Alamos Gold Reports First Quarter 2025 Results

2025-04-30

TSX - Toronto Stock Exchange · Gold · Canada

All amounts are in United States dollars, unless otherwise stated.

TORONTO, April 30, 2025 (GLOBE NEWSWIRE) -- Alamos Gold Inc. (TSX:AGI; NYSE:AGI) (“Alamos” or the “Company”) today reported its financial results for the quarter ended March 31, 2025.

“We produced 125,000 ounces in the first quarter, meeting the low end of quarterly guidance with a solid performance from Island Gold offset by a slower ramp up of the Magino mill, as well as lower production from Young-Davidson. Both operations have demonstrated a significant improvement in April and we expect this to contribute to stronger production and lower costs in the second quarter. With a further increase in production and decrease in costs expected in the second half of the year, we remain on track to achieve our full year production guidance,” said John A. McCluskey, President and Chief Executive Officer.

“We expect this improvement to continue over the next several years through our portfolio of high-return, low-cost growth projects. The Phase 3+ Expansion continues to track well for completion in 2026, and with construction activities ramping up on Lynn Lake and PDA this year, we expect steady growth over the next several years towards a run rate of 900,000 ounces per year. Longer-term, we see excellent potential to grow production to one million ounces per year through a further expansion of the Island Gold District. Nearly all of this growth is in Canada, it’s all lower cost, and it’s all fully funded providing one of the strongest outlooks in our sector,” Mr. McCluskey added.

First Quarter 2025 Operational and Financial Highlights

Produced 125,000 ounces of gold, consistent with the low end of the range of quarterly guidance with a solid quarter at Island Gold offsetting lower production from Young-Davidson and Magino. With stronger production expected in the second quarter and through the remainder of the year, the Company remains on track to achieve full year production guidance Sold 117,583 ounces of gold at an average realized price of $2,802 per ounce, generating quarterly revenues of $333 million. Ounces sold were 6% lower than production in the quarter due to timing, with the sale of these ounces to benefit future quarters. The average realized gold price was below the London PM Fix price, reflecting the delivery of 12,346 ounces into the gold prepayment facility executed in July 2024 based on the prepaid price of $2,524 per ounce Total cash costs 1 of $1,193 per ounce and all-in sustaining costs ("AISC" 1 ) of $1,805 per ounce were above the top end of guidance for the first half of 2025, driven by higher share-based compensation costs and higher costs per ounce at Young-Davidson and Magino. Given the 45% increase in the share price during the quarter, the revaluation of previously issued share-based compensation increased AISC by approximately $230 per ounce compared to guidance Total cash costs and AISC are expected to decrease significantly into the second quarter and through the second half of the year Cost of sales were $195.2 million or $1,660 per ounce Cash flow from operating activities totaled $79.6 million (including $131.4 million before changes in working capital and taxes paid 1 , or $0.31 per share). Free cash flow was negative $20.1 million and was impacted by $52.8 million of cash taxes primarily related to 2024 year-end mining and income taxes, settlement of 25% of the gold prepayment obligation, and annual share-based compensation payments. The Company expects stronger free cash flow through the remainder of the year reflecting higher production, lower costs, and lower cash tax payments Adjusted net earnings 1 were $59.8 million, or $0.14 per share. Adjusted net earnings includes adjustments for unrealized losses on commodity hedge derivatives, net of tax, of $46.3 million, adjustments for unrealized foreign exchange gains recorded within deferred taxes and foreign exchange gain totaling $2.5 million, and other adjustments of $0.8 million Cash and cash equivalents were $289.5 million at March 31, 2025, down from $327.2 million at the end of 2024 due to timing of gold sales and the 2024 year-end cash tax payment, paid in the first quarter. The Company remains in a net cash position with $250 million drawn on its credit facility (the "Facility"), and is well-positioned to internally fund all its growth initiatives with strong ongoing free cash flow and $789.5 million of total liquidity Paid dividends of $10.4 million, or $0.025 per share for the quarter Announced a construction decision on the Lynn Lake project in January 2025 with initial production expected during the first half of 2028. With average annual production of 176,000 ounces over its first ten years at first quartile mine-site AISC, Lynn Lake is expected to increase consolidated production to approximately 900,000 ounces per year, and drive a further decrease in costs Entered into an Impact Benefit Agreement ("IBA") with Mathias Colomb Cree Nation ("MCCN"). Concurrently, MCCN's application for judicial review of the positive Decision Statement issued by the Minister of Environment and Climate Change Canada in respect of the Lynn Lake Project and its corresponding internal appeal of the Environment Act Licenses issued by the Province of Manitoba were both withdrawn by MCCN. The Company now has IBA's in place with both of the First Nation communities proximate to the Lynn Lake Project Received approval of an amendment to the existing environmental impact assessment (Manifestación de Impacto Ambiental “MIA") by Mexico’s Secretariat of Environment and Natural Resources (“SEMARNAT”) in January 2025, allowing for the start of construction on the PDA project within the Mulatos District Reported year-end 2024 Mineral Reserves of 14.0 million ounces of gold (298 million tonnes ("mt")) grading 1.45 grams per tonne of gold (“g/t Au”), a 31% increase from 2023 reflecting the acquisition of Magino in 2024, continued high-grade additions at Island Gold, and an initial Mineral Reserve at Burnt Timber and Linkwood. This marked the sixth consecutive year Mineral Reserves have grown for a cumulative increase of 44%. Additionally, Measured and Indicated Mineral Resources increased 50% to 6.6 million ounces, while Inferred Mineral Resources decreased 2% to 7.1 million ounces Announced a binding agreement to sell the option to earn 100% interest in the non-core Quartz Mountain Gold Project (“Quartz Mountain”), located in Oregon, to Q-Gold Resources Ltd. (TSXV:QGR) (“Q-Gold”) for total consideration of up to $21 million and a 9.9% equity interest in Q-Gold in April 2025. The transaction is expected to close in the second quarter of 2025

(1) Refer to the “Non-GAAP Measures and Additional GAAP Measures” disclosure at the end of this press release and associated MD&A for a description and calculation of these measures.

Highlight Summary

| | Three Months Ended March 31, | | | | 2025 | 2024 | | Financial Results (in millions) | | | | Operating revenues | $333.0 | $277.6 | | Cost of sales (1) | $195.2 | $173.6 | | Earnings from operations | $94.7 | $81.4 | | Earnings before income taxes | $25.7 | $75.6 | | Net earnings | $15.2 | $42.1 | | Adjusted net earnings (2) | $59.8 | $51.2 | | Adjusted earnings before interest, taxes, depreciation and amortization (2) | $145.4 | $127.2 | | Cash provided by operating activities before changes in working capital and taxes paid (2) | $131.4 | $135.4 | | Cash provided by operating activities | $79.6 | $109.4 | | Capital expenditures (sustaining) (2) | $26.8 | $26.5 | | Sustaining finance leases (3) | $4.3 | $— | | Capital expenditures (growth) (2) | $66.3 | $51.6 | | Capital expenditures (capitalized exploration) | $6.6 | $6.4 | | Free cash flow (2) (3) | ($20.1) | $24.9 | | Operating Results | | | | Gold production (ounces) | 125,000 | 135,700 | | Gold sales (ounces) | 117,583 | 132,849 | | Per Ounce Data | | | | Average realized gold price (5) | $2,802 | $2,069 | | Average spot gold price (London PM Fix) | $2,859 | $2,070 | | Cost of sales per ounce of gold sold (includes amortization) (1) | $1,660 | $1,307 | | Total cash costs per ounce of gold sold (2) | $1,193 | $910 | | All-in sustaining costs per ounce of gold sold (2) | $1,805 | $1,265 | | Share Data | | | | Earnings per share, basic | $0.04 | $0.11 | | Earnings per share, diluted | $0.04 | $0.11 | | Adjusted earnings per share, basic (2) | $0.14 | $0.13 | | Weighted average common shares outstanding (basic) (000’s) | 420,415 | 396,817 | | Financial Position (in millions) | | | | Cash and cash equivalents (4) | $289.5 | $327.2 |

| | Three Months Ended March 31, | | | | 2025 | 2024 | | Gold production (ounces) | | | | Island Gold District (7) | 59,200 | 33,400 | | Young-Davidson | 35,400 | 40,100 | | Mulatos District (8) | 30,400 | 62,200 | | Gold sales (ounces) | | | | Island Gold District (7) | 53,388 | 34,130 | | Young-Davidson | 35,475 | 39,810 | | Mulatos District (8) | 28,720 | 58,909 | | Cost of sales (in millions) (1) | | | | Island Gold District (7) | $79.5 | $33.4 | | Young-Davidson | $65.1 | $65.4 | | Mulatos District (8) | $50.6 | $74.8 | | Cost of sales per ounce of gold sold (includes amortization) (1) | | | | Island Gold District (7) | $1,489 | $979 | | Young-Davidson | $1,835 | $1,643 | | Mulatos District (8) | $1,762 | $1,270 | | Total cash costs per ounce of gold sold (2) | | | | Island Gold District (7) | $1,068 | $706 | | Young-Davidson | $1,350 | $1,188 | | Mulatos District (8) | $1,233 | $840 | | Mine-site all-in sustaining costs per ounce of gold sold (2)(3) | | | | Island Gold District (7) | $1,446 | $1,105 | | Young-Davidson | $1,655 | $1,482 | | Mulatos District (8) | $1,320 | $905 | | Capital expenditures (sustaining, growth, and capitalized exploration) (in millions) (2) | | | | Island Gold District (4)(7)(9) | $72.3 | $54.6 | | Young-Davidson (5) | $18.8 | $20.2 | | Mulatos District (6)(8) | $4.0 | $3.9 | | Other | $8.9 | $5.8 |

(1) Cost of sales includes mining and processing costs, royalties, and amortization expense. (2) Refer to the “Non-GAAP Measures and Additional GAAP Measures” disclosure at the end of this press release and associated MD&A for a description and calculation of these measures. (3) For the purposes of calculating mine-site all-in sustaining costs, the Company does not include an allocation of corporate and administrative expense and corporate share-based compensation expense. (4) Includes capitalized exploration at Island Gold District of $3.9 million for the three months ended March 31, 2025 ($3.5 million for the three months ended March 31, 2024). (5) Includes capitalized exploration at Young-Davidson of $2.0 million for the three months ended March 31, 2025 ($1.0 million for the three months ended March 31, 2024). (6) Includes capitalized exploration at Mulatos District of $0.7 million for the three months ended March 31, 2025 ($1.9 million for the three months ended March 31, 2024). (7) The Island Gold District includes Island Gold and Magino mines for the three months ended March 31, 2025. Comparative prior year period figures do not include the Magino mine, as the acquisition of the Magino mine was completed on July 12, 2024. (8) The Mulatos District includes Mulatos and La Yaqui Grande mines. (9) Sustaining capital expenditures for Island Gold District include certain finance leases classified as sustaining.

Environment, Social and Governance Summary Performance

Health and Safety

Total recordable injury frequency rate 1 of 1.49 in the first quarter, a 34% decrease from 2.25 in the fourth quarter of 2024 Lost time injury frequency rate 1 of 0.09 in the first quarter, consistent with the fourth quarter of 2024 During the first quarter, Alamos had 17 recordable injuries across its sites and one lost time injury

Alamos strives to maintain a safe, healthy working environment for all, with a strong safety culture where everyone is continually reminded of the importance of keeping themselves and their colleagues healthy and injury-free. The Company’s overarching commitment is to have all employees and contractors return Home Safe Every Day .

Environment

Zero significant environmental incidents and two minor reportable spills in the first quarter Continued reclamation activities at Mulatos for the Cerro Pelon, El Victor and San Carlos pits

Two minor reportable events occurred during the first quarter. At Young-Davidson, a minor spill of process water occurred within the paste plant which was promptly contained and recovered, preventing it from entering the surrounding environment. The second reportable incident involved a supplier's equipment malfunction during the transfer of natural gas tanks. Both incidents were promptly reported to regulators.

The Company is committed to preserving the long-term health and viability of the natural environment that surrounds its operations and projects. This includes investing in new initiatives to reduce the Company's environmental footprint with the goal of minimizing the impacts of its activities.

Community

Ongoing donations, medical support and infrastructure investments were provided to local communities, including:

Significant donations to support the needs of two hospitals in the Algoma region, including contributions for the purchase of new medical imaging equipment. Additionally, donated CAD$66,000 to fund the acquisition of an SCBA Filling Station for the Matachewan Fire Department Committed CAD$300,000 over three years to the Museum of Northern History in Kirkland Lake, Ontario, to support its reopening and continued operation Delivered continuous health services to the local community near the Mulatos District, offering dental services, medical consultations and essential medications to residents

The Company believes that excellence in sustainability provides a net benefit to all stakeholders. The Company continues to engage with local communities to understand local challenges and priorities. Ongoing investments in local infrastructure, health care, education, cultural and community programs remain a focus of the Company.

Governance and Disclosure

Completed annual fieldwork and assurance of Alamos’ compliance with the World Gold Council’s Responsible Gold Mining Principles ("RGMPs"). Alamos will publish its 2024 RGMP Report in the second quarter of 2025

The Company maintains the highest standards of corporate governance to ensure that corporate decision-making reflects its values, including the Company’s commitment to sustainable development.

(1) Frequency rate is calculated as incidents per 200,000 hours worked.

Outlook and Strategy

| 2025 Guidance | | | | | | | | | | | | Island Gold District | | Young-Davidson | | Mulatos District | | Lynn Lake | | Total | | Gold production ( 000's ounces) | 275 - 300 | | 175 - 190 | | 130 - 140 | | — | | 580 - 630 | | Cost of sales, including amortization _(in millions) _(3) | | | | | | | | | $805 | | Cost of sales, including amortization _($ per ounce) _(3) | | | | | | | | | $1,330 | | Total cash costs _($ per ounce) _(1) | $725 - $775 | | $1,075 - $1,125 | | $925 -$975 | | — | | $875- $925 | | All-in sustaining costs _($ per ounce) _(1) | | | | | | | | | $1,250 - $1,300 | | Mine-site all-in sustaining costs _($ per ounce) _(1)(2) | $1,100 - $1,150 | | $1,390 - $1,440 | | $1,025 - $1,075 | | — | | | | Capital expenditures (in millions) | | | | | | | | | | | Sustaining capital (1) | $80 - $85 | | $55 - $60 | | $3 - $5 | | — | | $138 - $150 | | Growth capital (1) | $270 - $300 | | $15 - $20 | | $37 - $40 | | $100 - $120 | | $422- $480 | | Total Sustaining and Growth Capital (1) | $350 - $385 | | $70 - $80 | | $40 - $45 | | $100 - $120 | | $560 - $630 | | Capitalized exploration (1) | $20 | | $9 | | $6 | | $4 | | $39 | | Total capital expenditures and capitalized exploration (1) | $370 - $405 | | $79 - $89 | | $46 - $51 | | $104 - $124 | | $599 - $699 |

(1) Refer to the "Non-GAAP Measures and Additional GAAP" disclosure at the end of this press release and associated MD&A for a description of these measures. (2) For the purposes of calculating mine-site all-in sustaining costs at individual mine sites, the Company does not include an allocation of corporate and administrative expense and corporate share-based compensation expenses to the mine sites. (3) Cost of sales includes mining and processing costs, royalties, and amortization expense, and is calculated based on the mid-point of total cash cost guidance.

The Company’s objective is to operate a sustainable business model that supports growing returns to all stakeholders over the long-term, through growing production, expanding margins, and increasing profitability. This includes a balanced approach to capital allocation focused on generating strong ongoing free cash flow while re-investing in high-return internal growth opportunities and supporting higher returns to shareholders.

In January 2025, the Company provided three-year production and operating guidance, which outlined growing production at declining costs over the next three years. Refer to the Company’s guidance press release for a summary of the key assumptions and related risks associated with the comprehensive 2025 guidance and three-year production, cost and capital outlook. The Company's cost and capital guidance does not factor any potential impact from tariffs introduced by the United States on imports from countries including Canada and Mexico or potential retaliatory tariffs on imports from the United States. The Company does not expect its revenue structure will be impacted by the tariffs as its gold production is refined in Canada or Europe. The Company’s cost structure predominantly relates to input costs which are not expected to be directly affected by the tariffs, including labour and contractors. The Company will continue to monitor developments and may take steps to limit the impact of any tariffs as may be appropriate in the circumstances.

First quarter production of 125,000 ounces was in-line with the low end of quarterly guidance with a solid quarter from Island Gold offsetting lower production from Young-Davidson and Magino. Following the implementation of a number of optimization initiatives within the Magino mill during the second half of 2024, and early 2025, the operation demonstrated significant improvements in the latter portion of the first quarter. This progress has continued into the second quarter with milling rates averaging approximately 9,500 tonnes per day ("tpd") in the last two weeks of April with further improvement expected in May.

Higher milling rates at Magino along with increased grades at Young-Davidson and La Yaqui Grande are expected to drive stronger production in the second quarter of between 135,000 and 150,000 ounces. A more significant increase in production is expected into the second half of 2025 driven by higher grades and mining rates at Island Gold, and increasing grades at La Yaqui Grande. The Company remains on track to achieve annual production guidance of between 580,000 and 630,000 ounces.

Reflecting the expected stronger performance moving forward, the Company expects AISC to decrease approximately 20% in the second quarter, with further decreases the remainder of the year. The Company is monitoring its full year cost guidance given higher share-based compensation and royalty costs compared to guidance, which are impacted by factors outside of the Company's control. Excluding the impact of these variables, the Company remains confident with its full year cost guidance.