IAMGOLD Reports Fourth Quarter and Year-End 2022 Results

2023-02-16

TSXV - TSX Venture Exchange · Silver · Gold · Zinc · Lead · Copper · Antimony · Tellurium · Arsenic · Bismuth · Iron · Gallium · Germanium · Canada

All monetary amounts are expressed in U.S. dollars, unless otherwise indicated.

Toronto, Ontario--(Newsfile Corp. - February 16, 2023) - IAMGOLD Corporation(NYSE: IAG) (TSX: IMG) ("IAMGOLD" or the "Company") today reported its financial and operating results for the fourth quarter and year ended December 31, 2022. Preliminary operating results for the fourth quarter and year ended 2022 were disclosed on January 17, 2023.

HIGHLIGHTS:

Operations

Attributable gold production was 185,000 ounces in the fourth quarter and 713,000 ounces for the year, above the top end of revised production guidance of 650,000 to 705,000 ounces.

Cost of sales per ounce sold in the fourth quarter was $1,130, cash cost1per ounce sold was $1,173 and all-in sustaining cost1("AISC") per ounce sold was $1,672. Cash cost1per ounce sold of $1,109 for the year was within the bottom end of the revised guidance range of $1,100 to $1,130 per ounce sold and AISC1per ounce sold of $1,581 for 2022 was below the bottom end of the revised range of $1,600 to $1,650 per ounce sold.

Attributable gold production from continuing operations, excluding Rosebel, was 116,000 ounces in the fourth quarter and 499,000 ounces for the year. Cost of sales per ounce sold in the fourth quarter was $1,157 ($1,041 for 2022), cash cost1per ounce sold in the fourth quarter was $1,226 ($1,052 for 2022) and AISC1per ounce sold in the fourth quarter was $1,741 ($1,508 for 2022) on the same basis.

Financial

Net earnings (loss) and adjusted net loss per share attributable to equity holders1of $(0.01) and $(0.02) for the fourth quarter, respectively and net earnings (loss) and adjusted net earnings (loss) per share attributable to equity holders1of $(0.12) and $(0.07) for the year ended December 31, 2022, respectively.

Net cash from operating activities was $12.3 million for the fourth quarter and $257.6 million for the year. Net cash from operating activities, before movements in non-cash working capital and non-current ore stockpiles, was $36.2 million for the fourth quarter and $298.2 million for the year.

Earnings before interest, income taxes, depreciation and amortization ("EBITDA")1from continuing operations was $57.8 million during the fourth quarter ($292.3 million for 2022) and adjusted EBITDA1from continuing operations was $38.9 million for the fourth quarter ($313.4 million for 2022).

Mine-site free cash flow1from continuing operations was negative $21.9 million for the fourth quarter ($167.2 million for 2022) and from all operations was $0.2 million for the fourth quarter ($187.6 million for 2022).

Cash and cash equivalents held by continuing operations of $407.8 million and liquidity1of $434.4 million at December 31, 2022. Cash and cash equivalents of $40.8 million was held by discontinued operations and assets held for sale at December 31, 2022.

Côté Gold

As of December 31, 2022, the Côté Gold project was estimated to be approximately 73% complete.

The estimated attributable cost to complete the construction, on an incurred basis, and the Company's attributable funding requirement for 2023 is $800 to $875 million, assuming a USDCAD rate of 1.32. Sumitomo is expected to fund approximately $340 million of the 2023 funding requirement as per the amended Côté Gold Joint Venture Agreement ("Amended JVA"), requiring IAMGOLD to fund $460 to $535 million during 2023.

The Company believes that the aggregate proceeds from the sale of its interest in the Rosebel mine, the anticipated proceeds from the sale of the Bambouk assets and funds to be provided by Sumitomo under the Amended JVA meet the estimated remaining funding requirements for the completion of construction at the Côté Gold Project based on the current schedule and estimate.

On February 2, 2023, the Company announced additional assay results from its ongoing diamond drilling program at the Gosselin zone, supporting the anticipated expansion potential at Gosselin, specifically south of and below the interpreted resource boundaries of the deposit model.

Corporate

On December 19, 2022, the Company announced that it had entered into an agreement with Sumitomo Metal Mining Co., Ltd. and SMM Gold Cote Inc. ("Sumitomo" or "SMM") to amend the Côté Gold Joint Venture Agreement. Commencing in January 2023, Sumitomo will contribute certain of the Company's funding amounts to the Côté Gold Project that in aggregate are expected to total approximately $340 million over the course of 2023. As a result of Sumitomo funding such amounts, the Company will progressively transfer, in aggregate, an approximate 10% interest in Côté to SMM (the "Transferred Interests") as funding is made by SMM, subject to the right for the Company to repurchase the Transferred Interests at one of seven future dates pursuant to the terms of the Amended JVA, to return to its full 70% interest in the Côté Gold Project. Subsequent to December 31, 2022, SMM funded $126.4 million under the funding arrangement, resulting in the Company's interest in the Côté Gold project being diluted by 5.0% to 65.0%.

On December 20, 2022, the Company announced it had entered into definitive agreements with Managem, S.A (CAS: MNG) ("Managem") to sell, for aggregate consideration of approximately $282 million, the Company's interests in its exploration and development projects in Senegal, Mali and Guinea.

On January 31, 2023 the Company completed the sale of its interests in the Rosebel mine to Zijin Mining Group Co. Ltd. that was announced on October 18, 2022. The transaction closed on January 31, 2023 and the Company received net proceeds of $371.5 million, consisting of sale proceeds of $360.0 million, plus $15.0 million of cash held by Rosebel on January 31, 2023, less a preliminary working capital adjustment of $3.5 million. The Company is due to receive approximately $24.8 million by March 31, 2023 consisting of the balance of cash held by Rosebel on January 31, 2023, subject to final working capital adjustments.

Outlook

Attributable gold production for 2023, excluding Rosebel, is expected to be in the range of 410,000 to 470,000 ounces, with Essakane attributable gold production expected to be in the range of 340,000 to 380,000 ounces and Westwood gold production is expected to be in the range of 70,000 to 90,000 ounces.

Cash costs¹ are expected to be between $1,125 and $1,175 per ounce sold, and AISC1per ounce sold is expected to be in the range of $1,625 to $1,700 per ounce sold. The estimate includes assumptions related to the escalated pricing levels of certain consumables as experienced during the second half of 2022. Cash costs and AISC per ounce sold in the first half of 2023 are expected to be at or above the high end of the annual guidance range due to lower gold production and sales volumes, in addition to higher waste stripping in accordance with the mine plans, as compared to the second half of the year.

"IAMGOLD is successfully emerging from a period of significant transformation over the past year, which was made possible by the dedication and resiliency of our employees at every level of the company who have demonstrated a commitment to working safely and responsibly towards a shared vision of generating superior value for our stakeholders through accountable mining," said Maryse Bélanger, Chair and Interim President and Chief Executive Officer of IAMGOLD. "Operationally, the Company finished the year with a strong quarter, driving production above the top end of our revised guidance estimates. Our construction teams at Côté Gold continued to advance the project allowing for critical project activities to move inside the plant during the winter season while accelerating the deployment of the autonomous haulage and drilling systems to better position the project for commencement of production next year. Financially, the Company ended the year in a much stronger position with the announcement of key strategic transactions, including the amended agreement with our partner Sumitomo Metal Mining."

"As we look forward, 2023 will be a pivotal year for the Company, with a strong focus on continuing to execute at Côté. We remain on track to commence production at Côté early next year and are eager to showcase what will be Canada's third largest gold mine by production. In 2022, the industry was faced with considerable inflationary headwinds, and this year is expected to continue to underscore the necessity to focus on safety, productivity and efficiency at all our operations. At Essakane, following a record performance last year, we will be conducting additional stripping in the first half of the year to position the mine for stronger production in the second half; while at Westwood, we expect to see continued gains in underground development providing access to higher grade zones in the second half of the year."

QUARTERLY REVIEW

The following tables summarize certain operating and financial results for the three months ended December 31, 2022 (Q4 2022) and December 31, 2021 (Q4 2021) and the twelve months ended December 31 for 2022 and 2021; and certain measures of the Company's financial position as at December 31, 2022 and December 31, 2021:

| | | Q4 2022 | | | Q4 2021 | | | 2022 | | | 2021 | | Key Operating Statistics | | | | | | | | | | | | | Gold production - attributable (000s oz) | | | | | | | | | | | | | - Essakane | | 98 | | | 98 | | | 432 | | | 412 | | - Westwood | | 18 | | | 13 | | | 67 | | | 35 | | Total from continuing operations | | 116 | | | 111 | | | 499 | | | 447 | | - Rosebel | | 69 | | | 42 | | | 214 | | | 154 | | Total gold production - attributable (000s oz) | | 185 | | | 153 | | | 713 | | | 601 | | Gold sales - attributable (000s oz) | | | | | | | | | | | | | - Essakane | | 97 | | | 93 | | | 440 | | | 408 | | - Westwood | | 18 | | | 12 | | | 66 | | | 34 | | Total from continuing operations | | 115 | | | 105 | | | 506 | | | 442 | | - Rosebel | | 68 | | | 47 | | | 215 | | | 148 | | Total gold sales - attributable (000s oz) | | 183 | | | 152 | | | 721 | | | 590 | | Cost of sales1($/oz sold) - attributable | | | | | | | | | | | | | - Essakane | $ | 958 | | $ | 1,333 | | $ | 882 | | $ | 1,042 | | - Westwood | | 2,230 | | | 2,335 | | | 2,093 | | | 2,252 | | Total from continuing operations | $ | 1,157 | | $ | 1,451 | | $ | 1,041 | | $ | 1,135 | | - Rosebel | | 1,085 | | | 1,922 | | | 1,269 | | | 1,674 | | Total cost of sales1($/oz sold) - attributable | $ | 1,130 | | $ | 1,597 | | $ | 1,109 | | $ | 1,270 | | Cash costs2($/oz sold) - attributable | | | | | | | | | | | | | - Essakane | $ | 1,043 | | $ | 912 | | $ | 899 | | $ | 945 | | - Westwood | | 2,210 | | | 2,325 | | | 2,068 | | | 2,240 | | Total from continuing operations | $ | 1,226 | | $ | 1,079 | | $ | 1,052 | | $ | 1,045 | | - Rosebel | | 1,083 | | | 1,514 | | | 1,243 | | | 1,545 | | Total cash costs2($/oz sold) - attributable | $ | 1,173 | | $ | 1,213 | | $ | 1,109 | | $ | 1,170 | | AISC2($/oz sold) - attributable | | | | | | | | | | | | | - Essakane | $ | 1,456 | | $ | 1,150 | | $ | 1,234 | | $ | 1,074 | | - Westwood | | 2,639 | | | 2,775 | | | 2,568 | | | 2,600 | | Total from continuing operations | $ | 1,741 | | $ | 1,410 | | $ | 1,508 | | $ | 1,281 | | - Rosebel | | 1,554 | | | 1,824 | | | 1,753 | | | 1,859 | | Total AISC2($/oz sold) - attributable | $ | 1,672 | | $ | 1,537 | | $ | 1,581 | | $ | 1,426 | | Average realized gold price($/oz) | | | | | | | | | | | | | - Continued operations | $ | 1,639 | | $ | 1,794 | | $ | 1,721 | | $ | 1,793 | | - Discontinued operations | | 1,725 | | | 1,795 | | | 1,793 | | | 1,777 | | Total average realized gold price($/oz) | $ | 1,670 | | $ | 1,794 | | $ | 1,741 | | $ | 1,790 | | Gold margin ($/oz) from continuing operations | $ | 413 | | $ | 715 | | $ | 669 | | $ | 748 |

1. Throughout this news release, cost of sales, excluding depreciation, is disclosed in the cost of sales note in the annual consolidated financial statements. 2. This is a non-GAAP measure. See "Non-GAAP Financial Measures" disclosure at the end of this news release for a description and calculation of these measures.

| | | Q4 2022 | | | Q4 2021 | | | 2022 | | | 2021 | | Financial Results ($ millions) | | | | | | | | | | | | | Revenues | $ | 207.2 | | $ | 206.4 | | $ | 958.8 | | $ | 875.5 | | Gross profit | $ | 20.0 | | $ | (42.7) | | $ | 147.9 | | $ | 62.2 | | EBITDA1 | $ | 105.4 | | $ | (193.4) | | $ | 300.4 | | $ | 27.1 | | - Continuing operations | $ | 57.8 | | $ | 16.7 | | $ | 292.3 | | $ | 216.6 | | - Discontinued operations | $ | 47.6 | | $ | (210.1) | | $ | 8.1 | | $ | (189.5) | | Adjusted EBITDA1 | $ | 83.6 | | $ | 90.0 | | $ | 434.0 | | $ | 355.7 | | - Continuing operations | $ | 38.9 | | $ | 74.3 | | $ | 313.4 | | $ | 307.0 | | - Discontinued operations | $ | 44.7 | | $ | 15.7 | | $ | 120.6 | | $ | 48.7 | | Net earnings (loss) attributable to equity holders | $ | 24.0 | | $ | (194.1) | | $ | (70.1) | | $ | (254.4) | | - Continuing operations | $ | (3.8) | | $ | (51.9) | | $ | (55.5) | | $ | (95.8) | | - Discontinued operations | $ | 27.8 | | $ | (142.2) | | $ | (14.6) | | $ | (158.6) | | Adjusted net earnings (loss) attributable to equity holders1 | $ | 16.6 | | $ | 44.3 | | $ | 22.7 | | $ | 26.8 | | - Continuing operations | $ | (9.0) | | $ | 36.3 | | $ | (35.6) | | $ | 25.0 | | - Discontinued operations | $ | 25.6 | | $ | 8.0 | | $ | 58.3 | | $ | 1.8 | | Net earnings (loss) per share attributable to equity holders - continuing operations | $ | (0.01) | | $ | (0.11) | | $ | (0.12) | | $ | (0.20) | | Adjusted net earnings (loss) per share attributable to equity holders1- continuing operations | $ | (0.02) | | $ | 0.08 | | $ | (0.07) | | $ | 0.05 | | Net cash from operating activities before changes in working capital1- continuing operations | $ | 36.2 | | $ | 63.3 | | $ | 298.2 | | $ | 256.0 | | Net cash from operating activities | $ | 66.8 | | $ | 67.5 | | $ | 408.7 | | $ | 285.0 | | - Continuing operations | $ | 12.3 | | $ | 52.7 | | $ | 257.6 | | $ | 257.8 | | - Discontinued operations | $ | 54.5 | | $ | 14.8 | | $ | 151.1 | | $ | 27.2 | | Mine-site free cash flow1 | $ | 0.2 | | $ | 10.8 | | $ | 187.6 | | $ | 128.3 | | - Continuing operations | $ | (21.9) | | $ | 26.5 | | $ | 167.2 | | $ | 199.6 | | - Discontinued operations | $ | 22.1 | | $ | (15.7) | | $ | 20.4 | | $ | (71.3) | | Capital expenditures1,2,3- sustaining | $ | 50.6 | | $ | 28.1 | | $ | 190.4 | | $ | 63.2 | | Capital expenditures1,2,3- expansion | $ | 137.6 | | $ | 173.0 | | $ | 554.2 | | $ | 463.9 | | | | Dec 31 | | | Dec 31 | | | Dec 31 | | | Dec 31 | | | | 2022 | | | 2021 | | | 2022 | | | 2021 | | Financial Position ($ millions from continuing operations) | | | | | | | | | | | | | Cash, cash equivalents and short-term investments | $ | 407.8 | | $ | 552.5 | | $ | 407.8 | | $ | 552.5 | | Long-term debt | $ | 918.7 | | $ | 464.4 | | $ | 918.7 | | $ | 464.4 | | Net cash (debt)3 | $ | (605.6) | | $ | 16.3 | | $ | (605.6) | | $ | 16.3 | | Available credit facility | $ | 26.6 | | $ | 498.3 | | $ | 26.6 | | $ | 498.3 |

1. This is a non-GAAP measure. See "Non-GAAP Financial Measures" disclosure at the end of this news release for a description and calculation of these measures. 2. Throughout this news release, capital expenditures represent cash expenditures for property, plant and equipment and exploration and evaluation assets. 3. Starting in 2022, a higher portion of stripping costs are categorized as sustaining capital versus expansion capital, due to the particular areas that are scheduled to be mined and the stage of the life of mine aligning with World Gold Council guidelines. See "Non-GAAP Financial Measures section".

Operating Results - Continuing Operations

Note that all figures below are reflective of continuing operations and exclude Rosebel

Attributable gold production for the fourth quarter was 116,000 ounces, up 5,000 ounces or 5% from the prior year period, due to higher production at Westwood resulting from higher mill throughput and grades. Attributable gold production for the full year 2022 was 499,000 ounces, up 52,000 ounces or 12% from the prior year period, due to higher production at Westwood (32,000 ounces) as the underground operations continue ramping up after being in care and maintenance in the first half of 2021 and Essakane (20,000 ounces) resulting from higher grade and recoveries, partially offset by lower throughput.

Attributable gold sales for the fourth quarter was 115,000 ounces, up 10,000 ounces or 10% from the prior year period, due to higher production at Westwood (6,000 ounces) and timing of sales at Essakane (4,000 ounces). Attributable gold sales for the full year 2022 was 506,000 ounces, up 64,000 ounces or 14%, due to higher production and timing of sales at Essakane (32,000 ounces) and higher production at Westwood (32,000 ounces). The average realized gold price for the fourth quarter and the full year 2022 was $1,639 per ounce and $1,721 per ounce, respectively, reflecting the monthly physical gold deliveries of 12,500 ounces at $1,500 per ounce as required under the 2019 Prepay Arrangement. During the year ended December 31, 2022, the Company delivered 150,000 ounces into the 2019 Prepay Arrangement and received $30.0 million in cash in relation to the collar.

Cost of sales (excluding depreciation) per ounce sold for the fourth quarter was $1,157, down $294 or 20% from the prior year period, due to the Essakane NRV adjustment of $441 per ounce sold included in 2021 and higher gold sales, partially offset by higher production costs in the fourth quarter of 2022. Cost of sales includes the positive impact of realized derivative gains of $24 per ounce sold (fourth quarter 2021 - gains of $24 per ounce sold). Cost of sales (excluding depreciation) per ounce sold for the full year 2022 was $1,041, down $94 or 8% from the prior year period, due to the Essakane NRV adjustment of $100 per ounce sold included in 2021 and higher gold sales, partially offset by higher production costs in 2022.

Cash costs per ounce sold in the fourth quarter were $1,226, up $147 per ounce or 14% from the prior year period, primarily due to higher production costs, partially offset by higher gold sales. Cash costs per ounce sold for the full year 2022 were $1,052, in line with the prior year period, as higher production costs were offset by higher gold sales. AISC per ounce sold in the fourth quarter were $1,741, up $331 per ounce or 23% from the prior year period, primarily due to higher production costs and higher sustaining capital expenditures, partially offset by higher gold sales. AISC per ounce sold for the full year 2022 were $1,508, up $227 or 18% from the prior year period, due to higher sustaining capital expenditures, primarily at Essakane.

Health and Safety

IAMGOLD is committed to maintaining its culture of accountable mining through high standards of ESG practices and the principle of Zero Harm®in every aspect of its business, with particular emphasis on respecting the natural environment, building strong community partnerships and putting the health and safety of the Company's employees first.

Health and safety is core to the Company's relentless pursuit of its Zero Harm®vision. An IAMGOLD employee sadly lost his life in November in Burkina Faso as a result of injuries sustained in an off-site accident. A thorough investigation has been undertaken to implement improvements to prevent future recurrences and respect the Company's Zero Harm®principle. Côté Gold surpassed over 8.3 million hours with no lost time injuries to date. The DARTFR (days away, restricted, transferred duty frequency rate) was 0.31 as of the end of 2022 (compared to 0.37 as of the end of 2021), tracking below the global annual target of 0.42, with an increasing trend since October 2022. The TRIFR (total recordable injuries frequency rate) was 0.76 as of the end of 2022 (compared to 0.76 as of the end of 2021), tracking above the global annual target of 0.73.

Financial Results

Revenues from continuing operations of $207.2 million in the fourth quarter from sales of 126,000 ounces (115,000 ounces on an attributable basis) at an average realized gold price of $1,639 per ounce and $958.8 million for the year from sales of 555,000 ounces (506,000 ounces on an attributable basis) at an average realized gold price of $1,721 per ounce.