Algoma Steel Group Inc. press release
New Gold Reports Fourth Quarter And Full Year 2021 Results; Provides 2022 Operational Outlook And Updated Mineral Reserves And Mineral Resources
TSX - Toronto Stock Exchange · Canada
Canada NewsWire
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Achieves 2021 Updated Consolidated Guidance; Rainy River Mine Converts 569,000 Underground Gold Ounces to Mineral Reserves
(All amounts are in U.S. dollars unless otherwise indicated)
TORONTO , Feb. 23, 2022 /CNW/ - February 23, 2022 – New Gold Inc. ("New Gold" or the "Company") (TSX: NGD) (NYSE American: NGD) reports fourth quarter and full year 2021 results, updates Mineral Reserves and Mineral Resources for the Company as of December 31, 2021 , and provides its 2022 operational outlook. The Company will host a conference call and webcast today at 8:30 am Eastern Time to discuss these items (details are provided at the end of this news release). For detailed information, please refer to the Company's Management's Discussion and Analysis ("MD&A") and consolidated financial statements for the year ended December 31, 2021 that are available on the Company's website at www.newgold.com and on SEDAR at www.sedar.com . The Company uses certain non-GAAP financial performance measures throughout this news release. Please refer to the "Non-GAAP Financial Performance Measures" section of this news release and the MD&A for more information. Numbered note references throughout this news release are to endnotes which can be found at the end of this news release.
Consolidated Fourth Quarter and Full Year Highlights
Total production for the fourth quarter was 111,574 gold equivalent 1 ("gold eq.") ounces (81,072 ounces of gold, 214,030 ounces of silver and 14.2 million pounds of copper). For the year, production was 418,933 gold eq. 1 ounces (286,921 ounces of gold, 867,961 ounces of silver and 61.7 million pounds of copper). The Company achieved the updated consolidated gold equivalent guidance range. Operating expenses for the quarter were $912 per gold eq. ounce and $938 per gold eq. ounce for the year. Total cash costs 2 for the quarter were $965 per gold eq. ounce and $991 per gold eq. ounce for the year, achieving the updated annual guidance range of $960 to $1,030 per gold eq. ounce. All-in sustaining costs 2 for the quarter were $1,355 per gold eq. ounce and $1,463 per gold eq. ounce for the year, achieving the updated annual guidance range of $1,415 to $1,495 per gold eq. ounce. Average realized gold price 2 was $1,798 per ounce and average realized copper price 2 was $4.37 per pound for the quarter. For the year, average realized gold price 2 was $1,798 per ounce and average realized copper price 2 was $4.24 per pound. Cash generated from operations for the quarter was $106 million ( $0.16 per share) and $324 million ( $0.48 per share) for the year. Cash generated from operations for the quarter, before changes in non-cash operating working capital 2 , was $93 million ( $0.14 per share) and $323 million ( $0.47 per share) for the year. Net earnings for the quarter were $151 million ( $0.22 per share), and $141 million ( $0.21 per share) for the year. Adjusted net earnings 2 for the quarter were $25 million ( $0.04 per share) and $83 million ( $0.12 per share) for the year. During the quarter, the Company closed the previously announced sale of the Blackwater gold stream to Wheaton Precious Metals Corp. for $300 million ( _r _e fer to the Company's December 13, 2021 and December 22, 2021 press releases ). During the quarter, the Company amended its secured credit facility, extending the maturity date to December 2025 from October 2023 and increasing the maximum borrowing limit to $400 million from $350 million . 2021 year-end Mineral Reserves of 3.7 million ounces of gold; Rainy River underground conversion fully offsets 2021 gold ounce depletion. At the end of the quarter, the Company had a cash position of $482 million and a strong liquidity position of $857 million .
"While we had to navigate challenges throughout 2021, I am extremely proud of our resilient team and the way we ended the year," stated Renaud Adams , President & CEO. "The fourth quarter delivered our strongest production quarter of the year, allowing us to meet our updated guidance. It was also our lowest quarter from a cost perspective, leading to our highest free cash flow quarter of the year. Adding to that, we exited the year on a strong note with the sale of the Blackwater gold stream. The value we have been able to crystallize through multiple Blackwater-related transactions since August 2020 has positioned our Company with a peer-leading balance sheet and the financial strength to execute on our strategy."
"Looking to 2022, our strategy remains focused on operational excellence and optimization at both assets. At Rainy River , we converted meaningful underground Mineral Resources to Mineral Reserves resulting in a net increase to total gold reserves for New Gold. We continue to seek ways to further optimize the operation and reduce costs while we advance the development of the Intrepid underground zone, targeting initial production in the second half of the year. At New Afton, our priorities remain on advancing the B3 ramp-up and C-Zone development, exhausting the Lift 1 cave, including the recovery level zone, and completing commissioning of the in-pit tailings," added Mr. Adams.
Consolidated Financial Highlights
| | Q4 2021 | Q4 2020 | FY 2021 | FY 2020 | | Revenue ($M) | 202.6 | 198.9 | 745.5 | 643.4 | | Operating expenses ($M) | 99.6 | 97.3 | 377.3 | 339.9 | | Net earnings (loss), per share ($) | 0.22 | (0.03) | 0.21 | (0.12) | | Adj. net earnings, per share ($) 2 | 0.04 | 0.04 | 0.12 | 0.03 | | Operating cash flow, per share ($) | 0.16 | 0.15 | 0.48 | 0.44 | | Cash generated from operations, before changes in non-cash operating working capital, per share ($) 2 | 0.14 | 0.14 | 0.47 | 0.41 |
Revenues for the quarter were $203 million and $745 million for the year ended December 31, 2021 , an increase compared to the prior-year periods due to higher gold and copper prices, partially offset by lower sales volume. Operating expenses for the quarter and year ended December 31, 2021 , were higher than the prior-year periods due to the strengthening of the Canadian dollar relative to the U.S. dollar and the prior year benefitting from the wage subsidy. Net earnings for the quarter were $151 million ( $0.22 per share) compared to a net loss for the prior-year period of $21 million ( $0.03 per share). Net earnings for the year ended December 31, 2021 , were $141 million ( $0.21 per share) compared to a net loss for the prior year of $79 million ( $0.12 per share). The increase in net earnings compared to the prior-year periods were primarily due to higher revenue, the gain on the sale of the Blackwater gold stream to Wheaton Precious Metals Corp., and lower finance costs, partially offset by an increase in operating expenses and an unrealized loss on the revaluation of certain investments. Adjusted net earnings 2 for the quarter were $25 million ( $0.04 per share), a decrease compared to the prior-year period primarily due to higher adjusted tax expense 2 . Adjusted net earnings 2 for the year ended December 31, 2021 , were $83 million ( $0.12 per share), an increase compared to the prior year primarily due to higher revenue less cost of goods sold and lower finance costs.
Consolidated Operational Highlights
| | Q4 2021 | Q4 2020 | FY 2021 | FY 2020 | | Gold eq. production (ounces) 1 | 111,574 | 120,567 | 418,933 | 437,617 | | Gold eq. sold (ounces) 1 | 109,214 | 122,139 | 402,449 | 428,370 | | Gold production (ounces) | 81,072 | 83,096 | 286,921 | 293,139 | | Gold sold (ounces) | 78,745 | 86,491 | 277,451 | 291,877 | | Copper production (Mlbs) | 14.2 | 18.5 | 61.7 | 72.1 | | Copper sold (MIbs) | 14.2 | 17.5 | 58.4 | 68.0 | | Gold revenue, per ounce | 1,778 | 1,606 | 1,778 | 1,537 | | Copper revenue, per pound | 4.07 | 3.14 | 3.97 | 2.67 | | Average realized gold price, per ounce 2 | 1,798 | 1,623 | 1,798 | 1,559 | | Average realized copper price, per pound 2 | 4.37 | 3.34 | 4.24 | 2.86 | | Operating expenses, per gold eq. ounce | 912 | 799 | 938 | 794 | | Total cash costs, per gold eq. ounce 2 | 965 | 841 | 991 | 840 | | Depreciation and depletion, per gold eq. ounce | 469 | 419 | 489 | 454 | | All-in sustaining costs, per gold eq. ounce 2 | 1,355 | 1,491 | 1,463 | 1,389 | | Sustaining capital and sustaining leases ($M) 2 | 33.6 | 69.2 | 156.8 | 205.5 | | Growth capital ($M) 2 | 26.9 | 42.7 | 101.7 | 89.4 | | Total capital and leases ($M) | 60.5 | 111.9 | 258.5 | 294.9 |
Rainy River
Operational Highlights
| Rainy River Mine | Q4 2021 | Q4 2020 | FY 2021 | FY 2020 | | Gold eq. production (ounces) 1 | 70,500 | 68,241 | 242,961 | 233,201 | | Gold eq. sold (ounces) 1 | 68,380 | 72,279 | 237,061 | 235,416 | | Gold production (ounces) | 68,356 | 66,734 | 234,469 | 228,919 | | Gold sold (ounces) | 66,239 | 70,675 | 228,693 | 231,112 | | Gold revenue, per ounce | 1,796 | 1,624 | 1,797 | 1,561 | | Average realized gold price, per ounce 2 | 1,796 | 1,624 | 1,797 | 1,561 | | Operating expenses, per gold eq. ounce | 897 | 864 | 955 | 906 | | Total cash costs, per gold eq. ounce 2 | 897 | 864 | 955 | 906 | | Depreciation and depletion, per gold eq. ounce | 571 | 523 | 625 | 600 | | All-in sustaining costs, per gold eq. ounce 2 | 1,281 | 1,494 | 1,415 | 1,562 | | Sustaining capital and sustaining leases ($M) 2 | 24.0 | 43.6 | 100.9 | 147.5 | | Growth capital ($M) 2 | 2.3 | 2.8 | 11.6 | 3.1 | | Total capital and leases ($M) | 26.3 | 46.5 | 112.5 | 150.6 |
Operating Key Performance Indicators
| Rainy River Mine (Open Pit Mine only) | Q1 2021 | Q2 2021 | Q3 2021 | Q4 2021 | | Tonnes mined per day (ore and waste) | 150,767 | 158,556 | 149,630 | 129,775 | | Ore tonnes mined per day | 35,681 | 36,256 | 52,917 | 33,885 | | Operating waste tonnes per day | 65,643 | 71,124 | 88,216 | 62,348 | | Capitalized waste tonnes per day | 49,442 | 51,176 | 8,497 | 33,542 | | Total waste tonnes per day | 115,085 | 122,300 | 96,713 | 95,890 | | Strip ratio (waste:ore) | 3.23 | 3.37 | 1.83 | 2.83 | | Tonnes milled per calendar day | 26,301 | 25,349 | 25,245 | 24,492 | | Gold grade milled (g/t) | 0.80 | 0.82 | 0.89 | 1.03 | | Gold recovery (%) | 89 | 87 | 89 | 92 | | Mill availability (%) | 89 | 88 | 91 | 94 | | Gold production (ounces) | 54,656 | 52,901 | 58,557 | 68,356 | | Gold eq. production (ounces) 1 | 56,513 | 55,163 | 60,785 | 70,500 |
Fourth quarter gold eq. 1 production was 70,500 ounces (68,356 ounces of gold and 154,364 ounces of silver), an increase compared to the prior-year period due to higher gold grade and gold recovery, partially offset by lower tonnes processed. For the year ended December 31, 2021 , gold eq. 1 production was 242,961 ounces (guidance of 240,000 to 255,000 gold eq. 1 ounces) consisting of 234,469 ounces of gold (guidance of 235,000 to 250,000 ounces) and 611,433 ounces of silver. The increase over the prior year was due to higher tonnes processed, with the prior year including a two-week voluntary shutdown due to COVID-19. The Rainy River Mine achieved the low end of the updated gold equivalent guidance range. Operating expenses and total cash costs 2 were $897 per gold eq. ounce for the quarter, an increase over the prior-year period due to lower sales volumes and the strengthening of the Canadian dollar relative to the U.S. dollar. The strengthening of the Canadian dollar increased costs by $29 per gold eq. ounce in the quarter. For the year ended December 31, 2021 , operating expenses and total cash costs 2 were $955 per gold eq. ounce, achieving the updated annual guidance range of $925 to $985 per gold eq. ounce. The increase over the prior year was due to the strengthening of the Canadian dollar relative to the U.S. dollar, and the receipt of the wage subsidy in the prior year. All-in sustaining costs 2 were $1,281 per gold eq. ounce for the quarter, a decrease over the prior-year period primarily due to lower sustaining capital spend, partially offset by lower sales volumes. For the year ended December 31, 2021 , all-in sustaining costs 2 were $1,415 per gold eq. ounce, achieving the updated annual guidance range of $1,365 to $1,440 per gold eq. ounce. The decrease over the prior year was primarily due to higher sales volumes and lower sustaining capital spend. Total capital and leases for the quarter were $26 million , including $24 million related to sustaining capital and sustaining lease 2 payments, including $11 million of capitalized mining costs, and $2 million related to growth capital 2 . Sustaining capital spend during the quarter primarily included the advancement of the annual tailings dam raise. Growth capital during the quarter was related to the development of the Intrepid underground zone which advanced 298 metres. For the year ended December 31, 2021 , total capital and leases were $113 million , including $101 million related to sustaining capital and sustaining lease 2 payments, including $40 million of capitalized mining costs, and $12 million related to growth capital 2 . Free cash flow 2 for the quarter was $36 million , and for the year ended December 31, 2021 was $46 million (net of a $27 million stream payment). The increase over the prior-year periods was due to an increase in revenue from higher metal prices and lower capital spend. The open pit mine averaged 129,775 tonnes per day during the quarter, a decrease compared to the prior-year period primarily due to lower drill utilization. Approximately 3.1 million ore tonnes and 8.8 million waste tonnes (including 3.1 million capitalized waste tonnes) were mined from the open pit at an average strip ratio of 2.83:1. For the year, the average strip ratio was 2.7:1, in-line with the 2021 plan. The mill averaged 24,492 tonnes per day during the quarter, a decrease compared to the prior-year period primarily due to harder ore encountered from the 433 zone. The mill processed an average grade of 1.03 grams per tonne at a gold recovery of 92%. Mill availability for the quarter averaged 94%, despite a 3-day mill shutdown that was moved from early-2022 to December.
New Afton Mine
Operational Highlights
| New Afton Mine | Q4 2021 | Q4 2020 | FY 2021 | FY 2020 | | Gold eq. production (ounces) 1 | 41,074 | 52,326 | 175,972 | 204,416 | | Gold eq. sold (ounces) 1 | 40,835 | 49,860 | 165,387 | 192,953 | | Gold production (ounces) | 12,716 | 16,362 | 52,452 | 64,220 | | Gold sold (ounces) | 12,507 | 15,817 | 48,758 | 60,765 | | Copper production (Mlbs) | 14.2 | 18.5 | 61.7 | 72.1 | | Copper sold (Mlbs) | 14.2 | 17.5 | 58.4 | 68.0 | | Gold revenue, per ounce | 1,685 | 1,525 | 1,690 | 1,449 | | Copper revenue, per pound | 4.07 | 3.14 | 3.97 | 2.67 | | Average realized gold price, per ounce 2 | 1,807 | 1,621 | 1,804 | 1,553 | | Average realized copper price, per pound 2 | 4.37 | 3.34 | 4.24 | 2.86 | | Operating expenses, per gold eq. ounce | 938 | 706 | 912 | 657 | | Total cash costs, per gold eq. ounce 2 | 1,079 | 808 | 1,042 | 759 | | Depreciation and depletion, per gold eq. ounce | 297 | 260 | 288 | 268 | | All-in sustaining costs, per gold eq. ounce 2 | 1,330 | 1,330 | 1,385 | 1,064 | | Sustaining capital and sustaining leases ($M) 2 | 9.5 | 25.5 | 54.5 | 57.4 | | Growth capital ($M) 2 | 24.6 | 39.9 | 90.1 | 77.1 | | Total capital and leases ($M) | 34.1 | 65.4 | 144.6 | 134.5 |
Operating Key Performance Indicators
| New Afton Mine | Q1 2021 | Q2 2021 | Q3 2021 | Q4 2021 | | Tonnes mined per day (ore and waste) | 11,395 | 15,104 | 12,861 | 13,705 | | Tonnes milled per calendar day | 13,564 | 13,795 | 13,068 | 13,125 | | Gold grade milled (g/t) | 0.39 | 0.43 | 0.43 | 0.41 | | Gold recovery (%) | 79 | 80 | 83 | 81 | | Gold production (ounces) | 11,994 | 14,088 | 13,653 | 12,716 | | Copper grade milled (%) | 0.64 | 0.79 | 0.72 | 0.67 | | Copper recovery (%) | 80 | 83 | 82 | 80 | | Copper production (Mlbs) | 13.8 | 18.2 | 15.6 | 14.2 | | Mill availability (%) | 96 | 98 | 98 | 97 | | Gold eq. production (ounces) 1 | 39,512 | 50,542 | 44,843 | 41,074 |
Fourth quarter gold eq. 1 production was 41,074 ounces, consisting of 12,716 ounces of gold and 14.2 million pounds of copper. For the year ended December 31, 2021 , gold eq. 1 production was 175,972 ounces (guidance of 165,000 to 195,000 gold eq. 1 ounces), consisting of 52,452 ounces of gold (guidance of 52,000 to 62,000 ounces) and 61.7 million pounds of copper (guidance of 56 to 66 million pounds), achieving the gold equivalent guidance range for the year. The decrease over the prior-year periods was due to lower tonnes processed. Operating expenses and total cash costs 2 were $938 and $1,079 per gold eq. ounce for the quarter, an increase over the prior-year period primarily due to lower sales volumes, and the strengthening of the Canadian dollar relative to the U.S. dollar. The strengthening of the Canadian dollar increased costs by $31 per gold eq. ounce in the quarter. For the year ended December 31, 2021 , operating expenses and total cash costs 2 were $912 and $1,042 per gold eq. ounce, slightly above the annual total cash cost guidance range of $930 to $1,010 per gold eq. ounce. The increase over the prior year was due to lower sales volumes, the strengthening of the Canadian dollar relative to the U.S. dollar, and the receipt of the wage subsidy in the prior year. All-in sustaining costs 2 were $1,330 per gold eq. ounce for the quarter, in-line with the prior-year period. For the year ended December 31, 2021 , all-in sustaining costs 2 were $1,385 per gold eq. ounce, slightly above the annual guidance range of $1,225 to $1,325 per gold eq. ounce. The increase over the prior year was due to lower sales volumes and higher total cash costs, partially offset by lower sustaining capital spend. Total capital and leases for the quarter were $34 million , including $9 million related to sustaining capital and sustaining lease 2 payments and $25 million related to growth capital 2 . Sustaining capital spend during the quarter primarily related to B3 mine development and the advancement of the planned tailings dam raise. Growth capital during the quarter primarily related to C-Zone development and the thickened and amended tailings project. For the year ended December 31, 2021 , total capital and leases were $145 million , including $55 million related to sustaining capital and sustaining lease 2 payments and $90 million related to growth capital 2 . Free cash flow 2 for the quarter was $10 million , an increase over the prior-year period due to lower capital spend. For the year ended December 31, 2021 , free cash flow 2 was $16 million , an increase over the prior year due to an increase in revenue from higher metal prices. C-Zone development advanced by approximately 1,028 metres in the quarter. Mine infrastructure also advanced with the installation of conveyors and work initiated on a secondary crushing station. The project continues to advance on plan, with production expected to begin in the second half of 2023. The underground mine averaged 13,705 tonnes per day during the quarter as the mine prepares for the completion of Lift 1 mining activities and continues the progressive ramp-up of the B3 zone. The mill averaged 13,125 tonnes per day during the quarter, below the prior-year period, but in-line with mining rates. The mill processed gold grades of 0.41 grams per tonne and copper grades of 0.67%, with gold and copper recoveries of 81% and 80%, respectively.
2022 Operational Outlook
| Operational Estimates | Rainy River Mine | New Afton Mine | 2022 Consolidated Guidance | | Gold eq. production (ounces) 3 | 265,000 - 295,000 | 115,000 - 145,000 | 380,000 - 440,000 | | Gold production (ounces) | 260,000 - 290,000 | 35,000 - 45,000 | 295,000 - 335,000 | | Copper production (Mlbs) | - | 35 - 45 | 35 - 45 | | Operating expenses, per gold eq. ounce | $730 - $810 | $1,100 - $1,180 | $840 - $920 | | All-in sustaining costs, per gold eq. ounce 2 | $1,270 - $1,370 | $1,695 - $1,795 | $1,470 - $1,570 | | Capital Investment & Exploration Estimates | Rainy River Mine | New Afton Mine | 2022 Consolidated Guidance | | Sustaining capital and sustaining leases ($M) 2 | $125 - $155 | $55 - $70 | $180 - $225 | | Growth capital ($M) 2 | $15 - $25 | $100 - $130 | $115 - $155 | | Total capital and leases ($M) | $140 - $180 | $155 - $200 | $295 - $380 | | Exploration ($M) | $5 | $15 | $20 |