TORONTO, Ontario, Canada, February 22, 2016 - Richmont Mines Inc. (TSX - NYSE MKT: RIC)
(“Richmont” or the “Corporation”) is reporting operating and financial results for the fourth quarter and yearended
December 31, 2015, driven by record results from the cornerstone Island Gold Mine. The Corporation will host a conference call and webcast on Monday, February 22, 2016, beginning at 8:30 a.m. Eastern Time (details below). (All amounts are in Canadian dollars, unless otherwise indicated.)
FOURTH QUARTER AND ANNUAL HIGHLIGHTS
Fourth quarter production of 22,380 ounces of gold (21,576 ounces sold) at an average realized gold price of $1,474 per ounce (US$1,104), for quarterly revenues of $31.9 million (US$23.9 million).
Annual production was 98,031 gold ounces (96,895 ounces sold), at an average realized gold price of $1,480 per ounce (US$1,157), for annual revenues of $143.7 million (US$112.4 million).
Production for 2015 exceeded the high end of revised guidance levels.
Cash costs for the fourth quarter were $1,034 per ounce (US$774 per ounce) and All-In-Sustaining
Costs (AISC) of $1,666 per ounce (US$1,274 per ounce). For 2015, Cash costs were $977 per ounce (US$764 per ounce) and AISC of $1,373 per ounce (US$1,074 per ounce). Cash costs and AISC for 2015 were in-line with revised guidance levels.
Fourth quarter loss was $4.1 million (US$3.0 million), or $(0.07) per share (US$0.05 per share). For 2015, earnings were $6.8 million (US$5.3 million), or $0.12 per share (US$0.09 per share).
For the fourth quarter, operating cash flow was $6.8 million (US$ 5.1 million), or $0.12 per share
(US$0.09 per share). For 2015, operating cash flow was $42.4 million (US$33.2 million), or $0.74 per share (US$0.58 per share).
Richmont ended the quarter with a strong cash balance of approximately $61.0 million that will support the Corporation’s growth strategy.
On February 9, 2016, Richmont announced a 187% increase in reserves, including a 206% increase in reserves at the cornerstone Island Gold Mine and a 95% increase in reserves at the Beaufor Mine.
Financial Highlights
(in thousands, except per share amounts)
Quarter ended Dec. 31, 2015 Quarter ended Dec. 31, 2014 Year-end Dec. 31, 2015 Year-end Dec. 31, 2014
Revenue from mining operations 31,864 29,562 143,733 132,196
Net earnings (loss) per share, basic (0.07) 0.02 0.12 0.18
Operating cash flow, per share 0.12 0.07 0.74 0.60
Adjusted operating cash flow,
per share(1) 0.04 0.10 0.60 0.76
Free cash flow, per share(2) (0.27) (0.07) (0.17) 0.09
(1) After changes in non-cash working capital.
(2) Refer to the Non-GAAP performance measures contained in the Annual Management’s Discussion & Analysis.
Operational Highlights
Quarter ended Dec. 31, 2015 Quarter ended Dec. 31, 2014 Year-end Dec. 31, 2015
Year-end Dec. 31, 2014
Gold produced (oz) 22,380 22,931 98,031 95,740
Gold sold (oz) 21,576 21,666 96,895 94,503
Cash costs per ounce (CAN$)(1) 1,034 981 977 956
AISC (CAN$)(1) 1,666 1,420 1,373 1,219
Realized gold price (CAN$) 1,474 1,361 1,480 1,396
Cash costs per ounce (US$)(1) 774 864 764 866
AISC (US$)(1) 1,247 1,251 1,074 1,104
Realized gold price (US$) 1,104 1,198 1,157 1,264
(1) Refer to the Non-GAAP performance measures contained in the Annual Management’s Discussion and Analysis.
“We successfully achieved our 2015 objectives of advancing the transformation of our cornerstone Island Gold Mine to best position this core asset for significant growth and cash flow generation beginning in 2017.
In 2015, we executed a very disciplined capital allocation strategy to unlock the potential of this core asset.
In 2016, we will focus on completing the accelerated development program as detailed in the Preliminary Economic Assessment (“PEA”),” stated Renaud Adams, CEO. He continued, “Our confidence in the potential of Island Gold continues to grow, strongly supported by the results of our recent PEA, our significant 206% increase in reserves, together with the early results from our exploration program that indicate a potential to expand this deposit both laterally and at depth, below the 1,000 metre level. We begin 2016 with two quality, Canadian-based assets, a strong cash position and a dedicated and experienced management team. We look forward to completing our accelerated development program at Island Gold and another year of creating significant value for our shareholders.”
Island Gold Mine Highlights
ISLAND GOLD MINE Quarter ended
Dec. 31, 2015 Quarter ended Dec. 31, 2014 Year-end Dec. 31, 2015 Year-end Dec. 31, 2014
Gold produced (oz) 14,203 8,974 55,040 42,206
Gold sold (oz) 13,504 9,052 52,363 42,078
Cash costs per ounce (CAN$)(1) 1,026 1,307 1,034 982
AISC (CAN$)(1) 1,587 2,062 1,460 1,317
Realized gold price (CAN$) 1,476 1,354 1,481 1,398
Cash costs per ounce (US$)(1) 768 1,151 808 889
AISC (US$)(1) 1,188 1,816 1,141 1,192
Realized gold price (US$) 1,105 1,192 1,158 1,266
Underground tpd 657 399 659 601
Mill tonnes 60,352 46,651 242,137 230,828
Mill tpd 656 507 663 632
Head grade (g/t) 7.62 6.28 7.31 5.91
Recoveries (%) 96.0 95.3 96.8 96.3
Sustaining Costs ($000’S) 7,576 6,837 22,330 14,110
Project Costs ($000’s) 14,505 1,956 30,894 11,767
Non-sustaining exploration
costs ($000’s) 2,865 443 4,600 771
(1) Refer to the Non-GAAP performance measures contained in the Annual Management’s Discussion and Analysis.
At the end of 2015, the Island Gold Mine reported 5 years of operations without lost-time injury.
Production for the fourth quarter was 14,203 ounces (13,504 ounces sold), in-line with the prior quarter, despite the 3-week planned shutdown to complete an underground mine upgrade and 2- week mill shutdown in the quarter. Production for the year was a record 55,040 ounces (52,363 ounces sold) for the year, 16% above annual production guidance levels.
Cash costs for the quarter were $1,026 (US$768) per ounce, a significant 21% decrease over the prior year period. For 2015, cash costs increased by 5% to $1,034 (US$808) per ounce. Cash costs for the year were in-line with guidance levels despite 50% of the tonnes mined coming from development ore as compared a plan of 40%.
AISC for the quarter decreased by 23% to $1,587 (US$1,188) per ounce over the prior year period.
For 2015, AISC increased by 11% to $1,460 (US$1,141) per ounce as the operation continued to focus on accelerated development as detailed in the PEA. AISC for 2015 were in-line with guidance estimates, in spite of higher than planned sustaining capital expenditures during the year.
During the fourth quarter, approximately $7.6 million (US$5.7 million) in sustaining costs were incurred at Island Gold and a total of approximately $22.3 million (US$17.4 million) for 2015, approximately $3.2 million (US$2.2 million) higher than guidance levels. Additional sustaining costs for the year included electrical and infrastructure upgrades of $1.7 (US$1.3 million) and the development of additional resources located in the Goudreau Zone, which was not considered in 2015 guidance estimates. As a result of certain sustaining capital costs being incurred in 2015, 2016 sustaining capital investment estimates have decreased to $17.3 million (US$12.7 million).
During the fourth quarter approximately $14.5 million (US$10.9 million) of project development costs were invested and $30.9 million (US$ 24.2 million) in 2015. Additional project capital investments for 2015 included the expansion of the tailings dam capacity for $6.8 million (US$ 5.3 million), electrical upgrades of $3.4 million (US$ 2.7 million) as well as other site infrastructure upgrades.
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The financial statements and related Management’s Discussion and Analysis can be found on the Corporation’s website at www.richmont-mines.com |
