cerro Pelon deposit is located
approximately three kilometres from the existing Mulatos operation.
Given its proximity to Mulatos’ infrastructure, ore from the Cerro
Pelon open pit will be trucked to the existing heap leach circuit
for crushing and processing. Following receipt of the permits,
construction and pre-stripping activities are expected to take
approximately 18 months with initial production expected in 2020.
Recently completed work includes the design of the waste rock dump,
haulage road and crushing circuit which will be located at the
Mulatos mine.
La Yaqui Grande’s capital budget for 2018 is
focused on permitting and project engineering. The MIA is expected
to be completed and submitted by the end of 2018 with construction
and pre-stripping activities commencing in the latter part of 2019
and production in 2021. Similar to La Yaqui Phase I, La Yaqui
Grande will be developed as a standalone, open pit, heap leach
operation.
The Company has invested $1.5 million on
permitting and engineering activities at these projects in the
third quarter, and $3.4 million year-to-date.
Lynn Lake (Manitoba,
Canada)
The Company released a positive Feasibility
Study on the Lynn Lake project in December 2017 outlining average
annual production of 143,000 ounces over a 10 year mine life
(170,000 ounces over its first six years) at average mine-site
all-in sustaining costs of $745 per ounce.
The 2018 capital budget comprises spending for
both development activities and exploration. Development spending
has been focused on value engineering initiatives and baseline work
in support of the Environmental Impact Study (“EIS”) for the
project that will be submitted to satisfy federal and provincial
environmental assessment requirements. The permitting process is
expected to take approximately two years followed by two years of
construction.
During the third quarter, the Company continued
the review of value engineering initiatives to enhance the
project’s economics, including modifications to the overall site
layout, structures and foundations for the process plant, and
review of camp location. Development spending in the third quarter
of $0.7 million related to project optimization activities, and
$1.8 million year-to-date.
Third Quarter 2018 Exploration Activities
Island Gold (Ontario, Canada)
The 2018 exploration program is targeting three
main areas along the two kilometre Island Main Zone. The focus is
on expanding the down-plunge and lateral extensions of the deposit
with the objective of adding new near-mine Mineral Resources.
Drill holes in the Main and Western Extension
areas are testing high-grade, east-plunging shoots below existing
Mineral Reserves and Resources. Drill holes in the Eastern
Extension are exploring for additional plunging shoots along strike
beyond existing Mineral Reserves and Resources.
In May 2018, the exploration budget was
increased 20% to $18 million. This includes 45,000 metres ("m") of
surface directional exploration drilling, up from 33,000 m. The
2018 program also includes 30,000 m of underground exploration
drilling, 35,000 m of underground delineation drilling, and 15,000
m of regional exploration drilling.
The underground delineation drilling program is
focused on converting Inferred Mineral Resources into Indicated
Mineral Resources. This drilling is being conducted primarily from
the 620 and 840 levels.
Surface exploration drilling
Surface exploration drilling totaled 17,512 m
during the third quarter of 2018, with 16 holes completed as part
of the directional drilling campaign which totaled 14,831 m. The
directional drilling targeted areas peripheral to the Inferred
Mineral Resource blocks below the 1,000 m level, with drill hole
spacing ranging from 75 m to 100 m. The area being targeted by the
surface directional drill program extends approximately 2,000 m in
strike length between the 1,000 m and 1,500 m elevation below
surface.
The surface directional drilling programs will
continue in 2018 with a focus on defining new Inferred Mineral
Resources.
A 12,000 m regional exploration drill program
commenced in September to drill test targets along the Goudreau
Deformation Zone to the west of the main Island Gold Mine deposit.
Drilling is also planned to test a previous high-grade intercept of
9.71 g/t Au (cut) over 5.95 m below the Kremzar gold deposit. At
the end of the quarter, 2,681 m were drilled as part of this
program.
Underground exploration drilling
During the third quarter of 2018, a total of
6,476 m of underground exploration diamond drilling was completed
in 24 holes from the 620 and 840 levels. The objective of the
underground drilling is to identify new Mineral Resources close to
existing Mineral Resource or Reserve blocks.
Total capitalized exploration expenditures at
Island Gold during the third quarter of 2018 were $4.7 million,
with year-to-date capitalized exploration expenditures of $12.5
million.
Mulatos District (Sonora,
Mexico)
The Company has a large exploration package
covering 28,777 hectares with the majority of past exploration
efforts focused around the Mulatos mine. Over the last three years,
exploration has moved beyond the main Mulatos pit area and focused
on prospects throughout the wider district. After significant
exploration success at La Yaqui Grande over the past few years, the
focus in 2018 has shifted to other parts of the district including
El Carricito, El Halcon and El Jaspe.
In the third quarter of 2018, the Company
invested $2.0 million in exploration activities within the Mulatos
District, of which $0.3 million was capitalized and the remainder
expensed. This included 4,174 m of diamond drilling focused on El
Carricito. Year-to-date, the Company has spent $9.0 million, of
which $2.3 million was capitalized.
At El Carricito the drill program is testing
anomalous alteration and structural targets identified by mapping
in the first half of 2018.
Lynn Lake (Manitoba,
Canada)
The regional exploration program,
including till sampling, mapping, and prospecting, continued in the
third quarter. The observations and results from the regional
exploration program will be integrated with the Lynn Lake database
and interpreted in conjunction with the results of the
airborne gravity gradiometer (AGG) and magnetic survey with the
objective of generating a pipeline of prospective targets across
the Lynn Lake Greenstone Belt.
Spending in the third quarter totaled $2.0
million, bringing the year-to-date expenditures to $3.7
million.
Review of Third Quarter Financial Results
During the third quarter of 2018, the Company
sold 119,401 ounces of gold for total revenue of $146.7 million, a
14% increase compared to the prior year period. This was primarily
driven by the Island Gold acquisition, which contributed 20,561
ounces, or $25.3 million in gold sales for the quarter, offset by a
lower realized price of $1,229 per ounce compared to $1,281 per
ounce in the prior year period (a $5.2 million impact). The
Company's realized gold price of $1,229 per ounce was $16 per ounce
higher than the London PM fix of $1,213.
For the third quarter of 2018, cost of sales
were $137.6 million, compared to $100.6 million in the prior-year
period.
Mining and processing costs were $92.8 million
compared to $69.2 million in the prior-year period. The increased
costs were mainly the result of the addition of Island Gold, which
added $12.5 million of mining and processing costs in the period,
as well as higher per-unit operating costs at Young-Davidson.
Consolidated total cash costs for the quarter
were $817 per ounce, compared to $720 in the prior year period. The
increase was driven by higher total cash costs at Young-Davidson
and El Chanate, partially offset by the addition of lower cost
production from Island Gold.
In the third quarter, AISC per ounce increased
to $1,048 from $884 in the prior year period. This was primarily
driven by higher total cash costs, and the timing of sustaining
capital spending at Island Gold.
Royalty expense was $4.8 million in the third
quarter, compared to $3.2 million in the prior year period,
primarily due to the addition of Island Gold production, and a
higher number of ounces sold at Mulatos.
Amortization of $40.0 million in the quarter was
higher than the prior year period expense of $28.2 million.
Amortization was $335 per ounce, up from $280 per ounce in the
prior year period, though consistent with the second quarter of
2018 and guidance. This reflected higher amortization at all
operating sites and the addition of Island Gold which carries a
higher amortization per ounce charge.
The Company recognized earnings from operations
of $0.6 million in the quarter, compared to $20.9 million in the
same period of 2017, as a result of increased operating costs at
Young-Davidson and higher amortization charges at Island Gold,
partially offset by stronger operating margins at Mulatos.
The Company reported net earnings of $7.2
million in the quarter, compared to net earnings of $28.8 million
in the same period of 2017. Net earnings in the period were
impacted by foreign exchange movements related to the strengthening
of Canadian dollar and Mexican Peso, which generated a foreign
exchange gain of $0.7 million, as well as foreign exchange gain of
$8.0 million recorded within deferred income taxes.
Associated Documents
This press release should be read in conjunction
with the Company’s interim consolidated financial statements for
the three-month period ended September 30, 2018 and associated
Management’s Discussion and Analysis (“MD&A”), which are
available from the Company's website, www.alamosgold.com, in the
"Investors" section under "Reports and Financials", and on SEDAR
(www.sedar.com) and EDGAR (www.sec.gov).
Reminder of Third Quarter 2018 Results Conference
Call
The Company's senior management will host a
conference call on Friday, November 2, 2018 at 11:00 am ET to
discuss the first quarter 2018 results.
Participants may join the conference call by
dialling (416) 340-2216 or (800) 273-9672 for calls within Canada
and the United States, or via webcast
at www.alamosgold.com.
A playback will be available until November 29,
2018 by dialling (905) 694-9451 or (800) 408-3053 within Canada and
the United States. The pass code is 4683388#. The webcast will be
archived at www.alamosgold.com.
Qualified Persons
Chris Bostwick, FAusIMM, Alamos’ Vice President, Technical
Services, who is a qualified person within the meaning of National
Instrument 43-101 ("Qualified Person"), has reviewed and approved
the scientific and technical information contained in this press
release.
About Alamos
Alamos is a Canadian-based intermediate gold producer with
diversified production from four operating mines in North America.
This includes the Young-Davidson and Island Gold mines in northern
Ontario, Canada and the Mulatos and El Chanate mines in Sonora
State, Mexico. Additionally, the Company has a significant
portfolio of development stage projects in Canada, Mexico, Turkey,
and the United States. Alamos employs more than 1,700 people and is
committed to the highest standards of sustainable development. The
Company’s shares are traded on the TSX and NYSE under the symbol
“AGI”.
FOR FURTHER INFORMATION, PLEASE CONTACT:
Scott K. ParsonsVice-President, Investor Relations(416)
368-9932 x 5439
All amounts are in United States dollars, unless otherwise
stated.
The TSX and NYSE have not reviewed and do not accept
responsibility for the adequacy or accuracy of this
release.
Cautionary Note
This press release contains statements that
constitute forward-looking information as defined under applicable
Canadian and U.S. securities laws. All statements in this
press release, other than statements of historical fact, which
address events, results, outcomes or development that the Company
expects to occur are, or may be deemed to be forward-looking
statements. Forward-looking statements are generally, but not
always, identified by the use of forward-looking terminology such
as "expect", "believe", "anticipate”, “intends", "estimates",
"forecast", "budget", “contemplate”, “continue”, “plan” or
variations of such words and phrases and similar expressions or
statements that certain actions, events or results “may",
"could", "would", "might" or "will" be taken, occur or be
achieved.
Forward-looking statements include information
as to strategy, plans or future financial or operating performance,
such as the Company’s expansion plans, project timelines,
production plans and expected sustainable productivity increases,
expected increases in mining activities and corresponding cost
efficiencies, expected drilling targets, expected sustaining costs,
expected improvements in cash flows and margins, expectations of
changes in capital expenditures, forecasted cash shortfalls and the
Company’s ability to fund them, cost estimates, projected
exploration results, reserve and resource estimates, expected
production rates and use of the stockpile inventory, expected
recoveries, sufficiency of working capital for future commitments
and other statements that express management’s expectations or
estimates of future performance.
Forward-looking statements are necessarily based
upon a number of factors and assumptions that, while considered
reasonable by the Company at the time of making such statements,
are inherently subject to significant business, economic, legal,
political and competitive uncertainties and contingencies. Known
and unknown factors could cause actual results to differ materially
from those projected in the forward-looking statements.
Such factors and assumptions underlying the
forward-looking statements in this document include, but are not
limited to: changes to current estimates of mineral reserves and
resources; changes to production estimates (which assume accuracy
of projected ore grade, mining rates, recovery timing and recovery
rate estimates and may be impacted by unscheduled maintenance,
labour and contractor availability and other operating or technical
difficulties); fluctuations in the price of gold; changes in
foreign exchange rates (particularly the Canadian dollar, Mexican
peso, Turkish Lira and U.S. dollar); the impact of inflation;
employee and community relations; litigation; disruptions affecting
operations; availability of and increased costs associated with
mining inputs and labour; development delays at the Young-Davidson
mine; inherent risks associated with mining and mineral processing;
the risk that the Company’s mines may not perform as planned;
uncertainty with the Company’s ability to secure additional capital
to execute its business plans; the speculative nature of mineral
exploration and development, including the risks of obtaining
necessary licenses, permits and authorizations for the
Company’s development and operating assets; contests over
title to properties; changes in national and local government
legislation (including tax legislation) in Canada, Mexico, Turkey,
the United States and other jurisdictions in which the Company does
or may carry on business in the future; risk of loss due to
sabotage and civil disturbances; the impact of global liquidity and
credit availability and the values of assets and liabilities based
on projected future cash flows; risks arising from holding
derivative instruments; and business opportunities that may be
pursued by the Company
Additional risk factors and details with respect
to risk factors affecting the Company are set out in the Company’s
latest Annual Information Form and MD&A, each under the heading
“Risk Factors”, available on the SEDAR website at www.sedar.com.
The foregoing should be reviewed in conjunction with the
information found in this news release.
The Company disclaims any intention or
obligation to update or revise any forward-looking statements
whether as a result of new information, future events or otherwise,
except as required by applicable law.
Cautionary Note to U.S. Investors
Concerning Measured, Indicated and Inferred Resources
The Company is required to prepare its resource
estimates in accordance with standards of the Canadian
Institute of Mining, Metallurgy and Petroleum referred to in
Canadian National Instrument 43-101. These standards are materially
different from the standards generally permitted in reports filed
with the United States Securities and Exchange Commission.
When describing resources we use the terms "measured", "indicated"
or "inferred” resources which are not recognized by the United
States Securities and Exchange Commission. The estimation of
measured resources and indicated resources involve greater
uncertainty as to their existence and economic feasibility than the
estimation of proven and probable reserves. U.S. investors are
cautioned not to assume that any part of measured or indicated
resources will ever be converted into economically or legally
mineable proven or probable reserves. The estimation of inferred
resources may not form the basis of a feasibility or other economic
studies and involves far greater uncertainty as to their existence
and economic viability than the estimation of other categories of
resources.
Non-GAAP Measures and Additional GAAP
Measures
The Company has included certain non-GAAP
financial measures to supplement its Consolidated Financial
Statements, which are presented in accordance with IFRS, including
the following:
- adjusted net earnings and adjusted earnings per share;
- cash flow from operating activities before changes in working
capital and taxes received;
- Company-wide free cash flow;
- total mine-site free cash flow;
- mine-site free cash flow;
- total cash cost per ounce of gold sold;
- all-in sustaining cost ("AISC") per ounce of gold sold;
- mine-site all-in sustaining cost ("Mine-site AISC") per ounce
of gold sold;
- sustaining and non-sustaining capital expenditures; and
- earnings before interest, taxes, depreciation, and
amortization
The Company believes that these measures,
together with measures determined in accordance with IFRS, provide
investors with an improved ability to evaluate the underlying
performance of the Company. Non-GAAP financial measures do not have
any standardized meaning prescribed under IFRS, and therefore they
may not be comparable to similar measures employed by other
companies. The data is intended to provide additional information
and should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with IFRS.
Management's determination of the components of non-GAAP and
additional measures are evaluated on a periodic basis influenced by
new items and transactions, a review of investor uses and new
regulations as applicable. Any changes in to the measures are dully
noted and retrospectively applied as applicable.
Adjusted Net Earnings and Adjusted
Earnings per Share
“Adjusted net earnings” and “adjusted earnings
per share” are non-GAAP financial measures with no standard meaning
under IFRS which exclude the following from net earnings:
- Foreign exchange gain (loss)
- Items included in other gain (loss)
- Certain non-reoccurring items
- Foreign exchange gain (loss) recorded in deferred tax
expense
Net earnings have been adjusted, including the
associated tax impact, for the group of costs in “Other loss” on
the consolidated statement of comprehensive income. Transactions
within this grouping are: the fair value changes on non-hedged
derivatives; the renunciation of flow-through exploration
expenditures; and loss on disposal of assets. The adjusted entries
are also impacted for tax to the extent that the underlying entries
are impacted for tax in the unadjusted net earnings.
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
shareholders to better understand the underlying operating
performance of the 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 our business and a review of the non-GAAP measures
used by mining industry analysts and other mining companies.
Adjusted net earnings 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 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 operating profit or cash flows from operations as determined
under IFRS. The following table reconciles this non-GAAP measure to
the most directly comparable IFRS measure.
|
|
|
|
|
(in millions) |
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Net Earnings (Loss) |
$7.2 |
|
$28.8 |
|
($1.1 |
) |
$31.3 |
|
Adjustments: |
|
|
|
|
Foreign
exchange (gain) loss |
|
(0.7 |
) |
|
(0.7 |
) |
|
2.7 |
|
|
(10.1 |
) |
Other
gain |
|
(0.4 |
) |
|
(1.3 |
) |
|
(1.7 |
) |
|
(2.2 |
) |
Unrealized foreign exchange loss (gain) recorded in deferred tax
expense |
|
(8.0 |
) |
|
(13.1 |
) |
|
14.7 |
|
|
(22.2 |
) |
Loss on
redemption of senior secured notes |
|
— |
|
|
— |
|
|
— |
|
|
29.1 |
|
Other
income and mining tax adjustments (1) |
|
— |
|
|
— |
|
|
0.7 |
|
|
(7.5 |
) |
Adjusted net earnings |
($1.9 |
) |
$13.7 |
|
$15.3 |
|
$18.4 |
|
Adjusted
earnings per share - basic |
|
$— |
|
$0.05 |
|
$0.04 |
|
$0.06 |
|
(1) |
This
reflects the recognition of previously unrecognized capital losses,
and the tax impact on adjusted earnings. |
|
|
Cash Flow from Operating Activities before Changes in
Working Capital and Cash Taxes
“Cash flow from operating activities before
changes in working capital and cash taxes” is a non-GAAP
performance measure that could provide an indication of the
Company’s ability to generate cash flows from operations, and is
calculated by adding back the change in working capital and taxes
received to “Cash provided by (used in) operating activities” as
presented on the Company’s consolidated statements of cash flows.
“Cash flow from operating activities before changes in working
capital” is a non-GAAP financial measure with no standard meaning
under IFRS.
The following table reconciles the non-GAAP
measure to the consolidated statements of cash flows.
|
|
|
|
|
(in millions) |
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Cash flow from operating activities |
$45.2 |
|
$43.4 |
|
$166.5 |
|
$114.9 |
|
Add back: Changes in
working capital and cash taxes |
|
(3.6 |
) |
|
7.9 |
|
|
(7.6 |
) |
|
15.7 |
|
Cash flow from operating activities before changes in
working capital and cash taxes |
$41.6 |
|
$51.3 |
|
$158.9 |
|
$130.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company-wide Free Cash Flow
“Company-wide free cash flow" is a non-GAAP
performance measure calculated from the consolidated operating cash
flow, less consolidated mineral property, plant and equipment
expenditures. The Company believes this to be a useful indicator of
our ability to operate without reliance on additional borrowing or
usage of existing cash company-wide. Company-wide free cash flow is
intended to provide additional information only and does not have
any standardized meaning under IFRS and may not be comparable to
similar measures of performance presented by other mining
companies. Company-wide free cash flow should not be considered in
isolation or as a substitute for measures of performance prepared
in accordance with IFRS.
|
|
|
|
|
(in millions) |
|
|
|
|
|
Three Months Ended September 30, |
Nine months ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Cash flow from operating activities |
$45.2 |
|
$43.4 |
|
$166.5 |
|
$114.9 |
|
Less: mineral property,
plant and equipment expenditures |
|
(55.1 |
) |
|
(38.2 |
) |
|
(160.0 |
) |
|
(123.3 |
) |
Company-wide free cash flow |
($9.9 |
) |
$5.2 |
|
$6.5 |
|
($8.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Mine-site Free Cash Flow
"Mine-site free cash flow" is a non-GAAP
financial performance measure calculated as cash flow from
mine-site operating activities, less mineral property, plant and
equipment expenditures. The Company believes this to be a useful
indicator of our ability to operate without reliance on additional
borrowing or usage of existing cash. Mine-site free cash flow is
intended to provide additional information only and does not have
any standardized meaning under IFRS and may not be comparable to
similar measures of performance presented by other mining
companies. Mine-site free cash flow should not be considered in
isolation or as a substitute for measures of performance prepared
in accordance with IFRS.
|
|
|
|
|
Total Mine-Site Free Cash Flow |
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
(in millions) |
|
|
|
|
Cash flow from
operating activities |
$45.2 |
|
$43.4 |
|
$166.5 |
|
$114.9 |
|
Less: operating cash
flow used by non-mine site activity |
|
(6.2 |
) |
|
(7.0 |
) |
|
(21.5 |
) |
|
(12.4 |
) |
Cash flow from operating mine-sites |
$51.4 |
|
$50.4 |
|
$188.0 |
|
$127.3 |
|
|
|
|
|
|
Mineral property, plant
and equipment expenditure |
$55.1 |
|
$38.2 |
|
$160.0 |
|
$123.3 |
|
Less: capital
expenditures from development projects, and corporate (1) |
|
(8.2 |
) |
|
(8.7 |
) |
|
(23.2 |
) |
|
(36.4 |
) |
Capital expenditure from mine-sites |
$46.9 |
|
$29.5 |
|
$136.8 |
|
$86.9 |
|
|
|
|
|
|
Total mine-site free cash flow |
$4.5 |
|
$20.9 |
|
$51.2 |
|
$40.4 |
|
(1) |
The
comparative periods include capital expenditures related to La
Yaqui Phase I of $1.7 million and 12.5 million for the three and
nine months ended September 30, 2017. |
|
|
|
|
|
|
|
Young-Davidson Mine-Site Free Cash Flow |
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
(in millions) |
|
|
|
|
Cash flow from
operating activities |
$24.0 |
|
$35.3 |
|
$73.9 |
|
$81.1 |
|
Mineral property, plant
and equipment expenditure |
|
(22.1 |
) |
|
(22.0 |
) |
|
(63.5 |
) |
|
(63.3 |
) |
Mine-site free cash flow |
$1.9 |
|
$13.3 |
|
$10.4 |
|
$17.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mulatos Mine-Site Free Cash Flow |
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
2017 |
|
2018 |
|
2017 |
(in millions) |
|
|
|
|
Cash flow from operating
activities |
$16.1 |
|
$13.1 |
|
$56.3 |
|
$42.0 |
|
Mineral property, plant
and equipment expenditure |
|
(6.8 |
) |
|
(8.9 |
) |
|
(23.5 |
) |
|
(34.9 |
) |
Less: La
Yaqui Phase I construction cost |
|
— |
|
|
1.7 |
|
|
— |
|
|
12.5 |
|
Mulatos
mineral property, plant and equipment expenditure |
($6.8 |
) |
($7.2 |
) |
($23.5 |
) |
($22.4 |
) |
Mine-site free cash flow |
$9.3 |
|
$5.9 |
|
$32.8 |
|
$19.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Island Gold Mine-Site Free Cash Flow |
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
(in millions) |
|
|
|
|
Cash flow from
operating activities |
$13.9 |
|
|
— |
|
$59.6 |
|
|
— |
|
Mineral property, plant
and equipment expenditure |
|
(17.8 |
) |
|
— |
|
|
(49.3 |
) |
|
— |
|
Mine-site free cash flow |
($3.9 |
) |
|
$— |
|
$10.3 |
|
|
$— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
El Chanate Mine-Site Free Cash Flow |
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
(in millions) |
|
|
|
|
Cash flow from
operating activities |
($2.6 |
) |
$2.0 |
|
($1.8 |
) |
$4.2 |
|
Mineral property, plant
and equipment expenditure |
|
(0.2 |
) |
|
(0.3 |
) |
|
(0.5 |
) |
|
(1.2 |
) |
Mine-site free cash flow |
($2.8 |
) |
$1.7 |
|
($2.3 |
) |
$3.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Cash Costs per ounce
Total cash costs per ounce is a non-GAAP term
typically used by gold mining companies to assess the level of
gross margin available to the Company by subtracting these costs
from the unit price realized during the period. This non-GAAP term
is also used to assess the ability of a mining company to generate
cash flow from operations. Total cash costs per ounce includes
mining and processing costs plus applicable royalties, and net of
by-product revenue and net realizable value adjustments. Total cash
costs per ounce is exclusive of exploration costs.
Total cash costs per 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.
All-in Sustaining Costs per ounce and
Mine-site All-in Sustaining Costs
The Company adopted an “all-in sustaining costs
per ounce” non-GAAP performance measure in accordance with the
World Gold Council published in June 2013. The Company
believes the measure more fully defines the total costs associated
with producing gold; however, this performance measure has no
standardized meaning. Accordingly, there may be some
variation in the method of computation of “all-in sustaining costs
per ounce” as determined by the Company compared with other mining
companies. In this context, “all-in sustaining costs per ounce” for
the consolidated Company reflects total mining and processing
costs, corporate and administrative costs, share-based
compensation, exploration costs, sustaining capital, and other
operating costs.
For the purposes of calculating "mine-site
all-in sustaining costs" at the individual mine-sites, the Company
does not include an allocation of corporate and administrative
costs and share-based compensation, as detailed in the
reconciliations below.
Sustaining capital expenditures are expenditures
that do not increase annual gold ounce production at a mine site
and excludes all expenditures at the Company’s development projects
as well as certain expenditures at the Company’s operating sites
that are deemed expansionary in nature. For each mine-site
reconciliation, corporate and administrative costs, and non-site
specific costs are not included in the all-in sustaining cost per
ounce calculation.
All-in sustaining costs per gold 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.
Total Cash Costs and All-in Sustaining
Costs per Ounce Reconciliation Tables
The following tables reconciles these non-GAAP
measures to the most directly comparable IFRS measures on a
Company-wide and individual mine-site basis.
|
|
|
Total Cash Costs and AISC Reconciliation -
Company-wide |
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
(in millions, except
ounces and per ounce figures) |
|
|
|
|
Mining and
processing |
$92.8 |
|
$69.2 |
|
$291.0 |
|
$225.0 |
|
Royalties |
|
4.8 |
|
|
3.2 |
|
|
16.8 |
|
|
10.7 |
|
Total cash costs |
$97.6 |
|
$72.4 |
|
$307.8 |
|
$235.7 |
|
Gold
ounces sold |
|
119,401 |
|
|
100,551 |
|
|
378,718 |
|
|
303,329 |
|
Total cash
costs per ounce |
$817 |
|
$720 |
|
$813 |
|
$777 |
|
|
|
|
|
|
Total cash costs |
$97.6 |
|
$72.4 |
|
$307.8 |
|
$235.7 |
|
Corporate and
administrative(1) |
|
4.9 |
|
|
3.6 |
|
|
13.9 |
|
|
10.9 |
|
Sustaining capital
expenditures(2) |
|
19.6 |
|
|
10.8 |
|
|
42.4 |
|
|
31.2 |
|
Share-based
compensation |
|
1.2 |
|
|
1.1 |
|
|
5.3 |
|
|
5.1 |
|
Sustaining
exploration |
|
1.1 |
|
|
1.1 |
|
|
3.9 |
|
|
2.9 |
|
Accretion of
decommissioning liabilities |
|
0.7 |
|
|
0.7 |
|
|
2.2 |
|
|
2.0 |
|
Realized gains on FX
options |
|
— |
|
|
(0.8 |
) |
|
— |
|
|
(0.8 |
) |
Total all-in sustaining costs |
$125.1 |
|
$88.9 |
|
$375.5 |
|
$287.0 |
|
Gold ounces sold |
|
119,401 |
|
|
100,551 |
|
|
378,718 |
|
|
303,329 |
|
All-in sustaining costs per ounce |
$1,048 |
|
$884 |
|
$992 |
|
$946 |
|
(1) |
Corporate and
administrative expenses exclude expenses incurred at development
properties. |
(2) |
Sustaining capital
expenditures are defined as those expenditures which do not
increase annual gold ounce production at a mine site and exclude
all expenditures at growth projects and certain expenditures at
operating sites which are deemed expansionary in nature. Total
sustaining capital for the period is as follows: |
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
(in millions) |
|
|
|
|
Capital expenditures
per cash flow statement |
$55.1 |
|
$38.2 |
|
$160.0 |
|
$123.3 |
|
Less: non-sustaining
capital expenditures at: |
|
|
|
|
Young-Davidson |
|
(12.6 |
) |
|
(12.6 |
) |
|
(38.5 |
) |
|
(37.9 |
) |
Mulatos |
|
(4.7 |
) |
|
(7.8 |
) |
|
(18.8 |
) |
|
(30.3 |
) |
Island
Gold |
|
(10.0 |
) |
|
— |
|
|
(37.1 |
) |
|
— |
|
Corporate
and other |
|
(8.2 |
) |
|
(7.0 |
) |
|
(23.2 |
) |
|
(23.9 |
) |
|
$19.6 |
|
$10.8 |
|
$42.4 |
|
$31.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Young-Davidson Total Cash Costs and Mine-site
AISC Reconciliation |
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
(in millions, except
ounces and per ounce figures) |
|
|
|
|
Mining and
processing |
$37.8 |
|
$30.4 |
|
$110.3 |
|
$90.8 |
|
Royalties |
|
0.8 |
|
|
1.2 |
|
|
2.6 |
|
|
3.3 |
|
Total cash costs |
$38.6 |
|
$31.6 |
|
$112.9 |
|
$94.1 |
|
Gold
ounces sold |
|
46,853 |
|
|
55,267 |
|
|
133,649 |
|
|
145,462 |
|
Total cash
costs per ounce |
$824 |
|
$572 |
|
$845 |
|
$647 |
|
|
|
|
|
|
Total cash costs |
$38.6 |
|
$31.6 |
|
$112.9 |
|
$94.1 |
|
Sustaining capital
expenditures |
|
9.5 |
|
|
9.4 |
|
|
25.0 |
|
|
25.4 |
|
Exploration |
|
— |
|
|
0.1 |
|
|
0.1 |
|
|
0.3 |
|
Accretion of
decommissioning liabilities |
|
0.1 |
|
|
— |
|
|
0.2 |
|
|
0.1 |
|
Total all-in sustaining costs |
$48.2 |
|
$41.1 |
|
$138.2 |
|
$119.9 |
|
Gold ounces sold |
|
46,853 |
|
|
55,267 |
|
|
133,649 |
|
|
145,462 |
|
Mine-site all-in sustaining costs per ounce |
$1,029 |
|
$744 |
|
$1,034 |
|
$824 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mulatos Total Cash Costs and Mine-site AISC
Reconciliation |
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
(in millions, except
ounces and per ounce figures) |
|
|
|
|
Mining and
processing |
$29.9 |
|
$21.8 |
|
$97.2 |
|
$78.0 |
|
Royalties |
|
2.7 |
|
|
2.0 |
|
|
9.7 |
|
|
7.4 |
|
Total cash costs |
$32.6 |
|
$23.8 |
|
$106.9 |
|
$85.4 |
|
Gold
ounces sold |
|
42,300 |
|
|
30,330 |
|
|
136,285 |
|
|
109,270 |
|
Total cash
costs per ounce |
$771 |
|
$785 |
|
$784 |
|
$782 |
|
|
|
|
|
|
Total cash costs |
$32.6 |
|
$23.8 |
|
$106.9 |
|
$85.4 |
|
Sustaining capital
expenditures |
|
2.1 |
|
|
1.1 |
|
|
4.7 |
|
|
4.6 |
|
Exploration |
|
0.6 |
|
|
0.7 |
|
|
2.3 |
|
|
1.5 |
|
Accretion of
decommissioning liabilities |
|
0.5 |
|
|
0.6 |
|
|
1.6 |
|
|
1.6 |
|
Total all-in sustaining costs |
$35.8 |
|
$26.2 |
|
$115.5 |
|
$93.1 |
|
Gold ounces sold |
|
42,300 |
|
|
30,330 |
|
|
136,285 |
|
|
109,270 |
|
Mine-site all-in sustaining costs per ounce |
$846 |
|
$864 |
|
$847 |
|
$852 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Island Gold Total Cash Costs and Mine-site AISC
Reconciliation |
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
(in millions, except
ounces and per ounce figures) |
|
|
|
|
Mining and
processing |
$12.5 |
|
|
$— |
|
$40.5 |
|
|
$— |
|
Royalties |
|
1.3 |
|
|
— |
|
|
4.5 |
|
|
— |
|
Total cash costs |
$13.8 |
|
|
$— |
|
$45.0 |
|
|
$— |
|
Gold
ounces sold |
|
20,561 |
|
|
— |
|
|
75,321 |
|
|
— |
|
Total cash
costs per ounce |
$671 |
|
|
$— |
|
$597 |
|
|
$— |
|
|
|
|
|
|
Total cash costs |
$13.8 |
|
|
$— |
|
$45.0 |
|
|
$— |
|
Sustaining capital
expenditures |
|
7.8 |
|
|
— |
|
|
12.2 |
|
|
— |
|
Total all-in sustaining costs |
$21.6 |
|
|
$— |
|
$57.2 |
|
|
$— |
|
Gold ounces sold |
|
20,561 |
|
|
— |
|
|
75,321 |
|
|
— |
|
Mine-site all-in sustaining costs per ounce |
$1,051 |
|
|
$— |
|
$759 |
|
|
$— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
El Chanate Total Cash Costs and Mine-site AISC
Reconciliation |
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
(in millions, except
ounces and per ounce figures) |
|
|
|
|
Mining and
processing |
$12.6 |
|
$17.0 |
|
$43.0 |
|
$56.2 |
|
Total cash costs |
$12.6 |
|
$17.0 |
|
$43.0 |
|
$56.2 |
|
Gold
ounces sold |
|
9,687 |
|
|
14,954 |
|
|
33,463 |
|
|
48,597 |
|
Total cash
costs per ounce |
$1,301 |
|
$1,137 |
|
$1,285 |
|
$1,156 |
|
|
|
|
|
|
Total cash costs |
$12.6 |
|
$17.0 |
|
$43.0 |
|
$56.2 |
|
Sustaining capital
expenditures |
|
0.2 |
|
|
0.3 |
|
|
0.5 |
|
|
1.2 |
|
Accretion of
decommissioning liabilities |
|
0.1 |
|
|
0.1 |
|
|
0.4 |
|
|
0.3 |
|
Total all-in sustaining costs |
$12.9 |
|
$17.4 |
|
$43.9 |
|
$57.7 |
|
Gold ounces sold |
|
9,687 |
|
|
14,954 |
|
|
33,463 |
|
|
48,597 |
|
Mine-site all-in sustaining costs per ounce |
$1,332 |
|
$1,164 |
|
$1,312 |
|
$1,187 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Before Interest, Taxes,
Depreciation, and Amortization (“EBITDA”)
EBITDA represents net earnings before interest,
taxes, depreciation, and amortization. EBITDA is an indicator of
the Company’s ability to generate liquidity by producing operating
cash flow to fund working capital needs, service debt obligations,
and fund capital expenditures.
EBITDA 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 following is a reconciliation of EBITDA to
the consolidated financial statements:
|
|
|
|
|
(in millions) |
|
|
|
|
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Net earnings
(loss) |
$7.2 |
|
$28.8 |
|
($1.1 |
) |
$31.3 |
|
Add back: |
|
|
|
|
Finance
expense |
|
1.0 |
|
|
0.8 |
|
|
2.8 |
|
|
5.5 |
|
Amortization |
|
40.0 |
|
|
28.2 |
|
|
124.5 |
|
|
84.5 |
|
Loss on
redemption of senior secured notes |
|
— |
|
|
— |
|
|
— |
|
|
29.1 |
|
Deferred
income tax (recovery) expense |
|
(10.7 |
) |
|
(8.2 |
) |
|
8.1 |
|
|
(22.3 |
) |
Current income tax expense |
|
4.2 |
|
|
1.5 |
|
|
17.9 |
|
|
7.6 |
|
EBITDA |
$41.7 |
|
$51.1 |
|
$152.2 |
|
$135.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional GAAP Measures
Additional GAAP measures are presented on the
face of the Company’s consolidated statements of comprehensive
income and are not meant to be a substitute for other subtotals or
totals presented in accordance with IFRS, but rather should be
evaluated in conjunction with such IFRS measures. The
following additional GAAP measures are used and are intended to
provide an indication of the Company’s mine and operating
performance:
- Earnings from operations - represents the amount of earnings
before net finance income/expense, foreign exchange gain/loss,
other income/loss, loss on redemption of senior secured notes and
income tax expense
|
Unaudited Consolidated Statements of Financial
Position, Comprehensive |
Income, and Cash Flow |
|
ALAMOS GOLD INC. |
Condensed Interim Consolidated Statements of Financial
Position |
(Unaudited
- stated in millions of United States dollars) |
|
|
|
September
30, 2018 |
|
|
|
December
31, 2017 |
|
A S S E T
S |
|
|
|
Current
Assets |
|
|
|
Cash and cash
equivalents |
$224.8 |
|
|
$200.8 |
|
Equity securities |
|
5.6 |
|
|
|
35.8 |
|
Amounts receivable |
|
31.4 |
|
|
|
41.0 |
|
Inventory |
|
149.9 |
|
|
|
161.2 |
|
Other current
assets |
|
17.6 |
|
|
|
14.4 |
|
Total Current
Assets |
|
429.3 |
|
|
|
453.2 |
|
|
|
|
|
Non-Current
Assets |
|
|
|
Long-term
inventory |
|
61.7 |
|
|
|
68.7 |
|
Mineral property, plant
and equipment |
|
2,798.7 |
|
|
|
2,753.4 |
|
Other non-current
assets |
|
43.7 |
|
|
|
45.0 |
|
Total Assets |
$3,333.4 |
|
|
$3,320.3 |
|
|
|
|
|
L I A B I L I T
I E S |
|
|
|
Current
Liabilities |
|
|
|
Accounts payable and
accrued liabilities |
$115.4 |
|
|
$101.0 |
|
Income taxes
payable |
|
9.5 |
|
|
|
12.2 |
|
Dividends payable |
|
3.9 |
|
|
|
— |
|
Total Current
Liabilities |
|
128.8 |
|
|
|
113.2 |
|
|
|
|
|
Non-Current
Liabilities |
|
|
|
Deferred income
taxes |
|
484.5 |
|
|
|
477.0 |
|
Decommissioning
liabilities |
|
46.3 |
|
|
|
44.6 |
|
Other non-current
liabilities |
|
2.2 |
|
|
|
4.3 |
|
Total Liabilities |
|
661.8 |
|
|
|
639.1 |
|
|
|
|
|
E Q U I T
Y |
|
|
|
Share capital |
$3,693.9 |
|
|
$3,691.7 |
|
Contributed
surplus |
|
94.6 |
|
|
|
89.5 |
|
Warrants |
|
3.9 |
|
|
|
4.0 |
|
Accumulated other
comprehensive (loss) income |
|
(7.4 |
) |
|
|
13.0 |
|
Deficit |
|
(1,113.4 |
) |
|
|
(1,117.0 |
) |
Total Equity |
|
2,671.6 |
|
|
|
2,681.2 |
|
Total Liabilities and Equity |
$3,333.4 |
|
|
$3,320.3 |
|
|
|
|
|
|
|
|
|
|
ALAMOS GOLD INC. |
Condensed Interim Consolidated Statements of Comprehensive
(Loss) Income |
(Unaudited
- stated in millions of United States dollars, except share and per
share amounts) |
|
|
For three months ended |
|
For nine months ended |
|
September 30, |
|
September 30, |
|
September 30, |
|
September 30, |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
OPERATING
REVENUES |
$146.7 |
|
|
$128.8 |
|
|
$488.7 |
|
|
$381.1 |
|
|
|
|
|
|
|
|
|
COST OF
SALES |
|
|
|
|
|
|
|
Mining and
processing |
|
92.8 |
|
|
|
69.2 |
|
|
|
291.0 |
|
|
|
225.0 |
|
Royalties |
|
4.8 |
|
|
|
3.2 |
|
|
|
16.8 |
|
|
|
10.7 |
|
Amortization |
|
40.0 |
|
|
|
28.2 |
|
|
|
124.5 |
|
|
|
84.5 |
|
|
|
137.6 |
|
|
|
100.6 |
|
|
|
432.3 |
|
|
|
320.2 |
|
EXPENSES |
|
|
|
|
|
|
|
Exploration |
|
2.4 |
|
|
|
2.6 |
|
|
|
8.5 |
|
|
|
3.4 |
|
Corporate and
administrative |
|
4.9 |
|
|
|
3.6 |
|
|
|
13.9 |
|
|
|
10.9 |
|
Share-based
compensation |
|
1.2 |
|
|
|
1.1 |
|
|
|
5.3 |
|
|
|
5.1 |
|
|
|
146.1 |
|
|
|
107.9 |
|
|
|
460.0 |
|
|
|
339.6 |
|
EARNINGS FROM
OPERATIONS |
|
0.6 |
|
|
|
20.9 |
|
|
|
28.7 |
|
|
|
38.9 |
|
|
|
|
|
|
|
|
|
OTHER
EXPENSES |
|
|
|
|
|
|
|
Finance expense |
|
(1.0 |
) |
|
|
(0.8 |
) |
|
|
(2.8 |
) |
|
|
(5.5 |
) |
Foreign exchange (loss)
gain |
|
0.7 |
|
|
|
0.7 |
|
|
|
(2.7 |
) |
|
|
10.1 |
|
Other gain |
|
0.4 |
|
|
|
1.3 |
|
|
|
1.7 |
|
|
|
2.2 |
|
Loss on redemption of
senior secured notes |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(29.1 |
) |
EARNINGS (LOSS)
BEFORE INCOME TAXES |
$0.7 |
|
|
$22.1 |
|
|
$24.9 |
|
|
$16.6 |
|
|
|
|
|
|
|
|
|
INCOME
TAXES |
|
|
|
|
|
|
|
Current income tax
expense |
|
(4.2 |
) |
|
|
(1.5 |
) |
|
|
(17.9 |
) |
|
|
(7.6 |
) |
Deferred income tax
(expense) recovery |
|
10.7 |
|
|
|
8.2 |
|
|
|
(8.1 |
) |
|
|
22.3 |
|
NET (LOSS)
EARNINGS |
$7.2 |
|
|
$28.8 |
|
|
($1.1 |
) |
|
$31.3 |
|
|
|
|
|
|
|
|
|
Items that may be
subsequently reclassified to net earnings: |
|
|
|
|
|
|
|
(Loss)
gain on currency hedging instruments, net of taxes |
|
2.5 |
|
|
|
3.8 |
|
|
|
(2.9 |
) |
|
|
5.7 |
|
Items that will not be
reclassified to net earnings: |
|
|
|
|
|
|
|
Unrealized (loss) gain on equity securities, net of taxes |
|
(3.5 |
) |
|
|
(1.1 |
) |
|
|
(5.0 |
) |
|
|
2.7 |
|
Total other
comprehensive (loss) income |
$1.0 |
|
|
$2.8 |
|
|
($7.9 |
) |
|
$10.1 |
|
COMPREHENSIVE
(LOSS) INCOME |
$6.2 |
|
|
$31.6 |
|
|
($9.0 |
) |
|
$41.4 |
|
|
|
|
|
|
|
|
|
(LOSS) EARNINGS
PER SHARE |
|
|
|
|
|
|
|
–
basic |
$0.02 |
|
|
$0.10 |
|
|
$0.00 |
|
|
$0.11 |
|
–
diluted |
$0.02 |
|
|
$0.09 |
|
|
$0.00 |
|
|
$0.10 |
|
Weighted average number
of common shares outstanding (000's) |
|
|
|
|
|
|
|
– basic |
|
389,854 |
|
|
|
300,448 |
|
|
|
389,572 |
|
|
|
294,853 |
|
– diluted |
|
394,546 |
|
|
|
303,888 |
|
|
|
389,572 |
|
|
|
298,506 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALAMOS GOLD INC. |
Condensed Interim Consolidated Statements of Cash
Flows |
(Unaudited
- stated in millions of United States dollars) |
|
|
For three months ended |
|
For nine months ended |
|
September 30, |
|
September 30, |
|
September 30, |
|
September 30, |
|
2018 |
|
2017 |
|
2018 |
|
2017 |
CASH PROVIDED
BY (USED IN): |
|
|
|
|
|
|
|
OPERATING
ACTIVITIES |
|
|
|
|
|
|
|
Net earnings (loss) for the
period |
$7.2 |
|
|
$28.8 |
|
|
($1.1 |
) |
|
$31.3 |
|
Adjustments for items
not involving cash: |
|
|
|
|
|
|
|
Amortization |
|
40.0 |
|
|
|
28.2 |
|
|
|
124.5 |
|
|
|
84.5 |
|
Foreign
exchange (gain) loss |
|
(0.7 |
) |
|
|
(0.7 |
) |
|
|
2.7 |
|
|
|
(10.1 |
) |
Current
income tax expense |
|
4.2 |
|
|
|
1.5 |
|
|
|
17.9 |
|
|
|
7.6 |
|
Deferred
income tax (recovery) expense |
|
(10.7 |
) |
|
|
(8.2 |
) |
|
|
8.1 |
|
|
|
(22.3 |
) |
Share-based compensation |
|
1.2 |
|
|
|
1.1 |
|
|
|
5.3 |
|
|
|
5.1 |
|
Finance
expense |
|
1.0 |
|
|
|
1.1 |
|
|
|
2.8 |
|
|
|
7.7 |
|
Loss on
redemption of senior secured notes |
|
— |
|
|
|
0.0 |
|
|
|
— |
|
|
|
29.1 |
|
Other
items |
|
(0.6 |
) |
|
|
(0.5 |
) |
|
|
(1.3 |
) |
|
|
(2.3 |
) |
Changes in working
capital and cash taxes |
|
3.6 |
|
|
|
(7.9 |
) |
|
|
7.6 |
|
|
|
(15.7 |
) |
|
|
45.2 |
|
|
|
43.4 |
|
|
|
166.5 |
|
|
|
114.9 |
|
INVESTING
ACTIVITIES |
|
|
|
|
|
|
|
Mineral property, plant
and equipment |
|
(55.1 |
) |
|
|
(38.2 |
) |
|
|
(160.0 |
) |
|
|
(123.3 |
) |
Proceeds from sale of
equity securities |
|
— |
|
|
|
— |
|
|
|
24.9 |
|
|
|
— |
|
Purchase of Lynn Lake
gold project royalty |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(6.7 |
) |
Other |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3.6 |
|
|
|
(55.1 |
) |
|
|
(38.2 |
) |
|
|
(135.1 |
) |
|
|
(126.4 |
) |
FINANCING
ACTIVITIES |
|
|
|
|
|
|
|
Net proceeds from
equity financing |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
239.1 |
|
Repayment of senior
secured notes |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(327.2 |
) |
Repayment of equipment
financing obligations |
|
(1.0 |
) |
|
|
(1.1 |
) |
|
|
(3.2 |
) |
|
|
(3.5 |
) |
Interest paid |
|
— |
|
|
|
0.0 |
|
|
|
— |
|
|
|
(12.2 |
) |
Proceeds from the
exercise of options and warrants |
|
0.6 |
|
|
|
0.6 |
|
|
|
1.7 |
|
|
|
3.4 |
|
Dividends paid |
|
0.0 |
|
|
|
— |
|
|
|
(3.9 |
) |
|
|
(3.0 |
) |
Proceeds from issuance
of flow-through shares |
|
— |
|
|
|
11.7 |
|
|
|
0.0 |
|
|
|
11.7 |
|
|
|
(1.2 |
) |
|
|
9.1 |
|
|
|
(6.2 |
) |
|
|
(93.8 |
) |
Effect of exchange
rates on cash and cash equivalents |
|
0.8 |
|
|
|
1.0 |
|
|
|
(1.2 |
) |
|
|
2.1 |
|
Net
(decrease) increase in cash and cash equivalents |
|
(10.3 |
) |
|
|
15.3 |
|
|
|
24.0 |
|
|
|
(103.2 |
) |
Cash and cash
equivalents - beginning of period |
|
235.1 |
|
|
|
133.7 |
|
|
|
200.8 |
|
|
|
252.2 |
|
CASH AND CASH
EQUIVALENTS - END OF PERIOD |
$224.8 |
|
|
$149.0 |
|
|
$224.8 |
|
|
$149.0 |
|
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