Jaguar Mining Inc. today announced financial results for the fourth quarter and full year ended December 31, 2022.
Fourth Quarter Highlights
Revenue decreased 15% to $36.1 million compared with $42.7 million in the fourth quarter of 2021. The decrease was due to a reduction in ounces sold (-10%) and a reduction in realized gold price (-5%), The Company produced 8% less ounces (21,116 vs. 22,903) and with sales of 20,940 ounces in Q4 2022 compared to 23,497 ounces in Q4 of 2021 the Company saw an increase in inventory rather than a decrease.
Gold production decreased by 8% to 21,116 ounces compared to 22,903 ounces in the fourth quarter of 2021. The lower production rate was due to a reduction in tonnes of ore processed of 2% and a decrease in head grade of 5%.
Operating costs totaled $21.4 million an increase of 14% compared to $18.8 million in the fourth quarter of 2021. The increase in operating costs came predominantly from a 29% increase in secondary development combined with the inflationary pressures of the first 6 months of the year.
Cash operating costs1 increased to $1,024 per ounce of gold sold compared to $802 per ounce of gold sold in the fourth quarter of 2021 due to the higher operating costs and the reduction in ounces sold.
All-in sustaining costs1 increased to $1,597 per ounce of gold sold compared to $1,127 per ounce of gold sold in the fourth quarter of 2021 due to the cash cost increase explained above, combined with higher sustaining capital expenditures including: additional primary development, rehabilitating a ventilation raise, and investing in a new fleet of trucks for Turmalina and Pilar which was received at the end of December.
Net income for Q4 2022 increased to $11.5 million, compared with $3.5 million in Q4 2021, which includes an impairment reversal of $10.7 million in Q4 2022 due to the increase in inferred resources, compared with an impairment charge of $10.1 million in Q4 2021. Others major variances included a $6.6 million decline in revenue, $2.6 million increase in operating costs, $1.6 million reduction on foreign exchange gain, and an income tax expense increase of $1.9 million.
Free cash flow1 was $1.5 million and was based on operating cash flow plus asset retirement obligation expenditures, less capital expenditures, compared to $8.2 million in the fourth quarter of 2021. Free cash flow was $72 per ounce of gold sold compared to $348 per ounce of gold sold in the fourth quarter of 2021.
This is a Non-GAAP financial performance measure with no standard definition under IFRS. For more details, refer to the Non-GAAP Performance Measures section of the MD&A.
Full Year Highlights
Revenue decreased 6% to $142.5 million compared with $151.5 million in 2021, primarily due to lower ounces of gold sold of 80,050 ounces as compared to 84,638 ounces in 2021, combined with a decrease in the average realized gold price of $1,780 per ounce compared to $1,790 per ounce in 2021.
Gold production for the year decreased 3% to 80,968 ounces compared to 83,878 ounces produced in 2021.
Operating cash flow of $40.8 million; adjusted EBITDA of $45 million.
Cash operating costs1 increased to $1,052 per ounce of gold sold compared to $831 per ounce of gold sold in 2021 mainly due to the reduction in ounces of gold sold, combined with inflation and an increase in secondary development metres compared to 2021.
All-in sustaining costs1 increased to $1,483 per ounce of gold sold compared to $1,215 in 2021, primarily due to the increase of in cash operating cost1 explained above.
Cash Position and Working Capital1
As at year end, the Company had a cash and cash equivalents position of $25.2 million, compared to $40.4 million as of December 31, 2021.
As at year end, working capital1 was $19.5 million, compared to $32 million as of December 31, 2021, which includes $3 million in short term loans from Brazilian banks.
Vern Baker, President and CEO of Jaguar Mining stated: 'We are pleased to report our fourth quarter and full year financial results for 2022. It was a challenging year. We focused on investing in strengthening our mines, developing the Faina project, and exploration. This investment in exploration, development, equipment, and project engineering are providing the base for our future production. Our primary growth source remains the Faina project where we have been investing in an access ramp, in significant upgrading of the resource through surface drilling, and in progressing engineering to allow full definition of the project. For the year, we kept our total sustaining capital relatively consistent while we were able to rehabilitate a ventilation raise and pay for a significant portion of a new truck fleet for the Pilar mine. We also increased our growth and exploration spending by 90% as we invested strongly into future opportunities.
In 2022, balance sheet strength and free cash flow generation enabled us to invest almost $24 million in growth projects, including advancing the Faina project. We also committed an additional $6 million into our greenfield exploration effort while paying $7 million in dividends. Our cash balance was impacted in the fourth quarter with more development, the rehabilitation of the ventilation raise and the purchase of a new fleet of haul trucks for Pilar. These trucks match a partial fleet we have at Turmalina that have positively impacted performance in our mine haulage.'
About Jaguar Mining Inc.
Jaguar Mining Inc. is a Canadian-listed junior gold mining, development, and exploration company operating in Brazil with three gold mining complexes and a large land package with significant upside exploration potential from mineral claims. The Company's principal operating assets are located in the Iron Quadrangle, a prolific greenstone belt in the state of Minas Gerais and include the Turmalina Gold Mine Complex and Caete Mining Complex (Pilar and Roca Grande Mines, and Caete Plant). The Company also owns the Paciencia Gold Mine Complex, which has been on care and maintenance since 2012. The Roca Grande Mine has been on temporary care and maintenance since April 2019. Additional information is available on the Company's website at www.jaguarmining.com.
Contact:
Tel: 416-847-1854
Forward-Looking Statements
Certain statements in this news release constitute 'forward-looking information' within the meaning of applicable Canadian securities legislation. Forward-looking statements and information are provided for the purpose of providing information about management's expectations and plans relating to the future. All of the forward-looking information made in this news release is qualified by the cautionary statements below and those made in our other filings with the securities regulators in Canada. Forward-looking information contained in forward-looking statements can be identified by the use of words such as 'are expected,' 'is forecast,' 'is targeted,' 'approximately,' 'plans,' 'anticipates,' 'projects,' 'anticipates,' 'continue,' 'estimate,' 'believe' or variations of such words and phrases or statements that certain actions, events or results 'may,' 'could,' 'would,' 'might,' or 'will' be taken, occur or be achieved. All statements, other than statements of historical fact, may be considered to be or include forward-looking information. This news release contains forward-looking information regarding, among other things, expected sales, production statistics, ore grades, tonnes milled, recovery rates, cash operating costs, definition/delineation drilling, the timing and amount of estimated future production, costs of production, capital expenditures, costs and timing of the development of projects and new deposits, success of exploration, development and mining activities, currency fluctuations, capital requirements, project studies, mine life extensions, restarting suspended or disrupted operations, continuous improvement initiatives, and resolution of pending litigation. The Company has made numerous assumptions with respect to forward-looking information contained herein, including, among other things, assumptions about the estimated timeline for the development of its mineral properties; the supply and demand for, and the level and volatility of the price of, gold; the accuracy of reserve and resource estimates and the assumptions on which the reserve and resource estimates are based; the receipt of necessary permits; market competition; ongoing relations with employees and impacted communities; political and legal developments in any jurisdiction in which the Company operates being consistent with its current expectations including, without limitation, the impact of any potential power rationing, tailings facility regulation, exploration and mine operating licenses and permits being obtained and renewed and/or there being adverse amendments to mining or other laws in Brazil and any changes to general business and economic conditions. Forward-looking information involves a number of known and unknown risks and uncertainties, including among others: the risk of Jaguar not meeting the forecast plans regarding its operations and financial performance; uncertainties with respect to the price of gold, labour disruptions, mechanical failures, increase in costs, environmental compliance and change in environmental legislation and regulation, weather delays and increased costs or production delays due to natural disasters, power disruptions, procurement and delivery of parts and supplies to the operations; uncertainties inherent to capital markets in general (including the sometimes volatile valuation of securities and an uncertain ability to raise new capital) and other risks inherent to the gold exploration, development and production industry, which, if incorrect, may cause actual results to differ materially from those anticipated by the Company and described herein. In addition, there are risks and hazards associated with the business of gold exploration, development, mining and production, including environmental hazards, tailings dam failures, industrial accidents and workplace safety problems, unusual or unexpected geological formations, pressures, cave-ins, flooding, chemical spills, procurement fraud and gold bullion thefts and losses (and the risk of inadequate insurance, or the inability to obtain insurance, to cover these risks). Accordingly, readers should not place undue reliance on forward-looking information.
For additional information with respect to these and other factors and assumptions underlying the forward-looking information made in this news release, see the Company's most recent Annual Information Form and Management's Discussion and Analysis, as well as other public disclosure documents that can be accessed under the issuer profile of 'Jaguar Mining Inc.' on SEDAR at www.sedar.com. The forward-looking information set forth herein reflects the Company's reasonable expectations as at the date of this news release and is subject to change after such date. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law. The forward-looking information contained in this news release is expressly qualified by this cautionary statement.
JAGUAR MINING INC. 
