137,144 Ounces of Gold Sold, on Track to Achieve 2021 Guidance
Equinox Gold Corp. (TSX: EQX) (NYSE American: EQX) is pleased to announce its third quarter 2021 summary financial and operating results. The Company’s unaudited condensed consolidated interim financial statements and related management’s discussion and analysis for the three and nine months ended September 30, 2021 will be available for download on SEDAR, on EDGAR and on the Company’s website. The Company will host a conference call and webcast on November 4, 2021 commencing at 7:00 am Pacific time to discuss the Company’s third quarter results and activities underway at the Company’s projects. Further details are provided at the end of this news release.
Christian Milau, CEO of Equinox Gold, commented: “Production continues to increase as we see the benefits of investment at the mine sites during the first half of the year. While increased production from Los Filos and the Brazil mines anchored a strong third quarter for Equinox Gold, approximately one-third of 2021 production will come in the fourth quarter, with more than 65,000 ounces of gold already produced during the month of October.
“During the quarter we made significant progress at our growth and expansion projects. Santa Luz construction is on budget and 70% complete; we started mining ore from the new Guadalupe open pit and Bermejal underground deposits at Los Filos; and our study to expand the Aurizona Mine demonstrated that developing the underground and satellite open-pit deposits will nearly double the mine life and increase annual production. We also recently celebrated groundbreaking at our Greenstone Mine in Ontario, Canada. The groundbreaking event was attended by the Ontario Minister of Mines, the Chiefs of our Indigenous partners, the Mayor of the Municipality of Greenstone and community members. We appreciate their support and enthusiasm for the project and look forward to working with Orion Mine Finance and all of our partners to develop what will be a transformative project for local communities and a cornerstone asset for Equinox Gold.
“Looking ahead, Equinox Gold is on track to achieve its 2021 guidance and expects to realize significant production growth in 2022 as we continue to access higher-grade ore at Los Filos and commence production at Santa Luz, which will be our eighth operating mine. We remain focused on our growth strategy to produce more than one million ounces of gold per year and become the industry’s premier Americas gold producer.”
HIGHLIGHTS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021
Construction, development and exploration
POST QUARTER END HIGHLIGHTS
|1.||Cash costs per oz sold, mine AISC per oz sold, adjusted net loss, adjusted EBITDA, adjusted EPS, sustaining capital, non-sustaining capital and net debt are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.|
|2.||Primary adjustments for the three months ended September 30, 2021 were $11.0 million unrealized gain on change in fair value of gold contracts, $8.9 million unrealized loss on change in fair value of foreign exchange contracts, $7.0 million unrealized loss on change in fair value of streaming arrangements, and $5.3 million loss from investment in associate.|
|3.||A formal construction decision is subject to receiving consent of Equinox Gold’s lenders and the closing of financing by Orion, both of which are expected within the next several weeks.|
|CONSOLIDATED OPERATIONAL AND FINANCIAL HIGHLIGHTS|
|Three months ended||Nine months ended|
|Operating data||Unit||September 30,
|June 30, 2021(1)||September 30,
|Average realized gold price||$/oz||1,780||1,806||1,899||1,790||1,748|
|Total cash cost per oz sold(4)||$/oz||1,109||1,089||876||1,113||849|
|Mine AISC per oz sold(3)(4)||$/oz||1,327||1,382||1,077||1,396||1,001|
|Earnings from mine operations||M$||49.2||45.6||88.7||139.0||192.5|
|Net (loss) income||M$||(5.2)||325.7||3.2||370.8||(69.0)|
|(Loss) earnings per share||$/share||(0.02)||1.10||0.01||1.33||(0.34)|
|Adjusted net income(4)||M$||6.7||3.1||30.8||6.2||46.9|
|Balance sheet and cash flow data|
|Cash and cash equivalents (unrestricted)||M$||300.3||333.9||310.7||300.3||310.7|
|Operating cash flow before changes in non-cash working capital||M$||48.3||31.6||86.2||141.9||177.0|
|1.||Operational and financial results of the assets acquired as part of the acquisition of Premier Gold Mines Limited (“Premier”, and the “Premier Transaction”) are included from April 7, 2021, onward.|
|2.||Operational and financial results of the assets acquired as part of the acquisition of Leagold Mining Corporation (“Leagold”, and the “Leagold Merger”) are included from March 10, 2020, onward.|
|3.||Consolidated mine AISC per oz sold excludes corporate general and administration expenses.|
|4.||Cash cost per oz sold, mine AISC per oz sold, adjusted EBITDA, adjusted net income, adjusted EPS and net debt are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.|
The Company recognized revenue of $245.1 million on sales of 137,144 oz of gold during the three months ended September 30, 2021, compared to revenue for the three months ended June 30, 2021 of $226.2 million on sales of 124,712 oz of gold. The increase in ounces sold from Q2 2021 to Q3 2021 is mainly due to increased production at Aurizona as the change to dry season conditions allowed for increased material movement and access to higher grade material deeper in the pit, and increased production at Los Filos as full operations resumed in late July following the resolution of two blockades.
In Q3 2021, earnings from mine operations were $49.2 million, in-line with $45.6 million in Q2 2021, while net loss in Q3 2021 of $5.2 million compared to net income of $325.7 million in Q2 2021, driven by a $50.3 million gain on sale of Solaris shares, a $186.1 million gain on reclassification of the Company’s Solaris investment from cost to fair value accounting, and a $45.4 million gain on the sale of the Pilar mine in Q2 2021. Q3 2021 net loss was also impacted by smaller increases in the fair value of share purchase warrants and gold contracts as gold prices declined as compared to Q2 2021.
Adjusted EBITDA for Q3 2021 of $62.0 million increased from $52.4 million in Q2 2021, partially due to a decrease in care and maintenance costs, which are expensed directly, at Los Filos as operations resumed following the resolution of blockades. Adjusted net income was $6.7 million for Q3 2021 compared to adjusted net income of $3.1 million in Q2 2021.
SELECTED FINANCIAL RESULTS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2021 AND 2020
|$ amounts in millions, except per share amounts||Three months ended||Nine months ended|
|Depreciation and depletion||(43.3)||(36.1)||(122.7)||(88.2)|
|Earnings from mine operations||49.2||88.7||139.0||192.5|
|Care and maintenance||(6.0)||(13.1)||(15.2)||(35.6)|
|General and administration||(12.4)||(8.1)||(35.3)||(24.3)|
|Income from operations||25.1||64.6||75.2||123.1|
|Other (expense) income||(23.3)||(39.5)||327.5||(117.4)|
|Net (loss) income before taxes||(7.8)||13.0||373.2||(24.1)|
|Current tax expense||(5.1)||(9.3)||(20.3)||(25.4)|
|Deferred tax recovery (expense)||7.7||(0.4)||17.9||(19.4)|
|Net (loss) income||$||(5.2)||$||3.2||$||370.8||$||(69.0)|
|Net (loss) income per share attributable
to Equinox Gold shareholders
|1.||Financial results for the nine months ended September 30, 2021 include the results of operations for the mines acquired through the Premier Acquisition for the period of April 7 to September 30, 2021.|
|2.||Financial results for the nine months ended September 30, 2020 include the results of operations for mines acquired through the Leagold Merger for the period of March 10 to September 30, 2020.|
Additional information regarding the Company’s financial results and activities underway at the Company’s projects is available in the Company’s Q3 2021 Financial Statements and accompanying management’s discussion and analysis for the three and nine months ended September 30, 2021, which will be available for download on the Company’s website at www.equinoxgold.com, on SEDAR at www.sedar.com and on EDGAR at www.sec.gov/edgar.
ABOUT EQUINOX GOLD
Equinox Gold is a Canadian mining company operating entirely in the Americas, with seven operating gold mines and a clear path to achieve more than one million ounces of annual gold production from a pipeline of development and expansion projects.
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