TORONTO, Nov. 8, 2017 /CNW Telbec/ - Richmont Mines
Inc. (TSX: RIC) (NYSE: RIC) ("Richmont" or the "Corporation")
announces operating and financial results for the three and nine
months ended September 30, 2017.
(All amounts are in Canadian dollars, unless otherwise
indicated.)
THIRD QUARTER AND NINE-MONTH HIGHLIGHTS - CONTINUING
OPERATIONS(1)
- Revenues of $36.5 (US$29.2) million for the quarter and
$123.4 (US$94.3) million for the nine-month period.
- Net earnings of $4.8 (US$3.8) million, or $0.08 (US$0.06) per
share for the quarter and $21.7
(US$16.6) million, or $0.34 (US$0.26) per
share for the nine-month period.
- Record production of 26,659 ounces of gold (22,666 ounces sold)
for the quarter and 76,541 ounces of gold (74,849 ounces sold) for
the nine-month period, positioning the Island Gold Mine to exceed
the high end of annual production guidance of between 87,000 and
93,000 ounces.
- Cash costs(2) of $666
(US$532) per ounce for the quarter
and $637 (US$487) per ounce for the nine-month period. The
Island Gold Mine remains on track to beat the lower end of annual
cash cost guidance of between $715 and
$765 (US$550 to US$590) per
ounce.
- All-In-Sustaining Costs(2) ("AISC") for the Island
Gold Mine were $886 (US$708) per ounce for the quarter and
$796 (US$609) per ounce for the nine-month period. The
Island Gold Mine remains on track to beat the lower end of annual
AISC guidance of between $945 and
$995 (US$725 and US$765) per
ounce.
- AISC for continuing operations, including all corporate
overhead, was $1,038 (US$829) per ounce for the quarter and
$921 (US$704) per ounce for the nine-month
period.
- Operating cash flow from the Island Gold Mine was $14.5 (US$11.6)
million for the quarter and $62.2 (US$47.5)
million for the nine-mine period. Operating cash
flow(2) (before changes in non-cash working capital),
including all corporate overhead, was $11.5 (US$9.2)
million for the quarter, or $0.18 (US$0.14) per
share, and $50.6 (US$38.7) million for the nine-month period, or
$0.80 (US$0.61) per share.
- The Island Gold Mine generated strong free cash flow of
$4.4 (US$3.5)
million for the quarter and $31.8 (US$24.3)
million for the nine-month period. Net free cash
flow(2), including all corporate overhead, was
$1.8 (US$1.4)
million for the quarter, or $0.03 (US$0.02) per
share, and $21.0 (US$16.0) million for the nine-month period, or
$0.33 (US$0.25) per share.
- Cash balance at the end of the quarter was approximately
$90.0 (US$72.1) million. As a result of timing, the
finished goods inventory at the end of the quarter consisted of
approximately 2,000 gold ounces. These ounces were sold in the
fourth quarter.
- Year to date, Island Gold has continued to outperform the 2017
Expansion Case Preliminary Economic Assessment ("PEA") on all key
metrics, which demonstrates the significant upside potential of
this asset.
- The mill expansion to 1,100 tonnes per day advanced during the
quarter and the operation is anticipated to achieve the target run
rate in the latter part of 2018.
- On September 11, 2017, Richmont
announced that it had entered into a definitive agreement with
Alamos Gold ("Alamos") whereby Alamos will acquire all of the
issued and outstanding shares of Richmont pursuant to a plan of
arrangement. The transaction is expected to close on, or about,
November 23, 2017.
"The positive results we have reported were supported by another
consecutive quarter of solid performance from the Island Gold Mine.
This high-quality operation delivered record production at peer
leading cash costs, which positions Island Gold to beat annual
guidance for the third consecutive year. Year to date, the Island
Gold Mine has generated a strong free cash flow stream of
$31.8 million, which will increase
significantly once the level of capital investment decreases to
sustaining levels post 2018," commented Renaud Adams, President and CEO. He continued,
"During the quarter, we announced a transaction with Alamos that is
consistent with our commitment to create significant shareholder
value. As part of this strategic transaction, our shareholders will
maintain exposure to the ongoing potential of the Island Gold Mine
and benefit from having meaningful ownership in a diversified
intermediate producer with a proven and experienced management
team."
_______________________
|
1
|
Continuing operations
includes the Island Gold Mine and corporate overhead. The Beaufor
Mine, the Camflo Mill, the Monique Mine, the Wasamac development
project and all other mineral claims, mining leases and mining
concessions located in the province of Quebec are reported as
discontinued operations. Refer to the Q3 Management's Discussion
and Analysis for further details.
|
2
|
Refer to the Non-IFRS
Performance Measures disclosure presented at the end of this press
release.
|
Financial and
Operating Highlights - Continuing
Operations(1)
|
|
(in thousands of
$, except per share and per oz amounts)
|
Quarter
ended
Sept. 30,
2017
|
Quarter
ended
Sept. 30,
2016
|
Nine-Months
ended
Sept. 30,
2017
|
Nine-Months
ended
Sept. 30,
2016
|
Gold produced
(oz)
|
26,659
|
14,031
|
76,541
|
59,237
|
Gold sold
(oz)
|
22,666
|
13,673
|
74,849
|
59,851
|
Cash costs per ounce
($)(2)
|
666
|
947
|
637
|
761
|
AISC per ounce
($)(2)
|
1,038
|
1,463
|
921
|
1,134
|
Realized gold price
per ounce ($)
|
1,608
|
1,756
|
1,644
|
1,657
|
Revenue from mining
operations
|
36,549
|
24,053
|
123,363
|
99,378
|
Net earnings (per
share)
|
0.08
|
0.01
|
0.34
|
0.18
|
Operating cash flow,
per share(2)
|
0.19
|
0.05
|
0.81
|
0.53
|
Operating cash flow
(before non-cash changes in working capital), per
share(2)
|
0.18
|
0.08
|
0.80
|
0.59
|
Sustaining Capital
($)
|
4,984
|
5,090
|
11,933
|
15,283
|
Project Capital
($)
|
10,042
|
13,457
|
21,941
|
28,390
|
Net free cash flow,
per share(2)
|
0.03
|
(0.24)
|
0.33
|
(0.18)
|
Revenue from mining
operations (US$)
|
29,174
|
18,431
|
94,336
|
75,184
|
Net earnings (per
share) (US$)
|
0.06
|
-
|
0.26
|
0.13
|
Operating cash flow,
per share(2) (US$)
|
0.15
|
0.04
|
0.62
|
0.40
|
Operating cash flow
(before non-cash changes in working capital), per
share(2) (US$)
|
0.14
|
0.06
|
0.61
|
0.45
|
Sustaining Capital
(US$)
|
3,978
|
3,900
|
9,125
|
11,562
|
Project Capital
(US$)
|
8,016
|
10,312
|
16,778
|
21,478
|
Net free cash flow,
per share(2) (US$)
|
0.02
|
(0.18)
|
0.25
|
(0.14)
|
(1)
|
Continuing operations
includes the Island Gold Mine and corporate overhead.
|
(2)
|
Non-IFRS performance
measure. Refer to the Non-IFRS performance measures section
contained in the Q3 2017 Management's Discussion and
Analysis.
|
Island Gold Mine: Operational Highlights
Year to date, the Island Gold Mine has outperformed the PEA on
all key operating and financial metrics including tonnes mined and
milled, grades and unit operating costs, all of which has supported
a significant free cash flow stream of $31.8 (US$24.3)
million.
- Underground mine and mill productivities of 1,028 and 931
tonnes per day year to date (1,055 and 946 tonnes per operating
day), respectively, as compared to the 1,000 tonnes per day and 900
tonnes per day considered in the PEA. Following underground mine
infrastructure improvements completed during the quarter, the mill
is now operating at an average of nearly 1,000 tonnes per day.
- Unit operating costs of $182
(US$139) per tonne, below the
$204 (US$151)/tonne considered in the PEA.
- The mill upgrade to 1,100 tonnes per day mill is currently
underway and advancing well on schedule. A ball mill has been
sourced and is currently being refurbished, detailed engineering
has been completed and earthworks started in the third quarter. The
mill target run rate is anticipated to be achieved in the latter
part of 2018.
- Upgrade of the mining infrastructure to support the expanded
capacity has advanced in the third quarter. Surface fans have been
upgraded to increase mine ventilation and new underground pumping
stations have been commissioned. Additional mining equipment, such
as trucks and scoops, have been ordered with deliveries estimated
for the first half of 2018.
Consolidated
Highlights - Continuing and Discontinued
Operations(1)
|
|
(in thousands of
$, except per share and per oz amounts)
|
Quarter
ended
Sept. 30,
2017
|
Quarter
ended
Sept. 30,
2016
|
Nine-Months
ended
Sept. 30,
2017
|
Nine-Months
Ended
Sept. 30,
2016
|
Gold produced
(oz)
|
30,039
|
18,856
|
90,689
|
74,545
|
Gold sold
(oz)
|
26,287
|
17,774
|
89,855
|
74,901
|
Cash costs per ounce
($)(2)
|
840
|
1,054
|
783
|
892
|
AISC per ounce
($)(2)
|
1,259
|
1,595
|
1,101
|
1,289
|
Realized gold price
per ounce ($)
|
1,608
|
1,754
|
1,644
|
1,659
|
Revenue from mining
operations
|
42,378
|
31,244
|
148,118
|
124,496
|
Net earnings (per
share), basic
|
0.03
|
-
|
0.28
|
0.19
|
Operating cash flow,
per share(2)
|
0.13
|
0.05
|
0.81
|
0.59
|
Operating cash flow
(before non-cash changes in working capital), per
share(2)
|
0.15
|
0.09
|
0.80
|
0.64
|
Net free cash flow,
per share(2)
|
(0.05)
|
(0.26)
|
0.26
|
(0.20)
|
Revenue from mining
operations (US$)
|
33,827
|
23,942
|
113,266
|
94,187
|
Net earnings (per
share) (US$)
|
0.02
|
-
|
0.21
|
0.14
|
Operating cash flow,
per share(2) (US$)
|
0.10
|
0.04
|
0.62
|
0.44
|
Operating cash flow
(before non-cash changes in working capital), per
share(2) (US$)
|
0.12
|
0.07
|
0.61
|
0.48
|
Net free cash flow,
per share(2) (US$)
|
(0.04)
|
(0.20)
|
0.20
|
(0.15)
|
(1)
|
Continuing operations
includes the Island Gold Mine and corporate overhead. The Beaufor
Mine, the Camflo Mill, the Monique Mine, the Wasamac development
project and all other mineral claims, mining leases and mining
concessions located in the province of Quebec are reported as
discontinued operations. Refer to the Q3 Management's Discussion
and Analysis for further details.
|
(2)
|
Non-IFRS performance
measure. Refer to the Non-IFRS performance measures section
contained in the Q3 2017 Management's Discussion and
Analysis.
|
Upcoming News and Events
- Special Meetings of Richmont and Alamos Shareholders
(Nov. 16)
- Closing of the Richmont / Alamos Transaction (on, or about,
Nov. 23)
Financial Statements and Management's Discussion and
Analysis
The financial statements and related Management's
Discussion and Analysis can be found on the Corporation's website
at www.richmont-mines.com or under the Corporation's profile on
www.sedar.com and with the Securities and Exchange Commission at
www.sec.gov/edgar.shtml.
Non-International Financial Reporting Standards ("IFRS")
Performance Measures
In this press release, the terms "cash
costs per ounce", "all-in sustaining costs", "net free cash flow"
and "operating cash flow" are used, which are non-IFRS performance
measures, and may not be comparable to similar measures presented
by other companies. The Corporation believes that, in addition to
conventional measures prepared in accordance with IFRS, the
Corporation and certain investors use this information to evaluate
the Corporation's performance. Accordingly, these non-IFRS measures
are 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. For full disclosure
and reconciliation of these measures, refer to the Non-IFRS
Performance Measures section contained in the Q3 2017 Management's
Discussion and Analysis.
About Richmont Mines Inc.
Richmont Mines currently
produces gold from the Island Gold Mine in Ontario and is also advancing development of
the significant high-grade resource extension to the east and at
depth. With more than 35 years of experience in gold production,
exploration and development, and prudent financial management, the
Corporation has successfully positioned the Island Gold Mine to
cost-effectively build its Canadian reserve base and to enter its
next phase of growth.
Forward-Looking Statements
This news release contains
forward-looking statements that include risks and uncertainties.
When used in this news release, the words "estimate", "project",
"anticipate", "expect", "intend", "believe", "hope", "may",
"objective" and similar expressions, as well as "will", "shall" and
other indications of future tense, are intended to identify
forward-looking statements. The forward-looking statements are
based on current expectations and apply only as of the date on
which they were made. Except as may be required by law or
regulation, the Corporation undertakes no obligation and disclaims
any responsibility to publicly update or revise any forward-looking
statements or information, whether as a result of new information,
future events or otherwise.
The factors that could cause actual results to differ materially
from those indicated in such forward-looking statements include
changes in the prevailing price of gold, the Canadian-United States
exchange rate, grade of ore mined and unforeseen difficulties in
mining operations that could affect revenue and production costs.
Other factors such as uncertainties regarding government
regulations could also affect the results. Other risks may be set
out in Richmont's Annual Information Form, Annual Reports and
periodic reports. The forward-looking information contained herein
is made as of the date of this news release.
Cautionary note to US investors concerning resource
estimates
Information in this press release is intended to
comply with the requirements of the Toronto Stock Exchange and
applicable Canadian securities legislation, which differ in certain
respects with the rules and regulations promulgated under the
United States Securities Exchange Act of 1934, as amended
("Exchange Act"), as promulgated by the United States Securities
and Exchange Commission (the "SEC"). The requirements of National
Instrument 43-101 – Standards of Disclosure for Mineral
Projects ("NI 43-101") adopted by the Canadian Securities
Administrators differ significantly from the requirements of the
SEC.
U.S. Investors are urged to consider the disclosure in our
annual report on Form 40-F, File No. 001-14598, as filed with the
SEC under the Exchange Act, which may be obtained from us (without
cost) or from the SEC's web site: http://sec.gov/edgar.shtml.
National Instrument 43-101
The scientific or technical
information in this news release has been reviewed by Mr.
Daniel Adam, Geo., Ph.D.,
Vice-President, Exploration, an employee of Richmont Mines Inc.,
and a qualified person as defined by NI 43-101.
SOURCE Richmont Mines