0001828377false00018283772023-08-012023-08-01

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K


CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of the earliest event reported): August 1, 2023

Commission file number: 333-249533

FORTITUDE GOLD CORPORATION

(Exact name of registrant as specified in its charter)

Colorado

85-2602691

(State of Other Jurisdiction of incorporation or Organization)

(I.R.S. Employer Identification No.)

2886 Carriage Manor Point, Colorado Springs, CO

80906

(Address of principal executive offices)

(Zip code)

Registrant’s telephone number, including area code: (719) 717-9825

Check the appropriate box below if the form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol(s)

Name Of Each Exchange

On Which Registered

N/A

N/A

N/A

Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Item 2.02  Results of Operations and Financial Condition.

On August 1, 2023, Fortitude Gold Corporation issued a news release reporting its financial results for the quarter ended June 30, 2023. A copy of the news release is attached as Exhibit 99.1 to this report.

In accordance with General Instruction B.2 of Form 8-K, the information in this Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any of the Company’s filings or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01  Financial Statements and Exhibits.

(d)  Exhibits. The following exhibits are furnished with this report:

99.1News Release dated August 1, 2023.

104Inline XBRL for the cover page of this Current Report on Form 8-K.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date:  August 1, 2023

FORTITUDE GOLD CORPORATION

By:

/s/ Jason D. Reid

Jason D. Reid, Chief Executive Officer

Exhibit 99.1

FOR IMMEDIATE RELEASE NEWS

August 1, 2023 OTCQB: FTCO

FORTITUDE GOLD REPORTS SECOND QUARTER NET INCOME OF $3.6 MILLION, MAINTAINS 2023 PRODUCTION OUTLOOK

COLORADO SPRINGS – August 1, 2023 - Fortitude Gold Corporation (OTCQB: FTCO) (the “Company”) reported results for the second quarter ended June 30, 2023, including $19.2 million net sales, $3.6 million net income, or $0.15 per share, and a $46.9 million cash balance at quarter end.  The Company produced 9,684 ounces of gold during the second quarter and maintains its 2023 production outlook.  Fortitude Gold is a gold producer, developer, and explorer with operations in Nevada, U.S.A. offering investors exposure to both gold production and dividend yield.

Q2 2023 FINANCIAL RESULTS AND HIGHLIGHTS

$19.2 million net sales
$3.6 million net income, or $0.15 per share
$46.9 million cash balance on June 30, 2023
9,684 gold ounces produced
3.36 grams per tonne average gold grade mined
$91.9 million working capital at June 30, 2023
$11.2 million mine gross profit
$6.1 million exploration expenditures
$527 total cash cost after by-product credits per gold ounce sold
$680 per ounce total all-in sustaining cost
$3.9 million dividends paid
$0.04 special dividend

Fortitude Gold sold 9,702 gold ounces at a total cash cost of $527 per ounce (after by-product credits) and an all-in-sustaining-cost per ounce of $680. Realized metal prices during the quarter averaged $1,990 per ounce gold*. The Company recorded net income of $3.6 million, or $0.15 per share and reported cash and cash equivalents at quarter end of $46.9 million. The Company produced 9,684 ounces of gold during the quarter, 21,171 ounces of gold year-to-date, and maintains its 2023 Annual Outlook targeting 40,000 gold ounces (a range of 36,000 to 40,000 ounces).

“The second quarter was another solid quarter of production which positions the Company at the high-end of our annual production target,” stated Mr. Jason Reid, CEO and President of Fortitude Gold.  “Additional quarter highlights include strong financial performance, low all-in production costs and over $6 million invested in exploration.  In addition to our regular instituted monthly cash dividend, we declared our first special cash dividend to shareholders.  By doing so we demonstrate our commitment to return as much cash back to shareholders as soon as possible while balancing the needs of the operations, exploration and growth, and paying taxes as a profitable mining company.”

Mr. Reid continued, “Our Plan of Operations for the County Line project was submitted to the Bureau of Land Management during the quarter.  We also expect to submit a Plan of Operations for our Golden Mile project in the coming weeks as we push both projects through the production permitting cycle as quickly as possible.”


The following Production Statistics table summarize certain information about our operations for the three and six months ended June 30, 2023 and 2022:

    

    

Three months ended June 30, 

Six months ended June 30, 

    

2023

    

2022

    

2023

    

2022

Ore mined

 

  

 

  

 

  

 

  

Ore (tonnes)

 

112,834

 

123,810

 

219,309

 

377,653

Gold grade (g/t)

 

3.36

 

3.46

 

3.71

 

2.59

Low-grade stockpile

 

  

 

  

 

  

 

  

Ore (tonnes)

 

 

11,011

 

61,854

 

34,501

Gold grade (g/t)

 

 

0.42

 

0.47

 

0.43

Waste (tonnes)

 

312,614

 

241,500

 

530,741

 

1,494,024

Metal production (before payable metal deductions)(1)

 

  

 

  

 

  

 

  

Gold (ozs.)

 

9,684

 

10,980

 

21,171

 

20,855

Silver (ozs.)

 

13,611

 

16,027

 

31,260

 

32,550

(1)The difference between what we report as “metal production” and “metal sold” is attributable to the difference between the quantities of metals contained in the doré we produce versus the portion of those metals actually paid for according to the terms of our sales contracts. Differences can also arise from inventory changes incidental to shipping schedules, or variances in ore grades and recoveries which impact the amount of metals contained in doré produced and sold.

The following Sales Statistics table summarizes certain information about our operations for three and six months ended June 30, 2023 and 2022:

    

    

Three months ended June 30, 

Six months ended June 30, 

    

2023

    

2022

    

2023

    

2022

Metal sold

  

  

  

  

Gold (ozs.)

9,702

 

12,851

21,131

 

21,148

Silver (ozs.)

13,464

 

18,780

30,944

 

32,708

Average metal prices realized (1)

  

 

  

  

 

  

Gold ($per oz.)

1,990

 

1,876

1,935

 

1,871

Silver ($per oz.)

24.46

 

23.04

23.42

 

23.34

Precious metal gold equivalent ounces sold

Gold Ounces

9,702

12,851

21,131

21,148

Gold Equivalent Ounces from Silver

165

231

375

408

9,867

13,082

21,506

21,556

Total cash cost before by-product credits per gold ounce sold

$

561

$

680

$

546

$

706

Total cash cost after by-product credits per gold ounce sold

$

527

$

646

$

512

$

670

Total all-in sustaining cost per gold ounce sold

$

680

$

733

$

625

$

778

(1)Average metal prices realized vary from the market metal prices due to final settlement adjustments from our provisional invoices when they are settled. Our average metal prices realized will therefore differ from the market average metal prices in most cases.

*Average realized metal prices include final settlement adjustments for previously unsettled provisional sales. Provisional sales may remain unsettled from one quarter into the next. Realized prices will therefore vary from average spot metal market prices upon final settlement.


See Accompanying Tables

The following information summarizes the results of operations for Fortitude Gold Corporation for the three and six months ended June 30, 2023 and 2022, its financial condition at June 30, 2023 and December 31, 2022, and its cash flows for the six months ended June 30, 2023 and 2022. The summary data as of June 30, 2023 and for the three and six months ended June 30, 2023 and 2022 is unaudited; the summary data as of December 31, 2022 is derived from our audited financial statements contained in our annual report on Form 10-K for the year ended December 31, 2022, but do not include the footnotes and other information that is included in the complete financial statements. Readers are urged to review the Company’s Form 10-K in its entirety, which can be found on the SEC's website at www.sec.gov.

The calculation of its cash cost before by-product credits per gold ounce sold, total cash cost after by-product credits per gold ounce sold and total all-in sustaining cost per gold ounce sold contained in this press release are non-GAAP financial measures. Please see "Management's Discussion and Analysis and Results of Operations" contained in the Company’s most recent Form 10-K for a complete discussion and reconciliation of the non-GAAP measures.


FORTITUDE GOLD CORPORATION
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except share and per share amounts)

June 30, 

December 31, 

    

2023

    

2022

(Unaudited)

  

ASSETS

  

  

Current assets:

  

  

Cash and cash equivalents

$

46,913

$

45,054

Gold and silver rounds/bullion

225

Inventories

 

50,709

 

47,155

Prepaid taxes

966

710

Prepaid expenses and other current assets

 

1,261

 

730

Total current assets

 

100,074

 

93,649

Property, plant and mine development, net

 

28,618

 

30,581

Operating lease assets, net

 

2,078

 

3,826

Deferred tax assets

2,300

1,282

Other non-current assets

 

341

 

1,818

Total assets

$

133,411

$

131,156

LIABILITIES AND SHAREHOLDERS' EQUITY

 

  

 

  

Current liabilities:

 

  

 

  

Accounts payable

$

3,619

$

2,524

Operating lease liabilities, current

 

2,078

 

3,826

Mining taxes payable

 

1,512

 

1,857

Other current liabilities

 

947

 

1,324

Total current liabilities

 

8,156

 

9,531

Asset retirement obligations

 

6,102

 

5,863

Other non-current liabilities

 

 

3

Total liabilities

 

14,258

 

15,397

Shareholders' equity:

 

  

 

  

Preferred stock - $0.01 par value, 20,000,000 shares authorized and nil outstanding at June 30, 2023 and December 31, 2022

 

 

Common stock - $0.01 par value, 200,000,000 shares authorized and 24,084,542 shares outstanding at June 30, 2023 and 24,024,542 shares outstanding at December 31, 2022

 

241

 

240

Additional paid-in capital

 

103,893

 

103,731

Retained earnings

 

15,019

 

11,788

Total shareholders' equity

 

119,153

 

115,759

Total liabilities and shareholders' equity

$

133,411

$

131,156


FORTITUDE GOLD CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
For the three and six months ended June 30, 2023 and 2022
(U.S. dollars in thousands, except share and per share amounts)
(Unaudited)

    

Three months ended

Six months ended

June 30, 

June 30, 

    

2023

    

2022

    

2023

    

2022

Sales, net

$

19,219

$

23,993

$

40,759

$

39,354

Mine cost of sales:

 

  

 

  

 

  

 

  

Production costs

 

5,020

 

8,189

 

10,673

 

13,970

Depreciation and amortization

 

2,905

 

4,155

 

6,384

 

6,933

Reclamation and remediation

 

68

 

76

 

140

 

123

Total mine cost of sales

 

7,993

 

12,420

 

17,197

 

21,026

Mine gross profit

 

11,226

 

11,573

 

23,562

 

18,328

Costs and expenses:

 

  

 

  

 

  

 

  

General and administrative expenses

 

1,087

 

1,094

 

2,146

 

2,274

Exploration expenses

 

6,061

 

2,426

 

9,749

 

4,940

Other (income) expense, net

 

(434)

 

65

 

(761)

 

82

Total costs and expenses

 

6,714

 

3,585

 

11,134

 

7,296

Income before income and mining taxes

 

4,512

 

7,988

 

12,428

 

11,032

Mining and income tax expense

 

908

 

1,423

 

2,456

 

1,849

Net income

$

3,604

$

6,565

$

9,972

$

9,183

Net income per common share:

 

  

 

  

 

  

 

  

Basic

$

0.15

$

0.27

$

0.41

$

0.38

Diluted

$

0.15

$

0.27

$

0.41

$

0.38

Weighted average shares outstanding:

 

  

 

  

 

  

 

  

Basic

24,084,542

24,024,542

24,074,312

24,010,061

Diluted

 

24,225,953

 

24,207,185

 

24,219,270

 

24,204,660


FORTITUDE GOLD CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the six months ended June 30, 2023 and 2022
(U.S. dollars in thousands, except share and per share amounts)
(Unaudited)

Six months ended

June 30, 

    

2023

    

2022

Cash flows from operating activities:

 

  

 

  

Net income

$

9,972

$

9,183

Adjustments to reconcile net income to net cash from operating activities:

 

  

 

  

Depreciation and amortization

 

6,430

 

7,011

Stock-based compensation

103

97

Deferred taxes

(1,018)

(650)

Reclamation and remediation accretion

140

123

Other operating adjustments

 

(58)

 

(29)

Changes in operating assets and liabilities:

 

  

 

  

Accounts receivable

 

 

(1,572)

Inventories

 

(2,167)

 

(1,068)

Prepaid expenses and other current assets

 

(531)

 

1,087

Other non-current assets

 

 

(31)

Accounts payable and other accrued liabilities

 

519

 

176

Income and mining taxes payable

 

(601)

 

194

Net cash provided by operating activities

 

12,789

 

14,521

Cash flows from investing activities:

 

  

 

  

Capital expenditures

 

(3,974)

 

(8,052)

Other investing activities

(239)

Net cash used in investing activities

 

(4,213)

 

(8,052)

Cash flows from financing activities:

 

  

 

  

Dividends paid

(6,741)

(5,763)

Proceeds from exercise of stock options

60

63

Repayment of loans payable

 

(30)

 

(43)

Repayment of capital leases

 

(6)

 

(13)

Net cash used in financing activities

 

(6,717)

 

(5,756)

Net increase in cash and cash equivalents

 

1,859

 

713

Cash and cash equivalents at beginning of period

 

45,054

 

40,017

Cash and cash equivalents at end of period

$

46,913

$

40,730

Supplemental Cash Flow Information

 

  

 

  

Income and mining taxes paid

$

4,074

$

2,339

Non-cash investing and financing activities:

 

  

 

  

Change in capital expenditures in accounts payable

$

231

$

322

Change in estimate for asset retirement costs

$

$

517

Right-of-Use assets acquired through operating lease

$

$

3,899


About Fortitude Gold Corporation

Fortitude Gold is a U.S. based gold producer targeting projects with low operating costs, high margins, and strong returns on capital. The Company’s strategy is to grow organically, remain debt-free and distribute substantial dividends. The Company’s Nevada Mining Unit consists of five high-grade gold properties located in the Walker Lane Mineral Belt and a sixth high-grade gold property in west central Nevada. The Isabella Pearl gold mine, located on the Isabella Pearl mineralized trend, is currently in production. Nevada, U.S.A. is among the world’s premier mining friendly jurisdictions.

Cautionary Statements:  This press release contains forward-looking statements that involve risks and uncertainties. If you are risk-averse you should NOT buy shares in Fortitude Gold Corp.  The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. When used in this press release, the words “plan”, “target”, "anticipate," "believe," "estimate," "intend" and "expect" and similar expressions are intended to identify such forward-looking statements.  Such forward-looking statements include, without limitation, the statements regarding the Company’s strategy, future plans for production, future expenses and costs, future liquidity and capital resources, and estimates of mineralized material are forward-looking statements.  All forward-looking statements in this press release are based upon information available to the Company on the date of this press release, and the Company assumes no obligation to update any such forward-looking statements.  Forward looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate.  The Company's actual results could differ materially from those discussed in this press release.

Contact:
Greg Patterson
719-717-9825
greg.patterson@fortitudegold.com
www.Fortitudegold.com


v3.23.2
Document and Entity Information
Aug. 01, 2023
Cover [Abstract]  
Document Type 8-K
Document Period End Date Aug. 01, 2023
Securities Act File Number 333-249533
Entity Registrant Name FORTITUDE GOLD CORPORATION
Entity Incorporation, State or Country Code CO
Entity Tax Identification Number 85-2602691
Entity Address, Address Line One 2886 Carriage Manor Point
Entity Address, City or Town Colorado Springs
Entity Address, State or Province CO
Entity Address, Postal Zip Code 80906
City Area Code 719
Local Phone Number 717-9825
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security N/A
Trading Symbol N/A
Entity Emerging Growth Company true
Entity Ex Transition Period true
Entity Central Index Key 0001828377
Amendment Flag false
v3.23.2
N-2
Aug. 01, 2023
Cover [Abstract]  
Entity Central Index Key 0001828377
Amendment Flag false
Securities Act File Number 333-249533
Document Type 8-K
Entity Registrant Name FORTITUDE GOLD CORPORATION
Entity Address, Address Line One 2886 Carriage Manor Point
Entity Address, City or Town Colorado Springs
Entity Address, State or Province CO
Entity Address, Postal Zip Code 80906
City Area Code 719
Local Phone Number 717-9825
Entity Emerging Growth Company true
Entity Ex Transition Period true

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