Roxgold Inc. (“Roxgold” or the “Company”) (TSX: ROXG) (OTCQX: ROGFF) today reported its third quarter and first nine months financial results for the period ended September 30, 2020.
Q3 2020 Highlights:
During the three and nine-month period ended September 30, 2020, the Company:
- Produced 33,557 ounces of gold at an average grade of 7.7 grams per tonne in Q3 2020, totalling 98,749 ounces produced for YTD 2020
- Reported quarterly plant throughput of 1,424 tonnes per day (“tpd”) for a total of 131,029 tonnes which exceeded increased nameplate capacity of 1,100 tpd by approximately 29%
- Maintained upper end of annual gold production guidance between 120,000 and 130,000 ounces subject to existing operating conditions being maintained
- Reported an interim Reserves and Resources estimate at Yaramoko with total Proven and Probable Mineral Reserves increasing by 8% to 710,000 ounces of gold replacing depletion of 207,396 ounces during the period from December 31, 2018 to June 30, 2020. Measured and Indicated Mineral Resources increased 4% to 857,000 ounces of gold, increasing the mineral endowment of Measured and Indicated Resources plus cumulative production to date at Yaramoko to 1.4 million ounces
- Sold 30,401 ounces of gold for a total of $57.4 million in gold sales (34,200 ounces1 and $50.2 million1 respectively in Q3 2019) and 96,806 ounces for $167.5 million YTD 2020 (100,100 ounces1 and $136.0 million1 respectively YTD 2019)
- Cash and doré on hand increased by $11.4 million over the quarter after growth expenditure of $7.9 million
- Achieved EBITDA2 of $20.6 million in Q3 2020 compared to $16.5 million in Q3 2019
- Generated cash flow from mining operations2 totalling $28.2 million for cash flow from mining operations per share2 of $0.08 (C$0.10/share)
- Adjusted net income2 of $10.6 million ($0.03 per share) compared to $7.7 million ($0.02 per share) in Q3 2019
- Produced a mine operating margin2 of $1,152 per ounce in Q3 2020 and a return on equity2 of 18%
- Received Environmental and Social Impact Assessment approval and advanced drilling at the Séguéla Gold Project to support the upcoming Feasibility Study which remains on track for the first half of 2021
- Announced discovery of the Koula prospect, at Séguéla, with over 40 holes drilled to date demonstrating wide intersections of high grades, including 109 g/t over 4m in hole SGRC919 and 26.1 g/t over 19m in hole SGRC877
- Tested additional mineralization corridors at Boussoura, in southern Burkina Faso, identifying over 9 mineralized vein sets over 4 vein corridors with high grade results such as 4.8m at 26.9g/t Au from BSR-20-RD-FFR-040 and 9m at 10.7g/t Au from BSR-20-RC-FFR-063
- Reported one Lost Time Injury (“LTI”) incident at Yaramoko. This was the first LTI incident at Yaramoko since September 2018
- Management of the current global COVID-19 crisis is ongoing with operations at Yaramoko not materially impacted with heightened preventative measures and response plans in place to mitigate and minimize any potential impacts. Operations continue to operate with reduced personnel due to COVID-19 travel restrictions and protection protocols. The Company is continually assessing the health and safety risks to the Company’s personnel and contractors at its operations and offices
“The Yaramoko Mine Complex has continued to outperform this year as the mine is on track to achieve the upper end of our guidance with record margins,” commented John Dorward, President and CEO of Roxgold. “In the quarter, we achieved adjusted net income of US$10.6 million, generated over US$28 million in cash flow from mining operations and reported a return on equity of 18%. Our financial performance has been driven by the strong operational performance with 98,749 ounces of gold produced in the first nine months of this year, putting the company well on its way towards hitting the upper end of our annual production guidance of 120,000 to 130,000 ounces. Today, we also announced an updated Mineral Reserve and Mineral Resource estimate for Yaramoko, which saw the mine grow its Mineral Reserves by 7% to 710,000 ounces of gold and Measured and Indicated Mineral Resources by 4% to 857,000 ounces of gold. This increase demonstrates the ability of Yaramoko to continue to replace production, reinforcing the project as a stable foundation of long-term production and free cash flow generation for Roxgold’s ambitious growth plans.
“Our global teams continue to manage the operational challenges related to the ongoing COVID pandemic to ensure a safe and secure working environment for our employees, contractors and local communities. The travel restrictions and distancing protocols that have been effective in curtailing the impacts of the coronavirus have necessitated adjusted schedules of mining personnel with correspondent impacts on mining volumes and costs. Despite these challenges, we have continued to strengthen our balance sheet, with cash and doré on hand increasing by $11.4 million to $56.4 million, while maintaining good momentum on production over the quarter.
“Looking ahead, the Séguéla Gold Project in Cote d’Ivoire continues to return excellent exploration results as the project progresses towards the completion of the Feasibility and construction decision in the first half of next year – which will put the project on track for pouring first gold in 2022. Séguéla saw notable developments last quarter, including the approval of the Environmental and Social Impact Assessment and the discovery of the newest high-grade deposit – Koula. Initial site works will be commenced soon to enable a rapid construction ramp up following completion of the Feasibility Study. We currently have four drills turning at Séguéla, with a focus on extension and infill drilling at Koula and the continued scout testing of the extensive portfolio of targets within our land package.”
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