Production and Cost Performance Meets Upgraded Guidance
VANCOUVER, BC, Feb. 22, 2024 /CNW/ – Lundin Gold Inc. (TSX:LUG); (Nasdaq Stockholm: LUG); (OTCQX:LUGDF) (“Lundin Gold” or the “Company”) is pleased to report results for the fourth quarter and year ended December 31, 2023. Lundin Gold’s year is highlighted by its production of 481,274 oz of gold at an all-in sustaining cost (“AISC”)1 of $860 per oz sold, meeting upwardly revised production guidance of 450,000 to 485,000 oz and AISC1 guidance of $820 to $870 per oz sold. Cash from operating activities of $519 million was generated for the year resulting in free cash flow¹ of $263 million which is net of a one-time interest and finance charge payment of $129 million from the full repayment of the gold prepay facility (the “Gold Prepay Facility”). All amounts are in U.S. dollars unless otherwise indicated. PDF Version
Ron Hochstein, President and CEO commented, “Lundin Gold continues its strong track record by meeting its upgraded production and improved cost guidance for 2023, and in doing so generating significant cash flow. Looking ahead to 2024, we are focused on operational excellence and delivering the Process Plant Expansion Project to achieve increased throughput and recovery improvements. Furthermore, we continue to make significant headway on our exciting exploration programs; 2024 will be the largest drilling program ever conducted in the district that hosts Fruta del Norte. We expect continued generation of free cash flow, which will enable the Company to continue to pursue debt reduction, M&A and potential increase in returns to shareholders through increased dividends.”
The following two tables provide an overview of key operating and financial results.
Three months ended
December 31,
Year ended
December 31,
2023
2022
2023
2022
Tonnes ore mined
405,705
365,250
1,635,550
1,492,230
Tonnes ore milled
427,743
420,838
1,654,520
1,559,178
Average head grade (g/t)
8.2
10.0
10.2
10.6
Average recovery
88.1 %
89.6 %
88.4 %
89.5 %
Average mill throughput (tpd)
4,649
4,574
4,533
4,272
Gold ounces produced
99,310
121,139
481,274
476,329
Gold ounces sold
98,005
119,890
474,365
470,103
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1 Certain additional disclosures for these specified financial measures have been incorporated by reference and can be found on pages 16 to 18 of the Company’s MD&A for the year ended December 31, 2023 available on SEDAR+.
Three months ended
December 31,
Year ended
December 31,
2023
2022
2023
2022
Net revenues ($’000)
190,688
210,961
902,518
815,666
Average realized gold price ($/oz sold)1
2,021
1,814
1,958
1,789
Income from mining operations ($’000)
78,051
92,095
435,180
369,754
Earnings before interest, taxes, depreciation, and amortization ($’000)2
67,274
141,274
493,976
543,660
Adjusted earnings before interest, taxes, depreciation, and amortization ($’000)1
95,908
112,057
526,045
467,343
Net income (loss) ($’000)
11,062
(68,259)
179,457
73,558
Basic income (loss) per share ($)
0.05
(0.29)
0.76
0.31
Cash provided by operating activities ($’000)
92,574
133,390
519,395
426,145
Free cash flow ($’000)1
62,330
91,179
263,473
269,435
Cash operating cost ($/oz sold)1
832
713
697
671
All-in sustaining costs ($/oz sold)1
1,062
865
860
805
Free cash flow per share ($)1
0.26
0.39
1.11
1.15
Adjusted net earnings ($’000)1
33,236
33,584
204,310
125,003
Adjusted net earnings per share ($)1
0.14
0.14
0.86
0.53
Dividends paid ($’000)
23,782
–
94,914
47,033
Dividends paid per share ($)
0.10
–
0.40
0.20
Fourth quarter gold sales of 98,005 oz, consisting of 65,223 oz of concentrate and 32,782 oz of doré, at an average realized gold price1 of $2,021 per oz for total gross revenues from gold sales of $198 million. For 2023, sales totalled 481,274 oz gold and total revenues from gold sales amounted to $929 million.
Net of treatment and refining charges, revenues in the fourth quarter and 2023 were $191 million and $903 million, respectively.
Cash operating costs1 and AISC1 for the quarter were $832 and $1,062 per oz of gold sold, respectively. Both metrics were impacted by a decrease in oz sold compared to previous quarters. In particular, AISC1 was impacted by the timing of sustaining capital expenditures incurred to complete the fourth raise of the tailings dam plus other projects, including the underground maintenance facility. For 2023, cash operating costs1 and AISC1 were $697 and $860 per oz of gold sold, respectively, which are in line with the Company’s improved 2023 guidance.
Cash provided by operating activities was $92.6 million in the fourth quarter and the Company generated free cash flow1 of $62.3 million from operations, or $0.26 per share. For 2023, cash from mining operations was $519 million, and the Company generated free cash flow1 of $263 million, or $1.11 per share. At the end of 2023, the Company had a cash balance of $268 million.
Earnings before interest, taxes, depreciation, and amortization1 (“EBITDA”) and adjusted EBITDA1 during the fourth quarter were $67.3 million and $95.9 million, respectively, with the difference resulting from derivative losses recognized during the year. For the year, EBITDA1 and adjusted EBITDA1 were $494 million and $526 million, respectively.
In the fourth quarter, net income was $11.1 million including a derivative loss of $28.6 million, and net …
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