Barrick Gold

TORONTO — Despite lower production levels, Barrick Gold Corp.’s first-quarter adjusted net earnings, operating cash flow and free cash flow all increased compared to the prior-year period, primarily driven by higher gold prices.

The company announced April 23 that gold production and costs for the quarter ending March 31 were in line with expectations, with higher production and lower costs expected in the second half of 2018 driven by the timing of capital expenditures, higher throughput and improved grades.

The company’s priorities for 2018 are focused on positioning Barrick to grow free cash flow per share over the long term from a portfolio of high-quality, long-life gold assets in the Americas, with an increasing focus on organic growth in Nevada and the Dominican Republic.

At existing operations, the company stated its goal is to maintain industry-leading margins through a continuous cycle of optimization, pushing mines to achieve greater levels of safety, efficiency and productivity, while working to mitigate increasing costs associated with more complex ore types and a shift to more underground mining.

In addition, Barrick is making investments in digital technology and innovation to identify and accelerate further operational improvements across its portfolio.

Barrick reported first quarter net earnings attributable to equity holders of $158 million ($0.14 per share) and adjusted net earnings of $170 million ($0.15 per share).

The company reported first quarter revenues of $1.79 billion, net cash provided by operating activities of $507 million, and free cash flow of $181 million.

Gold production in the first quarter was 1.05 million ounces, at a cost of sales applicable to gold of $878 per ounce, all-in sustaining costs of $804 per ounce and cash costs of $573 per ounce.

Copper production was 85 million pounds, at a cost of sales applicable to copper of $2.07 per pound, all-in sustaining costs of $2.61 per pound, and C1 cash costs of $1.88 per pound.

The company expects full-year gold production of 4.5-5.0 million ounces, at a cost of sales of $810-$850 per ounce, all-in sustaining costs of $765-$815 per ounce, and cash costs of $540-$575 per ounce.

Full-year copper production guidance remains at 385-450 million pounds, at a cost of sales of $1.80-$2.10 per pound, all-in sustaining costs of $2.30-$2.60 per pound, and C1 cash costs of $1.55-$1.75 per pound.

During the first quarter, S&P Global Ratings and Moody’s Investors Service upgraded Barrick’s credit rating, citing significant improvements in free cash flow generation and liquidity, supported by the company’s low-cost portfolio and favorable geopolitical risk profile.

The company does not intend to sell additional assets for purposes of debt reduction, and will use cash on hand and cash flow from operations for future debt repayments. Proceeds from any future portfolio optimization will be used to enhance the project pipeline, or returned to shareholders.

Nevada growth projects remain on schedule and within budget. The Fourmile exploration program in the Cortez district is progressing, with encouraging initial assay results.

Coeur Mining

CHICAGO — Coeur Mining Inc. reported first quarter 2018 financial results April 25 as well as an overview of key operating and strategic achievements during the period.

Financial results for the first quarter included revenue of $163.3 million and net income of $0.7 million. First quarter cash flow from operating activities was $15.5 million, adjusted EBITDA was $49.5 million, and free cash flow was a loss of $26.8 million.

The results reflect strong production and cost performance at the company’s Palmarejo silver-gold mine in northern Mexico, including a second consecutive quarter of costs applicable to sales per average spot silver equivalent ounce below $7.

Performance was also impacted by a normalization of production levels at the Rochester mine in Nevada, which benefited from a temporary boost to production during the prior quarter due to accelerated recoveries from the newly expanded Stage IV leach pad and from the placement of higher-grade gold ore during the second half of 2017; planned lower grades during the quarter at the Wharf and Kensington mines; and a $17.9 million increase in working capital compared to year-end 2017.

Free cash flow during the quarter was additionally affected by capital expenditures of $18.6 million related to the commissioning of operations at the company’s new Silvertip underground mine in British Columbia.

Coeur achieved several important milestones during the first quarter, which included commencing production slightly ahead of schedule at the Silvertip mine and announcing the results of a re-scoped mine plan and preliminary economic assessment for its Rochester mine in Nevada. The PEA reflects plans to add high-pressure grinding roll technology to Rochester’s crushing circuit, potentially improving silver recovery curves and doubling the mine’s expected net asset value to $609 million. The introduction of HPGR technology has the potential to increase Rochester’s silver recoveries from 61 percent over 20 years to 70 percent in just over two years, which could significantly improve the mine’s economics. The PEA also specifies that the technology would reduce cost per gold equivalent ounce for the first 10 years after installation, increase life-of-mine cash flows and improved margins by 122 percent and extend mine life to 2038.

Comstock Mining

VIRGINA CITY — The advancement of a joint venture on the Virginia City historic Lucerne Mine and the reduction of debt highlighted the first-quarter results announced by Comstock Mining Inc. The company reported selected unaudited financial results for the fiscal quarter.

Select financial results show that the company experienced a net loss of $2.5 million or ($0.05) loss per share for the first quarter of 2018, as compared to net loss of $2.8 million, or ($0.07) loss per share for the same period last year. The improvement resulted from net cost reduction efforts.

Comstock’s real estate, exploration, mine development, environmental and reclamation expenses achieved record lows, while general and administrative expenses stayed relatively flat.

The company’s net cash used in operations during the first quarter totaled $1.1 million, with another $1 million net cash in financing. Comstock’s total cash and cash equivalents in the first quarter equaled $2 million.

In operations, Comstock advanced an option agreement with Tonogold, announced in October 2017, regarding the Lucerne Mine. Tonogold invested approximately $1 million for the evaluation and assessment of the Lucerne Mine Project’s resource and preliminary economic feasibilities.

Kinross Gold

TORONTO — Kinross Gold Corp. reported a strong operational start to 2018, with solid production from mines and lower costs, the company announced in first-quarter results May 8.

Kinross produced 653,937 attributable gold equivalent ounces in the first quarter of 2018, compared with 671,956 gold equivalent ounces in the first quarter of 2017.

Revenue from metal sales increased 13 percent to $897.2 million in the first quarter of 2018, compared with $796.1 million during the same period in 2017, due to an increase in gold equivalent ounces sold and a higher realized gold price.

Adjusted operating cash flow increased by 45 percent to $363.7 million for the first quarter of 2018. Net operating cash flow was $293.5 million.

Adjusted net earnings increased to $125.2 million, or $0.10 per share, for Q1 2018, compared with adjusted net earnings of $23.4 million, or $0.02 per share, for Q1 2017. The increase was mainly due to higher margins and a decrease in depreciation, depletion and amortization.

Reported net earnings were $106.1 million, or $0.09 per share, for Q1 2018, compared with earnings of $134.6 million, or $0.11 per share, in Q1 2017.

Capital expenditures increased to $246.9 million for Q1 2018, compared with $178.9 million for the same period last year.

Construction of the Round Mountain Phase W project is progressing according to schedule, with engineering 90 percent complete and initial low-grade ore expected in mid-2019. Pre-grading of the heap leach pad has commenced, along with earthworks in the new infrastructure area. The commissioning of two new electric rope shovels has been completed and stripping is progressing on schedule.

At the Bald Mountain Vantage Complex, engineering is now 90 percent complete with commissioning of the heap leach pad and processing facilities expected to commence in Q1 2019. The majority of procurement packages and construction contracts have been awarded and all major permits have now been received.

Klondex Mines

VANCOUVER — Klondex Mines Ltd. sustained a net loss of $8 million in the first quarter of 2018, according to the company’s operational and financial results released on May 3.

Net loss for the first quarter of 2018 was $8 million or $0.04 per share. The first quarter of 2018 included $3.6 million for costs related to the pending acquisition of Klondex by Hecla Mining Co. Excluding the net impact of these costs, the company’s adjusted net loss for the quarter was $5.1 million or $0.02 per share.

The company announced in March that Hecla will acquire all of the outstanding shares of Klondex through a plan of arrangement. Hecla will acquire Klondex for consideration of $462 million comprised of cash and shares of Hecla common stock.

The closing of the transaction is subject to certain conditions including shareholder and regulatory approvals. Pending receipt of all required approvals, the company anticipates that the transaction will be completed around the end of the second quarter of 2018.

Klondex mined a total of 49,873 gold equivalent ounces, with production of 43,525 GEOs. In Nevada, total GOEs mined were 47,499, with production of 41,415 GEOs. At the True North mine in Canada, the company mined and produced 2,374 and 2,111 GEOs respectively from underground operations. Klondex sold 42,541 GEOs, consisting of 40,572 gold ounces and 158,239 silver ounces.

Revenue was $56.8 million from average realized selling prices per gold and silver ounce of $1,334 and $16.61, respectively.

First quarter 2018 revenues increased compared to the first quarter of 2017 due to more ounces sold and a higher price per ounce of gold. Increases in production costs during the first quarter of 2018, as compared to the same period in 2017, were driven by the operations at Hollister and Aurora, which were not operating during first quarter 2017.

Cash balance at the end of the first quarter of 2018 was $27.8 million after $8 million of operating cash inflows, $3.3 million used in investing activities, and $0.5 million used in financing activities. As of March 31, the company had total liquidity of $43.8 million, consisting of $38.8 million in working capital and $5 million revolver borrowing availability. The company held metal inventory valued at approximately $28.8 million at the end of the first quarter.

McEwen Mining

TORONTO — McEwen Mining Inc. reported an industrious start to the year, especially in gold production, development and exploration, in its first quarter 2018 results released May 1.

The first quarter of 2018 “marked the beginning of an important year for McEwen Mining,” said Robert McEwen, executive chairman and chief owner, in an investor conference call.

The company achieved production of 44,344 gold equivalent ounces in the first quarter of 2018.

Net cash flow from the business, excluding project development costs, was $12.4 million, offset by $22.7 million related to investments toward long-term production growth at Gold Bar in Nevada, Black Fox project in Canada and Los Azules project in Argentina.

Consolidated net loss was $5.2 million, or $0.02 per share. In the first quarter, McEwen paid a semi-annual return of capital distribution of $0.005 per share of common stock, for a total distribution of $1.7 million.

As of April 30, the company had cash, investments and precious metals of $47 million — and no debt.

During Q1 2018, construction activities at Gold Bar focused on finishing civil works related to the heap leach pad, ponds and site infrastructure, in preparation for major equipment and material deliveries in the second quarter.

Cumulative to date, McEwen capitalized $14.8 million to construction in progress relating to permitting, engineering, and site development activities. The company expects to spend about $25 million per quarter in the second and third quarters. McEwen said the company might consider taking on some debt to finance Gold Bar.

Construction is advancing on schedule for completion by the end of 2018, and McEwen expects to declare commercial production in early 2019. During the first three years of operation, Gold Bar is projected to produce approximately 55,000, 74,000 and 68,000 ounces of gold respectively.

Newmont Mining

DENVER — Newmont Mining Corp. declared a dividend of 14 cents per share and a strong portfolio in first quarter 2018 results released April 26.

“Newmont delivered solid operating and financial results in the first quarter,” said Gary J. Goldberg, president and CEO in a statement. “Costs and production remained in line with guidance, and our next generation of profitable mines … advanced on schedule to the next stage of development study. We also generated $644 million in adjusted [earnings before interest, taxes, depreciation and amortization] and declared a dividend of $0.14 per share, nearly three times higher than prior year quarter.”

The company generated $644 million in EBITDA, representing a 12 percent increase compared to the same quarter in the previous year. The per share dividend is the strongest among senior gold producers, Newmont stated. Free cash flow totaled $35 million, and cash on hand amounted to $3.1 billion.

Net income from continuing operations attributable to stockholders was $170 million, or $0.32 per diluted share, delivered adjusted net income of $185 million or $0.35 per diluted share, up 35 percent compared to the prior year quarter.

The company — with about 70 percent of its projects in the U.S. and Australia — strengthened its portfolio in the first quarter, Goldberg explained in an investor conference call.

In North America, Newmont is on track to bring Northwest Exodus and Twin Creeks into commercial production this year, and has ushered Long Canyon Phase 2 into the next stage of a development study while underground development is ongoing. In the first quarter, Newmont began shipping concentrates from the Cripple Creek & Victor mine in Colorado for processing in Nevada, and the process is yielding higher-than-expected recoveries.

Revenue for Newmont increased by about 8 percent over the first quarter, to $1.8 billion, realized by higher gold prices, said Newmont Executive Vice President and Chief Financial Officer Nancy Buese on the conference call, despite lower production.

Newmont produced 1.21 million ounces of gold in the first quarter, a decrease of 2 percent from the previous quarter. Lower production was because of lower leach activity, lower grade, maintenance and reduced recovery at CC&V while the company prepared concentrate for shipment to Nevada.

Adjusted net income was $185 million or $0.35 per diluted share, compared to $136 million or $0.26 per diluted share in the prior year quarter; favorable pricing was partially offset by lower production and higher CAS. The adjustments to net income of $0.03 related to restructuring, valuation allowances and other tax adjustments.

The company also continued to invest in projects and exploration “to improve mine life and build a stronger reserve base,” Buese said, adding that another focus is to return cash to shareholders. Newmont is on track to return $350 million to shareholders in 2018, she said.

Goldberg wrapped up the conference call by saying Newmont’s stable assets and pipeline of projects give the company an advantage in the industry. Going forward, the company aims for steady and profitable production over a longer horizon, investment in exploration, and to create value for investors.

Premier Gold Mines

THUNDER BAY — Explorer-turned-producer Premier Gold Mines Ltd. reported growth efforts — with a strong focus on Nevada — in the first quarter of 2018 in its operating and financial results released May 8.

The company became a producer in late 2016 and has a pipeline of precious metal projects in mining jurisdictions in Canada, Mexico and the United States.

Premier leaders expect to have three advanced exploration or mine projects under development by the end of the year.

At the South Arturo property near Carlin, Premier plans to commence construction of the Phase 1 open pit and El Nino underground from the bottom of the Phase 2 pit in the second half of 2018. The company partners with Barrick Gold Corp. to process South Arturo’s stockpiled ore at the Barrick Nevada Goldstrike mine, and in Q1, 15,541 ounces of gold delivered to Premier exceeded guidance for the year.

Overall, Premier’s Q1 production was down compared to the same period last year. From South Arturo and the Mercedes mine in Mexico, the company produced a total of 30,550 ounces of gold and 59,826 ounces of silver during Q1 2018 compared to 50,979 ounces of gold and 98,382 ounces of silver during Q1 2017.

The decrease was due to the completion of mining the Phase 2 pit at South Arturo in 2017 and Mercedes’ production profile being more heavily weighted for the second quarter, said Stephen McGibbon with Premier Gold on the conference call.

At McCoy-Cove south of Battle Mountain, Premier maintains a 100 percent interest in the Cove Property and plans to invest heavily in exploration and development.

In January, Premier signed an agreement that provides Barrick with an option to earn up to a 60 percent interest in the McCoy-Cove Property that surrounds the main deposit area. Exploration on the joint venture property began in April and will include detailed geophysics, surface mapping and soil sampling prior to drill testing several prospective targets.

A preliminary economic assessment is expected to be released in mid-May, in conjunction with the company’s Investor Day on May 15. Preliminary engineering, and dewatering and baseline studies have been initiated to advance an underground exploration program planned in the second half of 2018.

Premier reported revenue of $39.2 million, operating income of $9.6 million and a net loss of $2 million, or 1 cent per share. Total capital spending was $5.3 million. The company has a cash balance of $98.4 million.

SSR Mining

VANCOUVER — Production is primed to ramp up at the Marigold Mine near Valmy, SSR Mining Inc. reported in its financial and operation results released May 10.

“We produced over 78,000 gold equivalent ounces with all three operations performing well during the quarter,” said Paul Benson, SSR Mining president and CEO, adding that the company’s operating and financial performance “positions us well for growth in 2018 and 2019.”

At Marigold, the company produced 42,960 ounces of gold at cash costs of $720 per payable ounce of gold sold, and stacked a near-record 7.1 million tons of ore.

Production was within guidance but down 19 percent from the previous quarter because of lower ore stacked in the fourth quarter; however, Marigold mined 16.2 million tons of material, 16 percent more than the previous quarter, reflecting an increase in operating days for the quarter due to a resumption of normal mining activities, SSR Mining stated in a press release.

The company’s 17 percent overall revenue decrease for the quarter was because of anticipated declines in sales from its Argentina operation while processing lower grade stockpiles, and due to planned production and leach cycles at Marigold.

Despite lower cash generated from operating activities in the first quarter, SSR Mining added to its cash balance sheet with the sale of common shares of Pretium Resources Inc. and funds from a joint venture. Cash and cash equivalents increased to $472.9 million during the quarter, creating a “rock solid” balance sheet, Benson said on a conference call covering first-quarter results.

Quarterly material movement is expected to increase this year as four additional haul trucks join the Marigold fleet. Approximately 7.1 million tons of ore, a near record, were delivered to the heap leach pads, according to results.

Cash costs at Marigold were 3 percent higher than the previous quarter at $720 per payable ounce of gold sold in the first quarter. The increase is attributed to the cost per ounce of leach pad inventory going up, continued lower gold grades and a reduction in deferred stripping, SSR Mining reported.

Total mining costs of $1.80 per ton in the first quarter of 2018 were 9 percent lower than in the previous quarter due to more tons mined. Processing and general administrative costs were 14 percent and 18 percent lower.

A total of 42,078 ounces of gold were sold at an average realized price of $1,331 per ounce during the first quarter of 2018, a decrease of 18 percent from the 51,420 ounces of gold sold at average realized price of $1,269 per ounce during the fourth quarter of 2017, the company reported.

Also at Marigold, SSR Mining is focusing 2018 exploration on infill drilling of the Red Dot resource area and exploring the Mackay Phase 5 pit, where the first series of drill holes targeted higher grade structures.

A technical report to be filed by the third quarter will include the 2017 mineral reserves contained in the life-of-mine pit design and reflect added hauling capacity for expected annual gold production of more than 250,000 ounces in 2022.

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