VANCOUVER (miningweekly.com) – TSX- and NYSE American-listed Canadian gold producer New Gold has reported a headline profit of $32.5-million, or $0.06 a share, for the three months ended December 31, as record gold output boosted the bottom line.
This was a marked improvement on the miner's performance in the comparable quarter of 2016, when it recorded an adjusted loss of $4.9-million, or $0.01 a share. The most recent financial performance also beat average analyst estimates calling for earnings of $0.01 a share on revenue of $227.3-million.
The Toronto-based company, which operates five gold mines, reported a fourth-quarter net loss of $195.6-million, or $0.34 a share, compared with a loss of $22.3-million, or $0.04 a share, in the same period of 2016. New Gold booked an impairment charge for the Rainy River mine, in Ontario, and a loss from the sale of Peak Mines, in New South Wales, Australia, which was only partially offset by earnings from operations at Peak Mines.
New Gold reported record quarterly gold output of 154 530 oz – 61% higher year-on-year. All-in sustaining costs (AISC) were $771/oz for the quarter, up 25% year-on-year but in line with guidance.
Full-year gold output was 430 949 oz, boosted by a combination of Rainy River's start-up, strong performance from the Mesquite mine, in Arizona, and solid operating results at New Afton, in British Columbia, and Peak Mines. Rainy River achieved commercial production in mid-October, well ahead of plan and under budget. This enabled the company to hit its guidance range of 380 000 oz to 430 000 oz of gold in the 12-month period.
Copper output in the fourth quarter climbed 10% year-on-year to 28.1-million pounds, while copper output in 2017 was 104-million pounds, which was within guidance of 100-million to 110-million pounds of red metal.
For full-year 2017, the company reported a net loss of $108-million, or $0.19 a share, compared with a 2016 loss of $7-million, or $0.01 a share. Adjusted 2017 net earnings were $49.3-million, or $0.09 a share, compared with $14.6-million, or $0.03 a share, a year earlier.
"With production at the high end of guidance and costs below guidance, New Gold generated the highest annual cash flow in our company's history," said president and CEO Hannes Portmann.
The full-year AISC of $727/oz of gold was below the previously lowered guidance of $760/oz to $800/oz, New Gold stated.
The company said Rainy River's gold reserves increased by about 500 000 oz owing to a $25 increase in the gold price assumption for reserves and resources to $1 275/oz and $1 375/oz, respectively. It now holds year-end mineral reserves of 14.8-million ounces of gold, 900-million pounds of copper and 77-million ounces of silver, excluding Peak Mines, which was classified as a discontinued operation since the sale is expected to close in the current quarter.