Yamana Gold Reports First Quarter 2022 Results With Low Cost Performance Driving Strong Cash Flow Generation; Standout Quarters From Jacobina and Cerro Moro
APR 27, 2022
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TORONTO, April 27, 2022 (GLOBE NEWSWIRE) -- YAMANA GOLD INC. (TSX:YRI; NYSE:AUY; LSE:AUY) (“Yamana” or the "Company”) is herein reporting its financial and operational results for the first quarter of 2022. Production totalled 238,617 gold equivalent ounces ("GEO")(2) at total cost of sales, cash costs(1) and all-in sustaining costs ("AISC")(1) of $1,212, $734 and $1,084 per GEO(2) respectively. The standout production results, combined with the low cost performance, underpinned the strong cash flow generation including $151.7 million in cash flows from operating activities and $197.3 million in cash flows from operating activities before net change in working capital. The Company expects free cash flow to increase quarter-over-quarter with the strongest free cash flow generation anticipated in the second half of the year, and in particular during the fourth quarter, which is expected to result in cash balances steadily increasing throughout the year.

FIRST QUARTER HIGHLIGHTS

Financial Results - Strong Earnings and Cash Flow Generation

First quarter net earnings(3) of $57.8 million or $0.06 per share basic and diluted. Adjusted net earnings(1)(3) of $83.6 million or $0.09 per share basic and diluted.
Cash flows from operating activities of $151.7 million and cash flows from operating activities before net change in working capital increased 7.6% year-over-year to $197.3 million.
Net free cash flow(1) and free cash flow before dividends and debt repayments(1) of $111.8 million and $34.7 million, respectively.
Cash and cash equivalents totalled $516.4 million(6). The Company has $750.0 million in available credit.
Production Results - Standout Quarter from Jacobina and Cerro Moro

Production of 238,617 GEO(2) was in line with plan despite a lower gold to silver ratio. With the budget gold equivalent ratio, GEO(2) production would have exceeded plan. Quarterly GEO(2) production increased year-over-year from strong gold production and the exceptional performance from Cerro Moro which produced 44,801 GEO(2), an increase of 27% year-over-year.
Gold production of 210,533 ounces exceeded plan, following standout performances from Jacobina with 47,124 ounces, El Peñón with 41,330 ounces and Cerro Moro with 25,254 ounces. March was a standout month for Jacobina, with the mine achieving record monthly production and throughput.
Silver production of 2,198,669 ounces exceeded plan, following the exceptional performance from Cerro Moro.
Cost Results - Low Cost Quarter, Maintaining Solid Margins

First quarter total cost of sales, cash costs(1) and AISC(1) of $1,212, $734, and $1,084 per GEO(2) respectively. Total cost of sales and AISC(1) were lower than plan, despite the first quarter being the lowest planned production quarter of the year, and the lower than plan and guidance gold to silver ratio which also impacted GEO(2) production. The Company continues to monitor the impact of inflationary pressures on its cost structure and notes that in the first quarter, the price of certain consumables, primarily diesel and mill balls, increased while certain others have remained relatively constant. Furthermore, higher base metal prices have had a positive impact on by-product credits allocated to GEO(2) costs. The impact of inflation on costs remains uncertain mostly because it is unclear if the geopolitical events that have occurred since the Company provided its guidance earlier in the year, which have driven price increases on certain items, will continue, or whether the events will continue to impact the price of those items. Equally, in the first quarter, the Company successfully mitigated inflationary trends through productivity improvements and overall, as aforementioned, costs in the first quarter were lower than plan and in line with guidance. While the Company plans to increase capital spending in each of the following quarters, as compared to the first quarter, this will coincide with increases in production and generation of cash flows and free cash flows. Further, the Company notes that cash flows in the second half of the year will also increase as higher income tax installments will have been paid, as normal, in the first half of the year.
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