1 "Cash Flow" refers to "Cash flow from operating activities before changes in non-cash operating working capital and other items". |
2 GEOs are based on a conversation ratio of 85:1 for silver to gold for 2021 and 80:1 for 2020. The silver to gold conversation ratio is based on the three-year trailing average silver to gold ratios. These are the referenced ratios for each year throughout the press release. |
3 Please refer to the section entitled "Non-IFRS Measures" for a discussion of these Non-IFRS Measures. |
Key operating and financial statistics for the third quarter of 2021 are outlined in the following table:
3 Months Ended | 9 Months Ended | |||||
2021 | 2020 | Change | 2021 | 2020 | Change | |
Financial Data (in millions except for earning per share) | ||||||
Revenue | 15% | 53% | ||||
Gross profit | (8%) | 53% | ||||
Net income (loss) | 12% | ( | 1779% | |||
Earnings (loss) per share - basic | —% | ( | 1150% | |||
Adjusted net income1 | 43% | 65% | ||||
Adjusted earnings per share – basic1 | 50% | 14% | ||||
Cash flow from operating activities before changes in non-cash operating working capital and other items | 37% | 92% | ||||
Cash and cash equivalents | (6%) | (6%) | ||||
Gold Production and Cost Data | ||||||
GEOs loaded to the pads2 | 111,584 | 120,392 | (7%) | 355,818 | 257,881 | 38% |
GEOs projected recoverable2,3 | 64,768 | 61,224 | 6% | 199,088 | 125,613 | 58% |
GEOs produced2,4 | 58,777 | 48,951 | 20% | 182,230 | 122,018 | 49% |
GEOs sold2 | 60,606 | 49,291 | 23% | 185,372 | 125,691 | 47% |
Average realized sales price | 1,789 | 1,915 | (7%) | 1,788 | 1,750 | 2% |
Cash cost per gold ounce sold1 | (2%) | (1%) | ||||
All-in sustaining cost per gold ounce sold1 | (14%) | (4%) |
1Please refer to the section below entitled "Non-IFRS Measures" for a discussion of these Non-IFRS Measures. |
2GEOs are based on a conversion ratio of 85:1 for silver to gold for 2021 and 80:1 for 2020.. The silver to gold conversion ratio is based on the three-year trailing average silver to gold ratio. |
3Expected recoverable GEOs are based on the assumptions and parameters as set forth in the El Castillo Complex Technical Report dated |
4Produced ounces are calculated as ounces loaded to carbon. |
Third Quarter 2021 and Recent Company Highlights:
- Corporate
- Generated
$39.6 million of cash flow from operating activities before changes in non-cash operating working capital and other items. - Increased net income and adjusted net income 12% and 43%, respectively, compared to the third quarter of 2020 (see Non-IFRS Measures section).
- Acquired key mineral concessions surrounding the
San Agustin mine for$5.75 million that more than quadruples the mineral tenure in theSan Agustin district (see press release datedOctober 12, 2021 ). - Strengthened the management team in
Mexico with the appointment ofAlfredo Phillips as Vice President, Corporate Affairs & Country Manager. In this role,Mr. Phillips will be responsible for leading government relations and ESG strategy and execution in Mexico. - On
September 23, 2021 , completed a non-brokered private placementQuebec flow-through financing for gross proceeds ofC$1.8 million at a price ofC$3.85 per flow-through share , representing a 30% premium to the previous day closing price ofC$2.96 per share. - The proceeds will be used to fund Argonaut's portion of eligible exploration expenditures for its 50/50 joint venture with Troilus Gold Corp. on exploration properties within the Troilus district of
Quebec, Canada . - Social Responsibility
- Construction of water wells in communities near the
El Castillo Complex . - Repair of roads and the maintenance of local sports stadiums in the communities near the
La Colorada mine. - Participated in a food drive initiative at the Tri-County Fair in the community near the
Florida Canyon mine. El Castillo Complex - Third quarter production of 28,872 GEOs, an increase of 8% compared to the third quarter of 2020.
El Castillo production of 11,246 GEOs, an increase of 18% compared to the third quarter of 2020.San Agustin production of 17,626 GEOs, an increase of 2% compared to the third quarter of 2020.La Colorada - Third quarter production of 15,802 GEOs, an increase of 44% compared to the third quarter of 2020.
- Reduction in cash cost per gold ounce sold of 24% compared to the third quarter of 2020 (see "Non-IFRS Measures" section).
- Continued to discover high-grade gold mineralization below the El Crestón pit, including 4.6 metres at 51.9 g/t Au and 28.5 g/t Ag (see press release dated
September 13, 2021 ). Florida Canyon - Third quarter production of 14,103 GEOs, an increase of 25% compared to the third quarter of 2020.
- Reduction in cash cost per gold ounce sold of 16% compared to the third quarter of 2020 (see "Non-IFRS Measures" section).
- Magino
- Construction
- All internal coffer dams are completed.
- Plant site construction is underway.
- Construction of the Tailings Management Facility ("TMF") has commenced.
- Commenced and completed some sections of concrete pouring, forms, and rebar.
- Completed final section of pre-shear drilling in open pit, which allows for TMF material to be accessed and sourced.
- Completed TMF access roads.
- Completed detailed backfill for leach tanks.
- Completed main haul road section.
- Completed installation of 21 ground water monitoring wells.
- Completed winterizing of crushing plant.
- Continued reverse circulation (RC) ore control drilling.
- Community & Permitting
- Monthly meetings to provide environmental updates to its Indigenous partners: Michipicoten First Nation,
Batchewana First Nation , Missanabie Cree First Nation, Métis Nation ofOntario , Red Sky Métis Independent Nation, andGarden River First Nation . - Hosted a groundbreaking ceremony at Magino with members of Indigenous communities, local mayors and Minister
Greg Rickford , theOntario Minister ofNorthern Development , Mines, Natural Resources and Forestry. - Hosted various site tours, including tours with the
Town of Dubreuilville , theAlgoma Workforce Investment Corporation and members of the Regional Employment Help Centre. - Site visit from the
Ministry of the Environment, Conservation and Parks with no issues identified. - Wawa Chief
Building Officer inspector performed final walkthrough of 458-person camp. - Groundwater monitoring well work has commenced.
- Completed the installation of the air monitoring station, which is now operational.
- Started biological fieldwork (sediment, benthic and fish tissue sampling) as well as on-going hydrometric monitoring.
- Fish habitat compensation progressing with fish relocation crew on site.
- Exploration
- Continue to discover high-grade gold mineralization, including 7.0 metres at 13.3 g/t Au in the
South Zone approximately 1.5 kilometres from the border between Magino and Island Gold (see press release datedJuly 8, 2021 ). - Monthly Newsletter
- Argonaut continues to issue a monthly newsletter to provide its stakeholders with regular Magino project updates. To receive monthly newsletters, please register your email at www.argonautgold.com or to view recently issued newsletters, please visit https://www.argonautgold.com/English/assets/development/magino/default.aspx
Cerro del Gallo - Received notice from SEMARNAT, the federal environmental regulatory agency in
Mexico , that the mandatory time in which it has to make an environmental permit decision had expired. SEMARNAT also provided the Company with requests for additional information within this notice, and the Company is in the process of preparing a new permit application for the project to provide more detail relating to the information requests.
Financial Results – Third Quarter 2021
Revenue for the third quarter of 2021 was
Net income for the third quarter of 2021 was
Adjusted net income for the third quarter of 2021 was
Cash flows from operating activities before changes in non-cash operating working capital and other items totaled
Financial Results – First Nine Months 2021
Revenue for the first nine months of 2021 was
Net income for the nine months ended
Adjusted net income for the nine months ended
Operational Results – Third Quarter 2021
During the third quarter 2021, the Company achieved production of 58,777 GEOs at a cash cost of
THIRD QUARTER 2021 EL CASTILLO COMPLEX OPERATING STATISTICS
3 Months Ended | 9 Months Ended | |||||
2021 | 2020 | % Change | 2021 | 2020 | % Change | |
Mining (in 000s except waste/ore ratio) | ||||||
Tonnes ore | 2,143 | 2,874 | (25%) | 7,043 | 5,698 | 24% |
Tonnes ore | 2,598 | 2,573 | 1% | 8,186 | 6,454 | 27% |
Tonnes ore | 4,741 | 5,447 | (13%) | 15,229 | 12,152 | 25% |
Tonnes waste | 1,858 | 2,240 | (17%) | 7,468 | 6,424 | 16% |
Tonnes waste | 1,519 | 1,814 | (16%) | 5,031 | 4,267 | 18% |
Tonnes waste | 3,377 | 4,054 | (17%) | 12,499 | 10,691 | 17% |
Tonnes mined | 4,001 | 5,114 | (22%) | 14,511 | 12,122 | 20% |
Tonnes mined | 4,117 | 4,387 | (6%) | 13,217 | 10,721 | 23% |
Tonnes mined | 8,118 | 9,501 | (15%) | 27,728 | 22,843 | 21% |
Tonnes per day | 44 | 56 | (22%) | 53 | 44 | 21% |
Tonnes per day | 45 | 48 | (7%) | 49 | 39 | 25% |
Tonnes per day | 88 | 104 | (15%) | 102 | 83 | 23% |
Waste/ore ratio | 0.87 | 0.78 | 12% | 1.06 | 1.13 | (6%) |
Waste/ore ratio | 0.58 | 0.71 | (18%) | 0.61 | 0.66 | (8%) |
Waste/ore ratio | 0.71 | 0.74 | (4%) | 0.82 | 0.88 | (7%) |
Leach Pads (in 000s) | ||||||
Tonnes crushed to East leach pads | 0 | 59 | (100%) | 0 | 337 | (100%) |
Tonnes crushed to West leach pads | 0 | 0 | –% | 0 | 3 | (100%) |
Tonnes direct to leach pads | 2,153 | 2,874 | (25%) | 7,043 | 5,509 | 28% |
Tonnes crushed to leach pads | 2,639 | 2,616 | 1% | 8,583 | 6,540 | 31% |
Tonnes to leach pads | 4,792 | 5,549 | (14%) | 15,626 | 12,389 | 26% |
Production | ||||||
Gold grade loaded to leach pads | 0.28 | 0.36 | (22%) | 0.27 | 0.44 | (39%) |
Gold grade loaded to leach pads | 0.30 | 0.31 | (3%) | 0.29 | 0.33 | (12%) |
Gold grade loaded to leach pads (g/t)1 | 0.29 | 0.34 | (15%) | 0.28 | 0.38 | (26%) |
Gold loaded to leach pads | 19,455 | 34,281 | (43%) | 61,603 | 82,138 | (25%) |
Gold loaded to leach pads | 25,108 | 25,789 | (3%) | 81,299 | 69,653 | 17% |
Gold loaded to leach pads (oz)2 | 44,563 | 60,070 | (26%) | 142,902 | 151,791 | (6%) |
Projected recoverable GEOs loaded | 10,260 | 13,259 | (23%) | 30,856 | 31,878 | (3%) |
Projected recoverable GEOs loaded | 18,397 | 19,350 | (5%) | 58,740 | 51,081 | 15% |
Projected recoverable GEOs loaded4 | 28,657 | 32,609 | (12%) | 89,596 | 82,959 | 8% |
Gold produced | 11,123 | 9,329 | 19% | 35,818 | 32,915 | 9% |
Gold produced | 16,258 | 16,192 | —% | 51,634 | 42,430 | 22% |
Gold produced (oz)2 | 27,381 | 25,521 | 7% | 87,452 | 75,345 | 16% |
Silver produced | 10,448 | 12,875 | (19%) | 49,688 | 55,967 | (11%) |
Silver produced | 116,309 | 80,414 | 45% | 397,210 | 225,160 | 76% |
Silver produced (oz)2,3 | 126,757 | 93,289 | 36% | 446,898 | 281,127 | 59% |
GEOs produced | 11,246 | 9,492 | 18% | 36,403 | 33,615 | 8% |
GEOs produced | 17,626 | 17,198 | 2% | 56,307 | 45,245 | 24% |
GEOs produced3 | 28,872 | 26,690 | 8% | 92,710 | 78,860 | 18% |
Gold sold | 10,473 | 9,318 | 12% | 36,689 | 33,952 | 8% |
Gold sold | 17,611 | 14,312 | 23% | 53,106 | 42,066 | 26% |
Gold sold (oz)2 | 28,084 | 23,630 | 19% | 89,795 | 76,018 | 18% |
Silver sold | 11,835 | 12,875 | (8%) | 52,046 | 55,967 | (7%) |
Silver sold | 121,993 | 70,368 | 73% | 395,781 | 226,547 | 75% |
Silver sold (oz)2 | 133,828 | 83,243 | 61% | 447,827 | 282,514 | 59% |
GEOs sold | 10,612 | 9,479 | 12% | 37,301 | 34,652 | 8% |
GEOs sold | 19,046 | 15,191 | 25% | 57,762 | 44,897 | 29% |
GEOs sold | 29,658 | 24,670 | 20% | 95,063 | 79,549 | 20% |
Cash cost per gold ounce sold | 31% | 15% | ||||
Cash cost per gold ounce sold | 23% | 11% | ||||
Cash cost per gold ounce sold5 | 38% | 12% |
1 "g/t" refers to grams per tonne. |
2 "oz" refers to troy ounce. |
3 Produced ounces are calculated as ounces loaded to carbon. |
4 Expected recoverable GEOs are based on the assumptions and parameters as set forth in the El Castillo Complex Technical Report dated |
5 Please refer to the section below entitled "Non-IFRS Measures" for a discussion of this Non-IFRS Measure. |
Summary of Production Results at the
During the third quarter of 2021, the
THIRD QUARTER 2021 LA COLORADA OPERATING STATISTICS
3 Months Ended | 9 Months Ended | |||||
2021 | 2020 | % Change | 2021 | 2020 | % Change | |
Mining (in 000s except for waste/ore ratio) | ||||||
Tonnes ore | 1,224 | 1,203 | 2% | 3,601 | 2,656 | 36% |
Tonnes waste | 1,974 | 3,909 | (50%) | 8,161 | 10,329 | (21%) |
Tonnes mined | 3,198 | 5,112 | (37%) | 11,762 | 12,985 | (9%) |
Tonnes per day | 35 | 56 | (38%) | 43 | 47 | (8%) |
Waste/ore ratio | 1.61 | 3.25 | (50%) | 2.27 | 3.89 | (42%) |
Leach Pads (in 000s) | ||||||
Tonnes crushed to leach pads | 1,255 | 1,242 | 1% | 3,768 | 2,726 | 38% |
Production | ||||||
Gold loaded to leach pads (g/t)1 | 0.67 | 0.46 | 46% | 0.66 | 0.42 | 57% |
Gold loaded to leach pads (oz)2 | 27,009 | 18,332 | 47% | 79,420 | 36,402 | 118% |
Projected recoverable GEOs loaded4 | 22,066 | 14,548 | 52% | 63,801 | 28,586 | 123% |
Gold produced (oz)2,3 | 15,360 | 10,409 | 48% | 47,975 | 30,295 | 58% |
Silver produced (oz)2,3 | 37,590 | 45,060 | (17%) | 138,647 | 125,929 | 10% |
GEOs produced3 | 15,802 | 10,972 | 44% | 49,606 | 31,869 | 56% |
Gold sold (oz)2 | 15,332 | 10,283 | 49% | 46,661 | 30,771 | 52% |
Silver sold (oz)2 | 35,408 | 39,932 | (11%) | 132,999 | 122,540 | 9% |
GEOs sold | 15,749 | 10,782 | 46% | 48,226 | 32,303 | 49% |
Cash cost per gold ounce sold5 | (24%) | (33%) |
1 "g/t" refers to grams per tonne. |
2 "oz" refers to troy ounce. |
3 Produced ounces are calculated as ounces loaded to carbon. |
4 Expected recoverable GEOs are based on the assumptions and parameters as set forth in the La Colorada Gold/Silver Mine Technical Report dated |
5 Please refer to the section below entitled "Non-IFRS Measures" for a discussion of this Non-IFRS Measure. |
Summary of Production Results at
During the third quarter of 2021, the
THIRD QUARTER 2021 FLORIDA CANYON OPERATING STATISTICS
3 Months Ended | |||
2021 | 2020 | % Change | |
Mining (in 000s except for waste/ore ratio) | |||
Tonnes ore | 1,931 | 2,095 | (8%) |
Tonnes waste | 3,165 | 2,847 | 11% |
Tonnes mined | 5,096 | 4,942 | 3% |
Tonnes per day | 55 | 53 | 3% |
Waste/ore ratio | 1.64 | 1.36 | 21% |
Leach Pads (in 000s) | |||
Tonnes crushed to leach pads | 1,673 | 1,925 | (13%) |
Tonnes direct to leach pads | 270 | 228 | 18% |
Production | |||
Gold grade loaded to leach pads (g/t)1 | 0.34 | 0.29 | 17% |
Gold loaded to leach pads (oz)2 | 21,409 | 19,757 | 8% |
Projected recoverable GEOs loaded4 | 14,045 | 14,067 | —% |
Gold produced (oz)2,3 | 14,030 | 11,204 | 25% |
Silver produced (oz)2,3 | 6,173 | 6,798 | (9%) |
GEOs produced3 | 14,103 | 11,289 | 25% |
Gold sold (oz)2 | 15,112 | 13,738 | 10% |
Silver sold (oz)2 | 7,355 | 8,067 | (9%) |
GEOs sold | 15,199 | 13,839 | 10% |
Cash cost per gold ounce sold5 | (16%) |
1 "g/t" refers to grams per tonne. |
2 "oz" refers to troy ounce. |
3 Produced ounces are calculated as ounces loaded to carbon. |
4 Expected recoverable GEOs are based on the assumptions and parameters as set forth in the Florida Canyon Mine Technical Report dated |
5 Please refer to the section below entitled "Non-IFRS Measures" for a discussion of this Non-IFRS Measure. |
Summary of Production Results at
As Argonaut did not own nor operate the
During the third quarter of 2021, the
Guidance and Outlook
Argonaut is tracking towards the upper half of its 2021 GEO production guidance and the lower half of its 2021 cost guidance. The table below outlines the nine month ended
2021 PRODUCTION AND COST GUIDANCE
9 Months Ended | Full Year 2021 Guidance | |
GEO production | 182,230 | 210,000 – 250,000 |
Cash cost per gold ounce sold1 | ||
AISC per gold ounce sold1 |
1 Please refer to the section below entitled "Non-IFRS Measures" for a discussion of this Non-IFRS Measure. |
The Magino construction project is tracking on schedule. During the three and nine months ended
While the Magino construction project remains on schedule, Argonaut is in the midst of a review of the impacts of COVID-19, foreign currency exchange rates, contingencies, potential adjustments to the development plans and cost inflation to certain inputs related to the initial capital estimate (excluding ramp-up capital) which it believes will exceed the 15% above the original guidance of between
2021 capital spend, excluding the Magino construction project, is tracking within the 2021 capital guidance range of between
Argonaut Gold Third Quarter 2021 Operational and Financial Results Conference Call and Webcast:
The Company will host the third quarter 2021 conference call and webcast at
Conference Call Information
Toll Free ( | 1-888-664-6392 |
International: | 1-416-764-8659 |
Conference ID: | 80837957 |
Webcast: | www.argonautgold.com |
Conference Call Replay:
Toll Free Replay Call ( | 1-888-390-0541 |
International Replay Call: | 1-416-764-8677 |
Replay Entry Code: | 837957# |
The conference call replay will be available from
Non-IFRS Measures
The Company has included certain non-IFRS measures including "Cash cost per gold ounce sold", "All-in sustaining cost per gold ounce sold", "Adjusted net income", and "Adjusted earnings per share – basic" in this press release to supplement its financial statements, which are presented in accordance with International Financial Reporting Standards ("IFRS"). Cash cost per gold ounce sold is equal to production costs less silver sales divided by gold ounces sold. All-in sustaining cost per gold ounce sold is equal to production costs less silver sales plus general and administrative, exploration, accretion and other expenses and sustaining capital expenditures divided by gold ounces sold. Adjusted net income is equal to net income less foreign exchange impacts on deferred income taxes, foreign exchange (gains) losses, non-cash impairment write down (reversal) of work-in-process inventory, unrealized (gains) losses on commodity derivatives and care and maintenance expenses. Adjusted earnings per share – basic is equal to adjusted net income divided by the basic weighted average number of common shares outstanding. The Company believes that these measures provide investors with an alternative view to evaluate the performance of the Company. Non-IFRS measures do not have any standardized meaning prescribed under IFRS. 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.
Please see the management's discussion and analysis ("MD&A") for full disclosure on non-IFRS measures.
This press release should be read in conjunction with the Company's unaudited interim condensed consolidated financial statements for the three and nine months ended
Cautionary Note Regarding Forward-looking Statements
This press release contains certain "forward-looking statements" and "forward-looking information" under applicable Canadian securities laws concerning the business, operations and financial performance and condition of
Factors that could cause actual results to vary materially from results anticipated by such forward-looking statements include variations in ore grade or recovery rates, changes in market conditions, risks relating to the availability and timeliness of permitting and governmental approvals; risks relating to international operations, fluctuating metal prices and currency exchange rates, changes in project parameters, the possibility of project cost overruns or unanticipated costs and expenses, labour disputes and other risks of the mining industry, failure of plant, equipment or processes to operate as anticipated.
These factors are discussed in greater detail in Argonaut's most recent Annual Information Form and in the most recent Management's Discussion and Analysis filed on SEDAR, which also provide additional general assumptions in connection with these statements. Argonaut cautions that the foregoing list of important factors is not exhaustive. Investors and others who base themselves on forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. Argonaut believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These statements speak only as of the date of this press release.
Although Argonaut has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Argonaut undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements. Statements concerning mineral reserve and resource estimates may also be deemed to constitute forward-looking statements to the extent they involve estimates of the mineralization that will be encountered if the property is developed. Comparative market information is as of a date prior to the date of this document.
Qualified Person, Technical Information and Mineral Properties Reports
Technical information included in this release was supervised and approved by
NI 43-101 Technical Report on Resources and Reserves, | |
NI 43-101 Technical Report on Resources and Reserves, | |
NI 43-101 Technical Report on Mineral Resource and Mineral Reserve Florida Canyon Gold Mine | |
Feasibility Study Technical Report on the | |
Pre-Feasibility Study Technical Report on the |
About
For more information, contact:
Vice President, Corporate Development & Investor Relations
Phone: 416-915-3107
Email: dan.symons@argonautgold.com
Source:
SOURCE
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