Record gold production, strong operational performance and
second mine well on track for Q4 2019 first pour and ramp up
(All amounts are in U.S. dollars unless otherwise stated)
Toronto, Ontario: February 22, 2019 - Teranga Gold Corporation ("Teranga" or the "Company")
(TSX:TGZ; OTCQX:TGCDF) today reported its operating and financial results for the three and twelve
months ended December 31, 2018. The Company also provided an update on the development of its
second mine, Wahgnion Gold Operations (“Wahgnion”).
“In 2018, we significantly advanced our vision of building a multi-asset mid-tier gold producer in West
Africa,” said Richard Young, President and Chief Executive Officer. “By the end of 2019, we will have two
long-life mines in two jurisdictions capable of producing between 300,000 and 350,000 ounces of gold per
year and a third project, Golden Hill, potentially moving towards feasibility stage development. As well, we
have very prospective land positions in Côte d’Ivoire that could represent the next phase of Teranga’s
longer-term growth.”
OPERATING HIGHLIGHTS
. Fourth quarter 2018 gold production totalled 59,442 ounces, at cost of sales, total cash costs(1) and
all-in sustaining costs(1) marginally higher than the prior year quarter due to lower gold production
. Record full-year gold production of 245,230 ounces, exceeding the high end of Teranga’s increased
2018 production guidance range of 235,000-240,000 ounces
. FY2018 ounce metrics improved year-over-year and beat guidance:
– cost of sales of $937 per ounce (2018 guidance range $950 - $1,025 per ounce)
– total cash costs(1) of $660 per ounce (2018 guidance range $700 - $750 per ounce)
– all-in sustaining costs (excluding non-cash inventory movements and amortized advanced
royalties)(1) of $940 per ounce (2018 guidance range $950 - $1,025 per ounce)
FINANCIAL HIGHLIGHTS
. Fourth quarter net loss attributable to shareholders of $10.6 million ($0.10 loss per share) and
adjusted net profit attributable to shareholders(2) of $1.2 million ($0.01 per share) both declined
year-over-year largely as a result of lower gold production and lower gross profit, higher losses on
gold forward sales contracts, and a non-cash financing expense due to adoption of a new
accounting standard during the year. (The non-cash financing expense is excluded from adjusted
net profit attributable to shareholders(2).)
. Full-year net profit attributable to shareholders of $11.8 million ($0.11 per share) and adjusted net
profit attributable to shareholders(2) of $18.1 million ($0.17 per share) were both lower than the prior
year largely due to higher income taxes and a non-cash financing expense due to adoption of a
new accounting standard during the year that more than offset higher production and gross profit.
(The non-cash financing expense is excluded from adjusted net profit attributable to
shareholders(2).)
. FY2018 EBITDA(1) increased by 17% to $111.9 million, mainly due to higher gross profit and gains
on gold hedges
. FY2018 Operating cash flow increased by 29% to $92.1 million, mainly due to higher revenues and
lower income taxes paid
. Cash and cash equivalents declined to $46.6 million at December 31, 2018, as construction
activities continued to ramp up during the quarter at the Company’s second mine, Wahgnion


ORGANIC GROWTH
. Wahgnion: Development of Teranga’s second mine tracking well for completion
– Achieved major construction project milestones in 2018
– On track for first gold pour and ramp up to nameplate production in Q4 2019
– Increased open-pit mineral reserves by ~40% to 1.6 million ounces
– Increased mine life to 13 years and improved first five years’ production and cost profile
– Filed updated NI 43-101
. Golden Hill: The Company’s most advanced exploration project
– Announced early-stage initial resource estimate (effective November 30, 2018) comprised of 6.4 million tonnes at 2.02 g/t gold in the indicated category for 415,000 ounces and 11.95 million tonnes at 1.68 g/t of gold in the inferred category for 644,000 ounces of gold
– Initiated metallurgical test work to support future advanced engineering studies
– Increased ownership in Golden Hill to 100%
– Signed joint venture agreement on property immediately north of Golden Hill
. Côte d’Ivoire Exploration
– Commenced resource modelling, metallurgical test work and exploration work on Afema
– Advanced Miminvest properties including an initial drill program on the Guitry property
“At our flagship Sabodala operation, the mine continued to significantly outperform the reserve model in 2018, resulting in record production and costs well below the lower end of our guidance range for the year,” said Paul Chawrun, Chief Operating Officer. “With Wahgnion well on track, we are preparing a new mine plan for 2019 to mine more material than was planned for in the October 2018 technical report to accommodate the possibility of an earlier-than-planned commissioning and ramp up of the plant. And, at Golden Hill, we look forward to building upon the recently announced high grade initial resource.”
LOOKING AHEAD TO 2019
. First pour and ramp up at Wahgnion expected in Q4 2019
. With two operating gold mines, the Company’s production and cost guidance for 2019 is as follows:
Gold Production Cost of Sales/oz All-in Sustaining Costs/oz(1)*
Sabodala 215koz - 230koz $1,050 - $1,125 $825 - $900
Wahgnion 30koz - 40koz $1,175 - $1,250 $750 - $825
Consolidated 245koz - 270koz $1,050 - $1,125 $900 - $1,000
*All-in sustaining costs (excluding non-cash inventory movements and amortized advanced royalties). All-in sustaining costs for Sabodala includes sustaining capital expenditures but excludes growth capital related to the Sabodala village resettlement. Consolidated all-in sustaining costs adds corporate administration and share-based compensation expense to mine site figures.
. Growth capital spending guidance for 2019
– Wahgnion construction: $115 - $120 million
– Wahgnion pre-operating: ~ $30 million
– Sabodala village resettlement: $15 - $20 million
. Build on Golden Hill’s initial resource and complete an internal technical and economic assessment
. Continue to explore highly prospective properties in Côte d’Ivoire

see & read more on
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