Centerra Gold Records Net Earnings of $80.7 million or $0.27 per Common Share,

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Overig advies 31/07/2020 13:42
- of $268.1 million; Increases Quarterly Dividend by 25%
All figures are in United States dollars and all production figures are on a 100% basis unless otherwise stated. This news release contains forward looking information regarding Centerra Gold’s business and operations. See “Caution Regarding Forward-Looking Information”.
Toronto, Canada, July 31, 2020: Centerra Gold Inc. (“Centerra” or the “Company”) (TSX: CG) today reported its second quarter 2020 results. Key events and operating results of the second quarter included:
? Net earnings of $80.7 million and adjusted net earningsNG of $97.8 million, $0.27 and $0.33 per common share (basic), respectively.
? Cash flow from operations was $268.1 million.
? Production totalled 219,692 ounces of gold and 19.1 million pounds of copper.
? Production costs per ounce of gold sold were $410 per ounce.
? Production costs per pound of copper sold were $1.20 per pound.
? All-in sustaining costs on a by-product basis per ounce soldNG were $804 per ounce.
? Cash position of $212 million at quarter end with total liquidity of $712 million. As at June 30, 2020, the Company’s $500 million corporate credit facility was undrawn.
? Commercial production achieved on May 31, 2020 at the Öksüt Mine which generated positive operating cash flow of $13.5 million and free cash flowNG
of $5.0 million during the quarter.
? Robust spring melt at Mount Milligan resulting in stored water inventory in excess of 6 million cubic metres at the end of the second quarter.
? An updated Kumtor 43-101 technical report is expected to be released in the fall of 2020.
? No change to 2020 production and cost guidance and a modification to growth capitalNG guidance.
? Quarterly Dividend increased by 25% to C$0.05 per common share.
All references in this document denoted with NG, indicate a non-GAAP term which is discussed under
“Non-GAAP Measures” and reconciled to the most directly comparable GAAP measure.

Scott Perry, President and Chief Executive Officer of Centerra stated, “We continue to stay vigilant at all of our operations to prevent an outbreak and avoid the spread of the COVID-19 virus and to ensure the health, safety and well-being of our employees, contractors and communities. At our Öksüt operation, we have celebrated a recent safety milestone, when on July 19, 2020, Öksüt achieved 3 million work hours without a lost time injury. Our continued commitment to Work Safe Home Safe is a driving force behind achieving such milestones.”
“The strong operating performance at Kumtor and Mount Milligan continued into this quarter and our Öksüt Mine achieved commercial production during the quarter. Our operations in the quarter delivered consolidated gold production of 219,692 ounces at all-in sustaining costsNG on a by-product basis of $804 per ounce sold in the quarter. Kumtor had another strong quarter producing 173,245 ounces of gold at allin sustaining costsNG on a by-product basis of $696 per ounce sold. Mount Milligan produced 35,656 ounces of gold and 19.1 million pounds of copper at all-in sustaining costsNG on a by-product basis of $679 per ounce sold and Öksüt produced 10,791 ounces of gold, 5,619 ounces were commercial production. During the quarter, Öksüt’s all-in sustaining costsNG on a by-product basis was $537 per ounce, being our lowest cost mine in the quarter.”
“Financially, the Company generated $268.1 million of cash from operations for the second quarter of 2020, which includes $220.4 million from Kumtor, $41.6 million from Mount Milligan and $13.5 million from Öksüt. During the second quarter of 2020, Kumtor, Mount Milligan and Öksüt delivered free cash flowNG of $156.9 million, $34.4 million and $5.0 million, respectively. Company-wide, free cash flow NG in the second quarter of 2020 was $169.1 million and we finished the quarter with cash of $212.2 million and no debt outstanding after repaying our corporate revolving credit facility in the quarter.”
“The decision of Centerra’s Board to increase the quarterly dividend by 25% to C$0.05 per common share announced today and planned into the future was based on our strong operating performance and the higher gold price environment, both of which contributed to our growing free cash flow and a debt-free balance sheet as at June 30, 2020.”

COVID-19 Update
Centerra continues to prioritize the health, safety and well-being of its employees, contractors, communities and other stakeholders during the current outbreak of COVID-19 and to take steps to minimize the effect of the pandemic on its business. Centerra has taken a series of measures to provide its employees with accurate information, help prevent infection and reduce the potential transmission of COVID-19, including activation of a global crisis management team, frequent communication with and compassionate support of all our people, travel restrictions, and the temporary closure of various administration offices including our head office in Toronto. Each Centerra site rapidly and successfully implemented proactive measures to minimize the impact of COVID-19 on operations, including strict protocols for access to operating sites, temperature checks and questioning upon entry, increased cleaning and hygiene protocols, modifications to work shifts and accommodation at site and an offsite quarantine facility established specifically for employees travelling to the Kumtor Mine site. In addition, our operating mine sites continue to assess the resiliency of their supply chain, are increasing mine site inventories of key materials and developing contingency plans to allow for continued operations.

The Company completed a company-wide COVID-19 employee survey in June to obtain feedback from employees on Centerra’s response to the pandemic and most importantly, on whether the Company is keeping employees well-informed and providing adequate support both physically and emotionally. The responses company-wide were favorable and Centerra will continue to address concerns and adapt its practices as necessary throughout the stages of this crisis.
While the majority of Centerra’s operating sites are currently operating without significant interruption, there has been an increase in the infection rates of COVID-19 and other illnesses in the Kyrgyz Republic which is beginning to have an impact on the available workforce for the Kumtor Mine. While Kumtor’s performance during the second quarter was unaffected, the Company is putting in place measures to manage the reduced workforce at Kumtor by mining waste below capacity while maintaining gold production levels by processing stockpiles as planned for the year. For further details on the impact of COVID-19 on Centerra’s operating sites and development projects please see “Operating Mines and Facilities” and “Pre- Development Projects”.
The Company notes that the effects of COVID-19 on its business continue to change rapidly. The measures enacted to date reflect the Company’s best assessment at this time but will remain flexible and be revised as necessary or advisable and/or as recommended by the public health and governmental authorities.

Exploration Update
Exploration activities in the second quarter of 2020 included drilling, surface sampling, geological mapping and geophysical surveying at the Company’s various projects (including earn-in properties); targeting gold and copper mineralization in Canada, Mexico, Turkey, Finland, USA and the Kyrgyz Republic. The Company has expanded its 2020 exploration program when compared to 2019 and is primarily focused on brownfield exploration at Kumtor, Mount Milligan and Öksüt. Exploration expenditures totalled $6.6 million in the second quarter of 2020, which included the impact of delays associated with COVID-19, compared to $6.3 million in the same quarter of 2019.

Kumtor Mine
The 2020 planned drilling program at Kumtor includes 55,000 metres of exploration and 15,000 metres of infill drilling, which are focused on priority primary and potential targets. Primary targets include various zones of the Central, Southwest and Sarytor deposits (areas) based on enhanced geological modelling from the recently updated Kumtor resource block model, and positive drilling results from 2018 and 2019. In addition, the 2020 planned drilling program at Kumtor includes the underexplored segments of the Kumtor Gold Trend – the Northeast targets, Bordoo, Akbel and conceptual targets (Hope Zone and others). An exploration potential update will be included in an updated Kumtor 43-101 technical report expected to be released in the fall of 2020.
In April, due to COVID-19 preventive measures, exploration drilling at Kumtor was temporarily suspended, resuming in June 2020. Due to the delay, a certain portion of the planned drilling program could be deferred to 2021.
During the second quarter of 2020, exploration drilling programs continued with the completion of fifteen diamond drill holes for 4,663 metres. Exploration drilling focused on testing zones of sulfide and oxide mineralization along the corridor between the Central and Southwest pits (Kosholuu, Hope and Southwest Oxide Deep zones), on the periphery of the Sarytor Pit, Northeast targets and Muzdusuu area.

Southwest Deposit (Area)
In the second quarter of 2020, a total of eleven diamond drill holes were completed in the Southwest area for a total of 2,902 metres.
Three drill holes have been completed between Southwest and Central pits in the Hope Zone for a total of 508 metres. Results from recent drilling have delineated a lens-shaped oxide gold mineralization. This mineralization extends along the hanging wall of the Kumtor Lower Thrust for more than 400 metres and is opened in both directions along the main NE strike.
Hole SW-20-319 intersected broad dispersed gold mineralization in Tertiary sediments.

Significant intersections are reported below:
see &

Dividend 5 ct.
Centerra Gold Increases Quarterly Dividend by 25% to C$0.05 per share
Toronto, Canada, July 31, 2020: Centerra Gold Inc. (“Centerra”) (TSX: CG) announced today that its Board of Directors has approved a quarterly dividend of C$0.05 per common share or C$14,725,699 (approximately US$11.0 million). The quarterly dividend is payable on August 28, 2020 to shareholders of record on August 14, 2020. The dividends are eligible dividends for Canadian income tax purposes.
Scott Perry, President and CEO stated, “The decision of Centerra’s Board to increase the quarterly dividend by 25% to C$0.05 per common share announced today, and planned into the future, was based on our strong operating performance and the higher gold price environment, both of which contributed to our growing free cash flow and a debt-free balance sheet as at June 30, 2020.”
Centerra continues to proactively monitor closely the evolving situation relating to COVID-19 and how it may affect the Company’s business. The Company notes that going forward, in addition to the other factors that the Board of Directors normally considers in connection with the declaration of dividends, it will also need to carefully consider whether, and the extent to which, developments relating to COVID-19 may affect its dividend program. In accordance with Centerra’s dividend policy, the timing and quantum of dividends are to be determined by the Board of Directors from time-to-time based on, among other things, the Company’s operating results, cash flow and financial conditions, Centerra’s current and anticipated capital requirements, and general business conditions.

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