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IAMGOLD Reports Fourth Quarter and Year-End 2023 Results; Provides 2024 Outlook

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IAMGOLD Reports Fourth Quarter and Year-End 2023 Results; Provides 2024 Outlook

 

 

 

 

 

IAMGOLD Corporation (NYSE: IAG) (TSX: IMG) reported its financial and operating results for the fourth quarter and year ended December 31, 2023. The Company also provided updated outlook and operating guidance for 2024. Preliminary operating results for the fourth quarter and year ended 2023 were disclosed on January 22, 2024.

 

“In 2023, IAMGOLD made significant strides towards its goal of becoming a leading mid-tier gold producer with a long life, cornerstone asset in Canada,” said Renaud Adams, President and Chief Executive Officer of IAMGOLD. “Last year saw significant changes in leadership across the organization to allow for a reinforced focus on operations as IAMGOLD prioritizes operational excellence, positions Côté Gold for success, and fosters the talent within the company. Operationally, 2023 was a strong year with attributable gold production from continuing operations of 465,000 ounces, which was at the top end of the guidance range of 410,000 to 470,000 ounces. We congratulate the Essakane team who achieved their targets while facing considerable challenges within the region, and the Westwood team who continue to execute on the plan to ramp up underground operations while employing industry-leading underground seismic monitoring and management.”

 

“Côté Gold construction saw remarkable progress last year,” continued Mr. Adams. “The project entered 2023 with construction approximately 64% complete and finished the year at 98% complete. This progress entailed significant advancement across the project scope, including the mechanical, piping, electrical and instrumentation of the plant, electrification of the site to the provincial hydro grid, initiation and ramp up of mining activities and continued heavy lifting to raise the tailings management facility. Mining activities advanced very well through the year with the successful roll out of Ontario’s first autonomous haulage fleet and stockpiling of approximately 5 million tonnes of ore. During this period, project costs tracked in line with the 2022 updated budget estimate.”

 

“Côté Gold is poised to begin production next month. While first gold is on the horizon, our primary focus and efforts are on positioning the project for a steady ramp up of gold production through the year to achieve commercial production in the third quarter. We are now executing and ramping up commissioning activities, with crushing and screening successfully commissioned, and pre-commissioning ongoing on the HPGR and wet side of the plant. At steady run-rate, Côté Gold will be the third largest gold mine in Canada with an expected mine life exceeding 18 years and significant opportunities for growth.”

 

HIGHLIGHTS:

 

Operating and Financial

  • Attributable gold production from continuing operations was 136,000 ounces for the fourth quarter and 465,000 ounces for the year, at the top end of the guidance range of 410,000 to 470,000 ounces. Essakane had a strong fourth quarter with attributable production of 108,000 ounces and year to date attributable production of 372,000 ounces, which was near the top end of the guidance range of 340,000 to 380,000 ounces. Westwood exceeded the top end of its guidance range of 70,000 to 90,000 ounces with 93,000 ounces produced for the year, including 12,400 ounces produced in December, a record since the mine restarted.
  • In health and safety, for the year ended December 31, 2023, the Company reported a TRIFR (total recordable injuries frequency rate) of 0.69, an improved trend since last year.
  • Revenues from continuing operations were $297.6 million in the fourth quarter from sales of 147,000 ounces (136,000 ounces on an attributable basis) at an average realized gold price1 of $2,005 per ounce and $987.1 million for the year from sales of 503,000 ounces (462,000 ounces on an attributable basis) at an average realized gold price of $1,955 per ounce.
  • Cost of sales per ounce sold in the fourth quarter was $1,201, cash cost1 per ounce sold was $1,197 and all-in-sustaining-cost1 (“AISC”) per ounce sold was $1,735. Cash cost per ounce sold of $1,261 for the year was at the bottom end of the revised guidance range of $1,250 to $1,325 per ounce sold, and AISC per ounce sold of $1,783 for 2023 was within the revised guidance range of $1,750 to $1,825 per ounce sold.
  • Net earnings (loss) and adjusted net earnings (loss) per share attributable to equity holders1 of $(0.02) and $0.06 for the fourth quarter, respectively. Net earnings (loss) and adjusted net earnings (loss) per share attributable to equity holders1 of $0.18 and $0.09 for the year ended December 31, 2023, respectively.
  • Net cash from operating activities was $69.9 million for the fourth quarter and $144.0 million for the year. Net cash from operating activities, before movements in non-cash working capital and non-current ore stockpiles1 was $52.1 million for the fourth quarter and $158.9 million for the year.
  • Earnings before interest, income taxes, depreciation and amortization (“EBITDA”)1 from continuing operations was $70.2 million during the fourth quarter and $366.6 million for the year, and adjusted EBITDA1 was $110.6 million for the fourth quarter and $315.1 million for the year.
  • Mine-site free cash flow1 from continuing operations was $28.9 million for the fourth quarter and $48.2 million for the year.
  • The Company has available liquidity1 of $754.1 million comprised of cash and cash equivalents of $367.1 million and the available balance of the secured revolving credit facility (“Credit Facility”) of $387.0 million as at December 31, 2023.

 

Côté Gold

  • As of December 31, 2023, construction progress at Côté Gold was estimated to be 98% complete, while overall project progress was approximately 95.5% complete which includes demobilization of construction teams and facilities.
  • On a 100% basis at the UJV level, the Côté Gold Project incurred project expenditures1 of $242.9 million ($170.5 million at 70%) in the fourth quarter 2023 and $1,074.2 million ($752.3 million at 70%) for the full year.
  • Since commencement of construction, $2.786 billion ($1.95 billion at 70%) of project expenditures has been incurred. The estimated remaining project expenditures, on a 100% basis, to achieve first gold is $179.0 million (± 5%) bringing total project expenditures up to first gold in line with the planned $2.965 billion ($2.08 billion at 70%) on an incurred basis. Post first gold, completion of certain infrastructure and earthworks projects are estimated to $40 million (± 5%).
  • In addition to the project expenditures, an estimated $40 million (± 5%) of operating expenditures related to milling and surface costs are expected to be capitalized during commissioning and ramp-up until the project achieves commercial production.
  • Production at Côté Gold, on a 100% basis, is expected to be between 220,000 and 290,000 ounces for the year. This estimate assumes that following initial gold production by the end of March, operations ramp-up in the second quarter 2024 and commercial production is achieved in the third quarter 2024. The Company expects Côté Gold operations to exit the year at a throughput rate of approximately 90% of nameplate.
  • As Côté Gold achieves 90% of throughput, which is expected by the end of the year, the Company estimates cash costs at that time to be in the range of approximately $700 to $800 per ounce sold and AISC of $1,100 to $1,200 per ounce sold.
  • The estimated capital expenditures related to operations for 2024, excluding capital waste stripping, total $145 million (± 5%). Capitalized waste stripping is estimated to be $50 million (± 5%) for the year.
  • IAMGOLD will continue to fund 60.3% of the operating costs and capital expenditures and will receive 60.3% of the gold production.

 

Outlook – Essakane and Westwood

  • Consolidated 2024 attributable gold production for Essakane and Westwood is expected to be in the range of 430,000 to 490,000 ounces, with Essakane attributable gold production expected to be in the range of 330,000 to 370,000 ounces and Westwood gold production expected to be in the range of 100,000 to 120,000 ounces.
  • Cash costs, excluding Côté Gold, are expected to be between $1,280 and $1,400 per ounce sold, and AISC per ounce sold, excluding Côté Gold, is expected to be in the range of $1,780 to $1,940 per ounce sold.

 

Mineral Reserves and Resources

  • Subsequent to quarter end, on February 15, 2024, the Company announced its updated Mineral Reserves and Mineral Resources statement as at December 31, 2023.
  • Proven and Probable Mineral Reserves (100% basis) of current assets increased 12% to 11 million ounces of gold in 302 Mt at 1.14 g/t Au (7.8 million ounces attributable).
  • Measured and Indicated Mineral Resources (100% basis) of current assets increased 16% to 25.9 million ounces of gold in 811.7 Mt at 0.99 g/t Au (18.3 million ounces attributable).
  • Updated Gosselin Mineral Resource estimate (100% basis) of 4.4 million Indicated gold ounces in 161.3 million tonnes at 0.85 grams per tonne gold, and 3.0 million Inferred ounces (123.9 Mt at 0.75 g/t Au). This represents an estimated increase of 1.1 million ounces in Indicated and 1.3 million ounces in Inferred, representing a 32% and 74% increase respectively.

 

Corporate

  • Subsequent to quarter end, on February 15, 2024, the Company announced that Murray Suey has been appointed to the Company’s board of directors effective immediately. Mr. Suey has also been appointed as the Chair of the Audit and Finance Committee.
  • On December 18, 2023, the Company announced that it entered into a forward gold sale arrangement and a partial amendment to one of its existing gold prepay arrangements. The net result of these arrangements is the effective transition of current gold delivery obligations out of the first quarter of 2024 into the following year, increasing cashflow in the first quarter 2024 by approximately $72.5 million assuming current gold prices.
  • On November 9, 2023, the Company entered into a one year extension of its Credit Facility extending its maturity to January 31, 2026. As part of the extension, the Credit Facility was reduced to $425 million based on the Company’s requirements for a senior revolving facility for its overall business.
  • On November 9, 2023, the Company announced the retirement of Ian Ashby from the board of directors and the appointment of Anne Marie Toutant as an independent director.
  • On September 21, 2023, the Company announced the retirement of Maryse Bélanger from the board of directors for personal reasons and other commitments. Immediately following Ms. Bélanger’s retirement, the board appointed David Smith as Chair of the Board.

 

QUARTERLY REVIEW

 

The following table summarizes certain operating and financial results for the three months ended December 31, 2023 (Q4 2023) and December 31, 2022 (Q4 2022) and the years ended December 31 for 2023, 2022 and 2021 and certain measures of the Company’s financial position as at December 31, 2023, December 31, 2022, and December 31, 2021. Financial results of Rosebel include the one month period ended January 31, 2023, prior to the closing of the sale to Zijin Mining Group Co. Ltd. that was announced on October 18, 2022.

 

 

Q4 2023 Q4 2022 2023 2022 2021
Key Operating Statistics
Gold production – attributable (000s oz)
– Essakane 108 98 372 432 412
– Westwood 28 18 93 67 35
Total from continuing operations 136 116 465 499 447
– Rosebel 69 25 214 154
Total gold production – attributable (000s oz) 136 185 490 713 601
Gold sales – attributable (000s oz)
– Essakane 107 97 372 440 408
– Westwood 29 18 90 66 34
Total from continuing operations 136 115 462 506 442
– Rosebel 68 24 215 148
Total gold sales – attributable (000s oz) 136 183 486 721 590
Cost of sales1 ($/oz sold) – attributable
– Essakane $ 1,134 $ 958 $ 1,216 $ 882 $ 1,042
– Westwood 1,446 2,230 1,600 2,093 2,252
Total from continuing operations $ 1,201 $ 1,157 $ 1,291 $ 1,041 $ 1,135
– Rosebel 1,085 949 1,269 1,674
Total cost of sales1 ($/oz sold) – attributable $ 1,201 $ 1,130 $ 1,274 $ 1,109 $ 1,270
Cash costs2 ($/oz sold) – attributable          
– Essakane $ 1,132 $ 1,043 $ 1,181 $ 899 $ 945
– Westwood 1,434 2,210 1,591 2,068 2,240
Total from continuing operations $ 1,197 $ 1,226 $ 1,261 $ 1,052 $ 1,045
– Rosebel 1,083 949 1,243 1,545
Total cash costs2 ($/oz sold) – attributable $ 1,197 $ 1,173 $ 1,246 $ 1,109 $ 1,170
AISC2 ($/oz sold) – attributable          
– Essakane $ 1,548 $ 1,456 $ 1,521 $ 1,234 $ 1,074
– Westwood 2,049 2,639 2,344 2,568 2,600
Total from continuing operations $ 1,735 $ 1,741 $ 1,783 $ 1,508 $ 1,281
– Rosebel 1,554 1,358 1,753 1,859
Total AISC2 ($/oz sold) – attributable $ 1,735 $ 1,672 $ 1,762 $ 1,581 $ 1,426
Average realized gold price2 ($/oz)          
– Continuing operations $ 2,005 $ 1,639 $ 1,955 $ 1,721 $ 1,793
– Discontinued operations 1,725 1,905 1,793 1,777
Total average realized gold price2 ($/oz) $ 2,005 $ 1,670 $ 1,953 $ 1,741 $ 1,790

 

  1. Throughout this MD&A, cost of sales, excluding depreciation, is disclosed in the cost of sales note in the consolidated financial statements.
  2. Refer to the “Non-GAAP Financial Measures” disclosure at the end of this MD&A for a description and calculation of these measures.

 

 

Q4 2023 Q4 2022 2023 2022 2021
Financial Results ($ millions from continuing operations)
Revenues $ 297.6 $ 207.2 $ 987.1 $ 958.8 $ 875.5
Gross profit $ 49.8 $ 20.0 $ 124.1 $ 147.9 $ 62.2
EBITDA1 $ 70.2 $ 105.4 $ 381.0 $ 300.4 $ 27.1
– Continuing operations $ 70.2 $ 57.8 $ 366.6 $ 292.3 $ 216.6
– Discontinued operations $ $ 47.6 $ 14.4 $ 8.1 $ (189.5 )
Adjusted EBITDA1 $ 110.6 $ 83.6 $ 338.5 $ 434.0 $ 355.7
– Continuing operations $ 110.6 $ 38.9 $ 315.1 $ 313.4 $ 307.0
– Discontinued operations $ $ 44.7 $ 23.4 $ 120.6 $ 48.7
Net earnings (loss) attributable to equity holders $ (9.4 ) $ 24.0 $ 94.3 $ (70.1 ) $ (254.4 )
– Continuing operations $ (9.4 ) $ (3.8 ) $ 88.7 $ (55.5 ) $ (95.8 )
– Discontinued operations $ $ 27.8 $ $ (14.6 ) $ (158.6 )
Adjusted net earnings (loss) attributable to equity holders1 $ 26.8 $ 16.6 $ 59.3 $ 22.7 $ 26.8
– Continuing operations $ 26.8 $ (9.0 ) $ 44.7 $ (35.6 ) $ 25.0
– Discontinued operations $ $ 25.6 $ 14.6 $ 58.3 $ 1.8
Net earnings (loss) per share attributable to equity holders – continuing operations $ (0.02 ) $ (0.01 ) $ 0.18 $ (0.12 ) $ (0.20 )
Adjusted net earnings (loss) per share attributable to equity holders1 – continuing operations $ 0.06 $ (0.02 ) $ 0.09 $ (0.07 ) $ 0.05
Net cash from operating activities before changes in working capital1 – continuing operations $ 52.1 $ 36.2 $ 158.9 $ 298.2 $ 256.0
Net cash from operating activities $ 69.9 $ 66.8 $ 159.4 $ 408.7 $ 285.0
– Continuing operations $ 69.9 $ 12.3 $ 144.0 $ 257.6 $ 257.8
– Discontinued operations $ $ 54.5 $ 15.4 $ 151.1 $ 27.2
Mine-site free cash flow1 $ 28.9 $ 0.2 $ 54.1 $ 187.6 $ 128.3
– Continuing operations $ 28.9 $ (21.9 ) $ 48.2 $ 167.2 $ 199.6
– Discontinued operations $ $ 22.1 $ 5.9 $ 20.4 $ (71.3 )
Capital expenditures1,2 – sustaining $ 68.6 $ 50.6 $ 200.3 $ 190.4 $ 63.2
Capital expenditures1,2 – expansion $ 194.0 $ 135.5 $ 733.9 $ 540.3 $ 430.3
Dec 31 Dec 31 Dec 31 Dec 31 Dec 31
2023 2022 2023 2022 2021
Financial Position ($ millions)          
Cash and cash equivalents $ 367.2 $ 407.8 $ 367.1 $ 407.8 $ 552.5
Long-term debt $ 830.8 $ 918.7 $ 830.8 $ 918.7 $ 464.4
Net cash (debt)1 $ (649.5 ) $ (605.6 ) $ (649.5 ) $ (605.6 ) $ 16.3
Available Credit Facility $ 387.0 $ 26.6 $ 387.0 $ 26.6 $ 498.3

 

  1. Refer to the “Non-GAAP Financial Measures” disclosure at the end of this MD&A for a description and calculation of these measures.
  2. Capital expenditures represent incurred expenditures for property, plant and equipment and exploration and evaluation assets, and exclude right-of-use assets.

 

OUTLOOK

 

Côté Gold (100% basis)

 

Production

 

Production at Côté Gold is expected to be between 220,000 and 290,000 ounces for the year. This estimate assumes that following initial gold production, operations ramp-up early in the second quarter 2024 and commercial production is achieved in the third quarter 2024. The Company defines commercial production as an average throughput of the mill of 60% over a period of 30 days. The Company expects Côté Gold operations to exit the year at a throughput rate of approximately 90% of nameplate.

 

Costs

 

During the ramp up period and prior to achieving near nameplate production rates, operating and capitalized waste stripping unit costs are expected to be higher than the expected life of mine average as outlined in the existing 43-101 technical report (dated August 12, 2022) as fixed costs are absorbed by lower volumes, increases in certain cost inputs from the impact of inflation since completion of the technical report, and higher royalty costs due to higher gold prices. As Côté Gold achieves 90% throughput, which is expected by the end of the year, the Company estimates cash costs at that time to be in the range of approximately $700 to $800 per ounce sold and AISC of $1,100 to $1,200 per ounce sold. For accounting purposes, revenue and cost of sales will be recognized from the commencement of production.

 

Capital Expenditures

 

The estimated remaining project expenditures to achieve first gold is $179.0 (± 5%) bringing the total project expenditures up to first gold to $2.965 billion on an incurred basis. Post first gold, completion of certain infrastructure and earthworks projects are estimated to be $40 million (± 5%).

 

In addition to the project expenditures, an estimated $40.0 million (± 5%) of operating expenditures related to milling and surface costs are expected to be capitalized during commissioning and ramp until the project achieves commercial production.

 

The estimated capital expenditures related to operations for 2024, excluding capital waste stripping, total $145 million (± 5%). These expenditures will be incurred from January to December and include:

  • $60 million (± 5%) for the expansion of the tailings management facility as part of phase 2.
  • $50 million (± 5%) for equipment purchases that includes four additional haulage trucks, drills and other mobile equipment.
  • $35 million (± 5%) for capital projects that includes owners’ costs.

 

Capitalized waste stripping is estimated to be $50 million (± 5%) for the year.

 

Côté Gold’s capital expenditures in 2024 are expected to be higher than the life-of-mine average as the mine progresses the completion of the construction of the full tailings dam footprint to support the life of mine. The classification of capital expenditures as either sustaining or expansion during 2024 will be dependent on the timing of achieving first gold and the nature of the expenditure.

 

The Company will continue to fund 60.3% of the operating costs and capital expenditures and will receive 60.3% of the gold production.

 

Essakane and Westwood

 

Actual 2023 Full Year Guidance 20241
Essakane (000s oz) 372 330 – 370
Westwood (000s oz) 93 100 – 120
Total attributable production (000s oz)2 465 430 – 490
Cost of sales2 ($/oz sold) $ 1,291 $ 1,280 – $1,400
Cash costs2,3 ($/oz sold) $ 1,261 $ 1,280 – $1,400
AISC2,3 ($/oz sold) $ 1,783 $ 1,780 – $1,940
Depreciation expense ($ millions) $ 216.0 $ 270 – $285
Income taxes4 paid ($ millions) $ 82.3 $ 45 – $55

 

  1. The full year guidance is based on the following 2024 full year assumptions, before the impact of hedging: average realized gold price of $1,900 per ounce, USDCAD exchange rate of 1.32, EURUSD exchange rate of 1.10 and average crude oil price of $83 per barrel.
  2. Consists of Essakane and Westwood on an attributable basis of 90% and 100%, respectively.
  3. This is a non-GAAP financial measure. See “Non-GAAP Financial Measures”.
  4. The income taxes paid guidance does not include the cash tax obligation arising as part of the Bambouk sales process. See “West Africa – Bambouk assets” for additional details.

 

Production Outlook

 

Attributable gold production, excluding Côté Gold, for 2024 is expected to be in the range of 430,000 to 490,000 ounces:

  • Essakane attributable gold production is expected to be in the range of 330,000 to 370,000 ounces. Production is expected to remain relatively stable throughout the year with mill throughput expected to operate at nameplate capacity and head grades are expected to decrease compared to the prior year as the mill feed is supplemented with stockpiled ore to sustain throughput rates as mining continues through Phase 5 and Phase 6 and into the initial benches of Phase 7.
  • Westwood gold production is expected to be in the range of 100,000 to 120,000 ounces in 2024, with an increasing proportion of underground material milled as the underground mine continues to access higher grade areas. Production levels are expected to be higher in the first half of 2024 due to mine sequencing in the underground mine and as supplementary mill feed from the Fayolle open pit is replaced with lower grade material from Grand Duc in the second half of the year.

 

Costs Outlook

 

Consolidated cash costs per ounce sold for Essakane and Westwood are estimated to be between $1,280 and $1,400 per ounce sold and AISC estimated to be in the range of $1,780 to $1,940 per ounce sold. Unit costs at Westwood are expected to decrease from 2023 levels due to increasing production levels, a planned reduction in rehabilitation costs in the underground mine, and lower development expenses at the short life Fayolle satellite deposit. This is expected to be offset by an increase in unit costs at Essakane due to higher planned maintenance activities, the continued pressures on the landed cost of fuel at the operation, and the application of increased royalty rates announced by the Burkina Faso government in the fourth quarter 2023, while production levels are expected to remain the same with an increase in mill throughput offset by a slightly lower grade mill feed.

 

While inflationary pressures are easing, pricing for certain main consumables including cyanide and explosives are expected to remain in line with the levels of 2023, while the price of certain other consumables such as grinding media are expected to decrease.

 

Capital Expenditures

 

Sustaining capital expenditures¹ for 2024 are expected to be approximately $215 million (± 5%) of which the majority is related to capitalized stripping at Essakane and underground development at Westwood, with an additional $5 million (± 5%) in expansion capital¹ expected at Essakane.

 

Actual 20231 Full Year Guidance 20242
($ millions) Sustaining3 Expansion Total Sustaining3 Expansion Total
Essakane (±5%) $ 134.9 $ 1.7 $ 136.6 $ 150 $ 5 $ 155
Westwood (±5%) 65.0 0.6 65.6 65 65
$ 199.9 $ 2.3 $ 202.2 215 5 220
Corporate 0.4 0.4
Total4 $ 200.3 $ 2.3 $ 202.6 $ 215 $ 5 $ 220

 

  1. 100% basis, unless otherwise stated.
  2. Capital expenditures guidance (±5%) at Essakane and Westwood.
  3. Sustaining capital includes capitalized stripping of (i) $32.3 million for Essakane and $1.7 million for Westwood in the fourth quarter 2023, (ii) $73.8 million for Essakane and $5.8 million for Westwood for 2023, and (iii) $100 million for Essakane and $4 million for Westwood for the full year guidance. See “Outlook” sections below.
  4. Includes $3 million of capitalized exploration and evaluation expenditures also included in the Exploration Outlook guidance table.

 

Exploration Outlook

 

Exploration expenditures for 2024 are expected to be approximately $20 million, including $5 million on the Gosselin resource delineation drilling program, as well as other near-mine and greenfield programs.

 

Actual 2023 Full Year Guidance 20241
($ millions) Capitalized Expensed Total Capitalized Expensed Total
Exploration projects – greenfield $ $ 11.0 $ 11.0 $ $ 15 $ 15
Exploration projects – brownfield1 4.4 1.9 6.3 3 2 5
$ 4.4 $ 12.9 $ 17.3 $ 3 $ 17 $ 20

 

  1. The full year guidance does not include expenditures for the Bambouk Assets sales currently held for sale. See “West Africa – Bambouk Assets” for additional details.

 

ENVIRONMENTAL, SOCIAL AND GOVERNANCE

 

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, contractors and consultants first.

 

The Company issued its 16th annual Sustainability Report on October 16, 2023, highlighting progress and achievements in 2022 across a range of material topics and indicators. ESG policies, systems and practices are embedded throughout the business and the Company reports annually on its ESG performance via its Global Reporting Initiative and Sustainability Accounting Standards Board aligned Sustainability Report. The Company has also released its inaugural Climate Action Report in accordance with the Task Force on Climate-Related Financial Disclosures recommendations on December 14, 2023. The Climate Action Report focuses on the Company’s target of achieving a 30% absolute reduction in Scopes 1 and 2 greenhouse gas emissions by 2030.

 

Health and Safety

Health and safety are core to the Company’s relentless pursuit of its Zero Harm® vision. Through various prevention programs, the Company continuously promotes a safe work environment and a wellness program at all sites. The DARTFR (days away, restricted, transferred duty frequency rate) was 0.39 as of the end of 2023 (compared to 0.31 as of the end of 2022). The TRIFR (total recordable injuries frequency rate) was 0.69 as of the end of 2023 (compared to 0.76 as of the end of 2022). At Côté Gold, total project hours worked reached 14.8 million hours with a LTIFR (lost time injury frequency rate) of 0.12.

 

The Essakane team achieved historical Health & Safety performance in 2023, with a level of 0.06 for DARTFR and 0.18 for TRIFR. The results, which matched (TRIFR) and surpassed (LTIFR) the site’s best-ever results, were supported by exceptional performance of proactive or ‘leading’ H&S activities such as safety and management inspections.

 

Environment

 

At Essakane, progress continued on Falagountou’s Closure Plan, including collaborative work with INERA (Institute of Environment and Agricultural Research) on the best practice phytoremediation of the closed mine site. Essakane conducted a quarterly review of the Asset Retirement Obligation with the corporate team and is also working on a water management study as part of the Essakane Closure Plan.

 

The 2021 Closure Plan update at Westwood was reviewed by the Quebec Ministry of Natural Resources and Forestry and IAMGOLD submitted an amended Closure Plan on September 8, 2023, following this review process. Water recycling projects have been initiated to reduce water withdrawal from the Bousquet River. Westwood is continuing to implement a biodiversity project to develop snake hibernacula and swallows’ nests.​

 

At Côté Gold, biodiversity monitoring studies were completed for birds and bats. At Mattagami Lake, a fish population study was also conducted as part of the Project’s Fisheries Offsetting Plan. The first cycle of environmental effects monitoring was completed per the Metal and Diamond Mining Effluent Regulations.

 

Social and Economic Development

 

The Company is continuously exploring opportunities for investing in and partnering with the communities impacted by its continuing operations.

 

At Essakane, the Company continued its participation in the Mining Fund for Local Development in Burkina Faso, a program established by the government, pursuant to which the Company committed to contribute 1% of its annual revenues. To support local communities in the fight against the latest Dengue fever outbreak, the Company supported the distribution of test kits and supplies to surrounding medical clinics. In December, Essakane provided donated food kits to 1,000 vulnerable households in the Essakane mine impact zone. The Company also invested in several agricultural projects during the quarter in the communes of Falagountou and Gorom-Gorom.

 

At Côté Gold, various meetings were held in support of Impact Benefit Agreement (“IBA”) implementation with First Nation Partners (“FNP”) Mattagami and Flying Post and the Métis Nation of Ontario, Region 3. Côté Gold supported several events and initiatives during the quarter through community investments, donations, and sponsorships.

 

The Westwood team supported seven community initiatives during the quarter. This included support for lodging for people attending cancer treatments, scholarships for CEGEP Abitibi and UQAT, as well as support for various cultural and sporting events.

 

Equity, Diversity and Inclusion

 

The Company unequivocally condemns inequity, discrimination and hatred in all its forms. One of the Company’s values is to conduct itself with respect and to embrace diversity. The Company has established an Equity, Diversity and Inclusion (“EDI”) Steering Committee to further enhance the Company’s strong commitment to these important values through data collection, education, awareness and action planning at the enterprise level. The Company completed a diagnostic evaluation of its EDI status, and the findings and recommendations (global and site specific) were rolled out across the Company to develop action plans. The Company is a sponsor of various initiatives aimed at promoting female business owners and entrepreneurs in the mining sector, in addition to hiring under-represented groups within IAMGOLD. The Company is also an active contributor to the Mining Association of Canada’s TSM protocol on EDI and is working closely with Mining HR Canada on various initiatives, including with the representation of a member of management as Chair of the “Safe Workplaces for All” council.

 

In addition, IAMGOLD was recognized as a GTA Top 100 Employer for its efforts on various inclusion, engagement and culture work.

 

Governance

 

The Board of Directors of IAMGOLD adopted new diversity and renewal guidelines in 2021, reflecting governance best practices. Regarding diversity, the Board agreed that its membership should comprise, at a minimum, the greater of (i) two and (ii) 30% female directors. Highlights from the fourth quarter include:

  • On November 9, 2023, the Company announced the retirement of Ian Ashby from the Board and the appointment of Anne Marie Toutant as an independent director.
  • On December 31, 2023, Craig MacDougall, Executive Vice President Growth and Oumar Toguyeni, Senior Vice President External Affairs and Sustainability, retired from their positions at the Corporation.
  • On February 15, 2024, the Company announced that Murray Suey has been appointed to the Company’s board of directors effective immediately. Mr. Suey has also been appointed as the Chair of the Audit and Finance Committee.

 

Currently, women represent 44% of the directors and 50% of the independent directors. The average tenure of directors on the Board is less than two years.

 

OPERATIONS – CONTINUING

 

Essakane Mine (IAMGOLD interest – 90%)1 | Burkina Faso

 

Q4 2023 Q4 2022 2023 2022 2021
Key Operating Statistics1
Ore mined (000s t) 3,217 1,691 9,586 12,585 16,015
Grade mined (g/t) 1.42 1.70 1.35 1.20 0.91
Waste mined (000s t) 9,693 8,795 33,763 37,100 44,405
Material mined (000s t) – total 12,910 10,486 43,349 49,685 60,420
Strip ratio2 3.0 5.2 3.5 2.9 2.8
Ore milled (000s t) 3,116 2,788 11,283 11,632 12,948
Head grade (g/t) 1.32 1.35 1.26 1.44 1.31
Recovery (%) 91 89 90 89 84
Gold production (000s oz) – 100% 120 108 413 480 457
Gold production (000s oz) – attributable 90% 108 98 372 432 412
Gold sales (000s oz) – 100% 118 108 413 489 453
Average realized gold price3 ($/oz) $ 2,009 $ 1,702 $ 1,957 $ 1,804 $ 1,794
Financial Results ($ millions)1          
Revenues4 $ 238.3 $ 184.1 $ 809.6 $ 883.3 $ 813.9
Cost of sales4 134.3 103.4 502.4 431.2 472.1
Production costs 112.2 94.9 458.6 382.6 433.1
(Increase)/decrease in finished goods 6.3 (1.0 ) (0.8 ) 4.8 (1.7 )
Royalties 15.8 9.5 44.6 43.8 40.7
Cash costs3 134.1 112.7 488.0 439.5 $ 428.3
Sustaining capital expenditures3 51.7 42.4 134.9 158.8 51.2
Expansion capital expenditures3 0.3 1.3 1.7 3.8 84.4
Total capital expenditures 52.0 43.7 136.6 162.6 135.6
Earnings from operations 14.3 29.0 92.0 219.5 83.4
Performance Measures5          
Cost of sales excluding depreciation ($/oz sold) $ 1,134 $ 958 $ 1,216 $ 882 $ 1,042
Cash costs3 ($/oz sold) $ 1,132 $ 1,043 $ 1,181 $ 899 $ 945
AISC3 ($/oz sold) $ 1,548 $ 1,456 $ 1,521 $ 1,234 $ 1,074

 

  1. 100% basis, unless otherwise stated.
  2. Strip ratio is calculated as waste mined divided by ore mined.
  3. This is a non-GAAP financial measure. See “Non-GAAP Financial Measures”.
  4. As per note 36 of the consolidated financial statements for revenues and cost of sales. Cost of sales is net of depreciation expense.
  5. Cost of sales, cash costs and AISC per ounce sold may not be calculated based on amounts presented in this table due to rounding.

 

Operations

 

Essakane delivered its highest quarterly production for the year with 108,000 attributable ounces produced in the fourth quarter, finishing the year with 372,000 attributable ounces produced, at the upper end of the guidance range of 340,000 to 380,000 ounces. For the quarter, this is an increase of 10,000 ounces or 10% from the same prior year period, primarily due to increased throughput, benefiting from improvements to increase throughput capacity at the mill. For the year, this is a decrease of 60,000 attributable ounces or 14% from the record levels achieved in 2022, primarily due to lower grades in accordance with the planned mill throughput.

 

Mining activity of 12.9 million tonnes in the fourth quarter 2023 was higher by 2.4 million tonnes or 23% compared to the same prior year period, resulting in mining activity of 43.3 million tonnes for the year, 6.3 million tonnes or 13% lower than the prior year. The lower mining activity for the year is due to periodic operational interruptions experienced in the first and third quarters due to supply chain constraints related to the security environment in the country, which began in the fourth quarter 2022. During the fourth quarter 2023, the supply chain constraints lessened allowing the mining fleet to operate at full capacity, including mining the deeper benches of Phase 5 and the resumption of stripping activities in Phases 6 and 7 in support of the 2024 and 2025 ore supply. At quarter end, sufficient fuel and other consumables were on hand to ensure normal operating levels for a minimum of 50 days.

 

Mill throughput in the fourth quarter 2023 was 3.1 million tonnes at an average head grade of 1.32 g/t, 12% higher and 2% lower than the same prior year period, respectively. For the full year, mill throughput was 11.3 million tonnes at an average head grade of 1.26 g/t, 3% and 13% lower than the prior year, respectively. During the quarter, the increase in throughput was partially due to the successful implementation and ramp-up of the MP 1250 crusher that was installed in anticipation of processing of higher proportions of hard rock as the pit deepens. The decrease in head grade for the quarter and the year is due to higher proportions of stockpiled ore milled in accordance with the mine plan, compared to the same prior year periods.

 

The mill achieved recoveries of 91% in the fourth quarter 2023, 2% higher than the same prior year period, benefiting from the successful installation and commissioning of three new screens in the gravity circuit. Plant availability in the quarter was higher in the current year period at 94.8% compared to 88.6% in the prior year period.

 

The security situation in Burkina Faso continues to be a focus for the Company. Terrorist-related incidents are still occurring in the country, the immediate region of the Essakane mine and, more broadly, the West African region. The security situation in Burkina Faso and its neighbouring countries continues to apply pressures to supply chains, although with a reduced impact in the fourth quarter 2023. The Company continues to take proactive measures to ensure the safety and security of in-country personnel and is constantly adjusting its protocols and the activity levels at the site according to the security environment. The Company continues to invest in the security and supply chain infrastructure in the region and at the mine site. It is also incurring additional costs to bring employees, contractors, supplies and inventory to the mine.

 

The Company announced that the Essakane Proven and Probable Mineral Reserves, on a 100% basis, increased an estimated 7% from the prior year to 2.2 million ounces (2.0 million ounces attributable) at an average grade of 1.10 g/t Au. Probable Mineral Reserves (open pit) were estimated, on a 100% basis, at 1.8 million ounces (1.6 million ounces attributable) at an average grade of 1.32 g/t Au. (see news release dated February 15, 2024).

 

On October 27, 2023, the President of Burkina Faso signed a decree resulting in an increase to royalty rates on gold sales occurring at prices above $1,500 per ounce. The decree increases the royalty from the previous rate of 5% on all gold sold over $1,500 per ounce to new rates applied at 6% on gold sold between $1,500 and $1,700 per ounce, 6.5% on gold sold between $1,700 and $2,000 per ounce, and 7% for gold sold exceeding $2,000 per ounce.

 

In 2018, the Attorney General of Burkina Faso initiated proceedings against Essakane S.A. and certain of its employees relating to its practice at that time of exporting carbon fines containing gold and silver from Burkina Faso to a third-party facility in Canada for processing and eventual sale. This matter proceeded to trial and a settlement agreement was ultimately entered into by the parties, as Essakane S.A. determined it to be in the best interest of stakeholders to settle the proceedings acknowledging immaterial regulatory violations. The settlement consideration agreed to with the Government of Burkina Faso to fully and finally resolve the proceedings consisted of a forfeiture, direct to the State, of the embargoed carbon fines shipment and an additional monetary penalty of $15 million paid directly to the State.

 

Financial Performance

 

Production costs of $112.2 million were higher by $17.3 million or 18% primarily due to increased mining and milling activity as the operation was able to operate at full capacity during the fourth quarter 2023, compared to the fourth quarter 2022 which was impacted by the supply chain constraints as described above. Cost pressures as a result of the security situation and inflation continued during the quarter, resulting in higher landed fuel and other key consumable prices, transportation and camp costs.

 

Cost of sales, excluding depreciation, of $134.3 million was higher by $30.9 million or 30% primarily due to higher production costs described above, an NRV write-up of $9.6 million recorded in the fourth quarter 2022, and increased royalties due to higher gold prices and the new royalty rate structure described above. Cost of sales per ounce sold, excluding depreciation, of $1,134 was higher by $176 or 18% primarily due to the items noted above, partially offset with higher production and sales volumes.

 

Cash costs of $134.1 million were higher by $21.4 million or 19% due to the higher production costs and royalties noted above. Cash costs per ounce sold of $1,132 were higher by $89 or 9%, primarily due to the higher production costs and royalties noted above, partially offset with higher production and sales volumes.

 

AISC per ounce sold of $1,548 was higher by $92 or 6% primarily due to higher cash costs per ounce sold.

 

Total capitalized stripping of $32.3 million was higher by $2.1 million or 7% primarily due to higher mining costs resulting from the increased landed cost of fuel.

 

Sustaining capital expenditures, excluding capitalized stripping, of $19.4 million included capital spares of $6.1 million, mobile and mill equipment of $5.1 million, tailings management of $1.9 million, resource development of $1.2 million, generator overhaul $0.4 million and other sustaining projects of $4.7 million. Expansion capital expenditures of $0.3 million were incurred in support of fulfilling the community village resettlement commitment.

 

2024 Outlook

 

Essakane attributable production is expected to be in the range of 330,000 to 370,000 ounces. The mill is expected to operate at nameplate capacity and head grades are expected to decrease compared to the prior year as the mill feed is supplemented with stockpiled ore to sustain throughput rates as mining continues through Phase 5 and Phase 6 and into the initial benches of Phase 7.

 

Cash costs at Essakane are expected in the range of $1,300 to $1,400 per ounce sold and AISC per ounce sold are expected in the range of $1,675 to $1,800, higher when compared to 2023 costs due to a scheduled increase in planned maintenance activities, continued pressures on the landed cost of fuel at the operation, and the application of increased royalty rates announced by the Burkina Faso government in the fourth quarter 2023. Additionally, as the mine resumes capitalized waste stripping with full mining capacity, the AISC per ounce sold for 2024 is expected to increase in line with the increase in the associated sustaining capital before stripping activities and costs decrease in line with the mine plan from 2025 and 2026 onwards.

 

Capital expenditures are expected to be approximately $155 million, compared to $136.6 million in 2023, and primarily consist of capitalized waste stripping to provide access to ore as per the 2024 and 2025 production plan, assuming no significant disruptions in the supply chain resulting from the security situation described above.

 

Westwood Mine Complex (IAMGOLD interest – 100%) | Quebec, Canada

 

Q4 2023 Q4 2022 2023 2022 2021
Key Operating Statistics
Underground lateral development (metres) 1,263 1,297 5,271 4,303 946
Ore mined (000s t) – underground 77 64 280 241 106
Ore mined (000s t) – other sources 162 216 742 836 919
Ore mined (000s t) – total 239 280 1,022 1,077 1,025
Grade mined (g/t) – underground 7.77 4.76 7.11 5.47 4.67
Grade mined (g/t) – other sources 2.33 1.17 1.71 1.04 0.83
Grade mined (g/t) – total 4.08 2.00 3.19 2.03 1.23
Ore milled (000s t) 245 300 1,034 1,118 965
Head grade (g/t) – underground 7.92 4.69 7.12 5.42 4.46
Head grade (g/t) – other sources 2.02 1.22 1.51 1.05 0.85
Head grade (g/t) – total 3.90 1.94 3.03 1.99 1.24
Recovery (%) 94 93 93 93 92
Gold production (000s oz) 28 18 93 67 35
Gold sales (000s oz) 29 18 90 66 34
Average realized gold price1 ($/oz) $ 1,989 $ 1,718 $ 1,946 $ 1,788 $ 1,789
Financial Results ($ millions)          
Revenues2 $ 58.6 $ 31.3 $ 176.6 $ 120.6 $ 61.6
Cost of sales2 42.4 40.1 144.6 139.2 $ 77.0
Production costs 39.3 41.3 148.5 145.5 86.8
(Increase)/decrease in finished goods 2.9 (1.2 ) (4.1 ) (6.3 ) (9.8 )
Royalties 0.2 0.2 $
Cash costs1 41.9 39.8 143.7 137.5 $ 76.6
Sustaining capital expenditures1 16.8 7.8 65.0 30.3 11.4
Expansion capital expenditures1 0.4 2.1 0.6 4.8 $ 2.9
Total capital expenditures 17.2 9.9 65.6 35.1 14.3
Earnings/(loss) from operations (2.4 ) (19.1 ) (9.7 ) (41.4 ) (93.9 )
Performance Measures3          
Cost of sales excluding depreciation4 ($/oz sold) $ 1,446 $ 2,230 $ 1,600 $ 2,093 $ 2,252
Cash costs1 ($/oz sold) $ 1,434 $ 2,210 $ 1,591 $ 2,068 $ 2,240
AISC1 ($/oz sold) $ 2,049 $ 2,639 $ 2,344 $ 2,568 $ 2,600

 

  1. This is a non-GAAP financial measure. See “Non-GAAP Financial Measures”.
  2. As per note 36 of the consolidated financial statements for revenues and cost of sales. Cost of sales is net of depreciation expense.
  3. Cost of sales, cash costs and AISC per ounce sold may not be calculated based on amounts presented in this table due to rounding.
  4. Includes non-cash ore stockpile and finished goods inventories NRV write-down of $nil for the fourth quarter 2023 (fourth quarter 2022 – $2.3 million) and $3.2 million for 2023 (2022 – $8.4 million, 2021 – $9.9 million), which had an impact on cost of sales, excluding depreciation, per ounce sold of $nil for the fourth quarter 2023 (fourth quarter 2022 – $125) and $36 for 2023 (2022 – $126, 2021 – $289).

 

Operations

 

Westwood delivered its highest quarterly production since the underground mine restarted in 2021, with 28,000 ounces produced, finishing the year with 93,000 ounces produced, exceeding the top end of the guidance range of 90,000 ounces. This is an increase of 10,000 ounces or 56% and 26,000 ounces or 39% for the quarter and year, respectively, compared with the same prior year periods. The higher production is the result of the underground mine ramp-up, supplying increased volumes of higher grade ore for the mill feed, and the introduction of higher grade material from the Fayolle deposit.

 

Mining activity of 239,000 tonnes of ore in the fourth quarter 2023 was lower by 41,000 tonnes or 15% from the same prior year period, resulting in mining activity of 1,022,000 tonnes of ore for the year, 55,000 tonnes or 5% lower than the prior year. The decrease in mining activity results from lower ore volumes from the Grand Duc open pit, partially offset with the introduction of material from the Fayolle deposit and an increase in ore volumes from the underground mine at higher grades, following extensive progress on the underground rehabilitation and development program.

 

Lateral underground development of 1,263 metres in the fourth quarter 2023 was in line with the same prior year period, resulting in 5,271 metres for the year, 968 metres or 22% higher than the prior year. The mining team continued to execute the underground rehabilitation and development work program, providing increased operational flexibility with multiple stope sequences now available to mine concurrently.

 

The rehabilitation work program consists of repairing and upgrading the existing underground infrastructure in line with the revised rock mechanic standard, which has been developed to ensure that safe work conditions are maintained in seismic portions of the mine. This activity enables production to safely recommence once rehabilitation work on a specific level has been completed. The rehabilitation work program is expected to be completed in 2024.

 

Mill throughput in the fourth quarter 2023 was 245,000 tonnes at an average head grade of 3.90 g/t, 18% lower and double the same prior year period, respectively. For the full year, mill throughput was 1,034,000 tonnes at an average head grade of 3.03 g/t, 8% lower and 52% higher than the prior year. The lower volumes at higher head grades are due to an increased proportion of higher grade ore feed from the underground mine, as production activities were able to target rehabilitated underground zones, and the introduction of higher grade material from Fayolle deposit, partially offset by lower volumes from the Grand Duc open pit.

 

The mill achieved recoveries of 94% in the fourth quarter 2023, slightly higher than the same prior year period. There was reduced plant availability in the quarter of 77.9% compared to 95.0% in the prior year period, due to unplanned maintenance on the SAG mill liners and apron feeder. Remediation actions are being undertaken.

 

Westwood Mineral Reserves, including the Grand Duc open pit, increased 109% from 582,000 ounces to 1.2 million ounces, net of depletion, with grades increasing 26% to 7.14 g/t Au. Excluding Grand Duc, underground Mineral Reserves were estimated at 1.1 million ounces at an average grade of 10.6 g/t Au. The increase in Mineral Reserves was driven by the rehabilitation efforts over the course of the year which allowed for the resumption of mining activities in previously closed zones (see news release dated February 15, 2024).

 

Financial Performance

 

Production costs of $39.3 million was lower by $2.0 million or 5% than the same prior year period due to lower mining costs and an NRV write-down of $2.3 million recorded in the fourth quarter 2022, partially offset by $5.6 million of development costs incurred at the Fayolle deposit, which has been expensed due to the short life of the Fayolle Project.

 

Cost of sales, excluding depreciation, of $42.4 million was higher by $2.3 million or 6% due to timing of sales, partially offset by lower production costs. Cost of sales per ounce sold, excluding depreciation, of $1,446, was lower by $784 or 35% primarily due to higher production and sales volumes.

 

Cash costs of $41.9 million were higher by $2.1 million or 5% due to timing of sales, partially offset by lower production costs. Cash costs per ounce sold of $1,434 were lower by $776 or 35%, primarily due to higher production and sales volumes. Included in cash costs per ounce sold is an approximate impact of $190 per ounce sold resulting from the development cost incurred at the Fayolle deposit.

 

AISC per ounce sold of $2,049 was lower by $590 or 22%, primarily due to lower cash costs per ounce sold, partially offset by increased sustaining capital expenditures including non-recurring rehabilitation work performed.

 

Sustaining capital expenditures of $16.8 million included underground development and rehabilitation of $8.5 million, capitalized stripping of $1.6 million and other sustaining capital projects of $6.7 million.

 

2024 Outlook

 

Westwood gold production is expected to be in the range of 100,000 to 120,000 ounces in 2024, with an increasing proportion of ore sourced from the underground mine at higher grades. Production levels are expected to be higher in the first half of 2024 due to mine sequencing in the underground mine and as supplementary mill feed from the higher grade Fayolle open pit is replaced with lower grade material from Grand Duc in the second half of the year.

 

Cash costs at Westwood are expected in the range of $1,250 to $1,375 per ounce sold and AISC per ounce sold are expected in the range of $1,800 to $2,000. Unit costs are expected to decrease from 2023 levels in line with increased production levels, a planned reduction in rehabilitation costs in the underground mine, and lower development expenses at the short life at the Fayolle satellite deposit.

 

Capital expenditures are expected to be approximately $65 million of sustaining capital, in line with $65.6 million in 2023, primarily consisting of $35 million in underground development and rehabilitation, $15 million for the renewal of the mobile fleet and fixed equipment, $5 million for asset integrity projects at the Westwood mill, and $10 million on other capital projects.

 

During the second half of the year, the Company plans to file an updated NI 43-101 compliant technical report detailing the results of certain mine optimization efforts and strategic assessments of the Westwood complex.

 

PROJECTS

 

Côté Gold Project | Ontario, Canada

 

As of December 31, 2023, construction progress at Côté Gold was estimated to be 98% complete; while overall project progress was approximately 95.5% complete which includes demobilization of construction teams and facilities.

 

Fourth Quarter Activities Update

 

The following provides an update on project activities as at the end of the fourth quarter 2024 (unless otherwise noted):

 

Project Activity Update
Health and safety Total project hours worked of 14.8 million hours with a project-to-date DARTFR of 0.13 and a TRIFR of 0.72.
Labour and workforce In the fourth quarter, the project workforce continued to demobilize as project areas were turned over to the operating teams. The ramp-up of the Côté operations workforce continued with 515 roles filled to date and with all senior positions filled. Labour availability and turnover continues to be a primary focus for Côté management.
Construction Earthworks: All major earthwork activities associated with construction essentially complete, including Stage 1 of the Tailings Management Facility (“TMF”).

Processing: Dry side of the processing plant, including primary and secondary crushing and associated screening and conveyors substantially complete. Activities remaining include the continued installation and configuration of remaining piping, electrical and instrumentation primarily within the plant. Re-alignment of the ball mill was completed with support of the OEM for mechanical start-up in February. At the back end, final mechanical completion of the detox and electrowinning circuits is on track to be completed in the first quarter of 2024 to support initial gold pour later in the quarter.

Infrastructure: All required infrastructure nearing completion with good advancement of tertiary mine facilities in the quarter.

Commissioning Commissioning of the first electric shovel was completed in the quarter and deployed for in-pit activities. The second electric shovel is currently being commissioned and expected to be deployed in the first quarter of 2024.

Transfer of care, custody and control of project deliverables progressed well in the quarter with more than 50% of the systems turned over to the commissioning teams.

Subsequent to quarter end, the commissioning of the primary crushing circuit successfully crushed mined rock which was then conveyed to the coarse ore dome. Commissioning of the HPGR to fine ore bin to ball mill circuit is planned for February, followed thereafter by the wet circuits including leaching, cyanide detox and gold room. First gold is planned before the end of Q1 2024.

Operational readiness By the end of the fourth quarter 2023, a total of fourteen haul trucks were commissioned and in operation. Testing of the autonomous drills continued with four Pit Vipers in operation. The operations team are continuously improving haulage roads and dumping location to achieve improved autonomous haulage efficiency and cycle times.

Mining activities have continued to advance well, with a daily record 128,000 tonnes of material moved towards the end of the quarter. The ore stockpile finished the year with 5 million tonnes of ore on the pad in line with the target.

 

 

Project Expenditures1

 

On a 100% basis at the UJV level, the Côté Gold Project incurred project expenditures of $242.9 million ($170.5 million at 70%) in the fourth quarter 2023 at an average USDCAD exchange rate of 1.37 and $1,074.2 million ($752.3 million at 70%) for the year, at an average USDCAD exchange rate of 1.35. Incurred project expenditures include the cost of supplies inventory and the build of the initial ore stockpile. Since commencement of construction, $2.786 billion ($1.95 billion at 70%) of the planned $2.965 billion ($2.08 billion at 70%) of project expenditures has been incurred. The original plan assumed a USDCAD exchange rate of 1.25.

 

The Company funded approximately $173.9 million to the UJV during the quarter and SMM funded $114.5 million, which includes an additional $28.0 million that was funded due to its increased interest.

 

2024 Outlook – 100%

 

Production at Côté Gold is expected to be between 220,000 and 290,000 ounces for the year. This estimate assumes that following initial gold production, operations ramp-up early in the second quarter 2024 and commercial production is achieved in the third quarter 2024. The Company defines commercial production as an average throughput of the mill of 60% over a period of 30 days. The Company expects Côté Gold operations to exit the year at a throughput rate of approximately 90% of nameplate.

 

During the ramp-up period and prior to achieving near nameplate production rates, operating costs are expected to be higher than the expected life of mine average as outlined in the existing 43-101 technical report (dated August 12, 2022) as fixed costs are absorbed by lower volumes, increases in certain cost inputs from the impact of inflation since completion of the technical report, and higher royalty costs due to higher gold prices. As Côté Gold achieves 90% throughput, which is expected by the end of the year, the Company estimates cash costs at that time to be in the range of approximately $700 to $800 per ounce sold and AISC of $1,100 to $1,200 per ounce sold. For accounting purposes, revenue and cost of sales will be recognized from the commencement of production.

 

The total expected remaining project expenditures up to achieving first gold remains at $179.0 million assuming a USDCAD rate of 1.34. Post first gold, completion of certain infrastructure and earthworks projects are estimated to $40 million (± 5%).

 

In addition to the project expenditures, an estimated $40.0 million (± 5%) of operating expenditures related to milling and surface costs are expected to be capitalized during commissioning and ramp until the project achieves commercial production.

 

The estimated capital expenditures related to operations for 2024, excluding capital waste stripping, total $145 million (± 5%). These expenditures will be incurred from January to December and include:

  • $60 million (± 5%) for the expansion of the tailings management facility as part of phase 2.
  • $50 million (± 5%) for equipment purchases that includes four additional haulage trucks, drills and other mobile equipment.
  • $35 million (± 5%) for capital projects that includes owners costs.

 

Capitalized waste stripping is estimated to be $50 million (± 5%) for the year.

 

Côté Gold’s capital expenditures in 2024 are expected to be higher than the life-of-mine average as the mine progresses with the completion of the construction of the full tailings dam footprint. The classification of capital expenditures as either sustaining or expansion during 2024 will be dependent on the timing of achieving first gold and the nature of the expenditure.

 

Based on the Company’s 60.3% interest in the UJV (refer to the MD&A for details on the funding transaction with Sumitomo), IAMGOLD’s remaining funding requirement for project and commissioning expenditures up to first gold, payment of all accounts payable balances related to project expenditures and the remaining lease funding in the first quarter 2024, is expected to be $142.0 million. After achieving first gold, IAMGOLD will continue to fund operating and capital expenditures through cash calls at its 60.3% interest and will receive 60.3% of gold production.

 

Upcoming Milestones and Schedule Summary

 

Côté Gold is expected to commence production towards the end of the first quarter of 2024 ramping up to commercial production in the third quarter 2024. Recently achieved milestones and those remaining of note are as follows:

 

 

The Company cautions that potential further impacts, including, without limitation, inflationary pressures, global supply chain disturbances, disruptions from weather events resulting in limited or no productivity such as extreme cold or forest fires in dry, hot summer months, early-life failure of equipment, labour disputes and the tight labour market could impact the timing of activities, costs, availability of workforce, productivity and supply chain and logistics and, consequently, could further impact the timing of achieving commercial production and, consequently, project costs and/or guidance estimates.

 

Gosselin Deposit

 

The Gosselin deposit is located immediately to the northeast of the Côté Gold deposit. In 2023, the Company drilled approximately 24,600 metres to further delineate and expand the Gosselin mineral resources and test selected targets along an interpreted favourable deposit corridor.

 

On October 23, 2023, the Company reported assay results from the 2023 diamond drill program with highlights including: 300.8 metres grading 1.40 g/t Au in GOS23-134, 240.0 metres grading 1.53 g/t Au in GOS23-136 and 500.8 metres grading 0.72 g/t Au in GOS23-144 (see news release dated October 23, 2023). The favorable results from this phase of drilling provided evidence the Gosselin deposit is approaching similar dimensions as the adjacent Côté deposit. Drill intercepts obtained from the newly discovered West Breccia have significantly expanded this breccia body which now measures 250 metres by 170 metres and extends for a depth of approximately 400 metres. This has helped to highlight a highly prospective corridor at depth measuring up to 850 metres in strike length that remains to be tested between the Gosselin West Breccia and the Côté deposit hydrothermal breccia.

 

These results were incorporated into the deposit model and on February 15th, 2024 the Company reported an updated Mineral Resource Estimate (on a 100% basis) of 161.3 million tonnes of Indicated Mineral Resources averaging 0.85 g/t Au for 4.42 million ounces of gold, and 123.9 million tonnes of Inferred Mineral Resources averaging 0.75 g/t Au for 2.98 million ounces of gold (on a 100% basis) (see news releases dated February 15, 2024).

 

Technical studies are planned to advance metallurgical testing, conduct mining and infrastructure studies in order to review alternatives for potential inclusion of the Gosselin deposit into a future Côté Gold LOM plan.

 

Nelligan Gold Project | Chibougamau District, Quebec, Canada

 

The Nelligan Gold Project is located approximately 45 kilometres south of the Chapais Chibougamau area in Québec.

 

On December 5, 2023, the Company announced it had entered into a definitive arrangement agreement with Vanstar pursuant to which the Company has agreed to acquire all of the issued and outstanding common shares of Vanstar by way of a court-approved plan of arrangement under the Canada Business Corporations Act.

 

Pursuant to the Arrangement Agreement, Vanstar’s shareholders will receive 0.2008 of an IAMGOLD common share for each Vanstar share. Based on the 5-day volume weighted average price of IAMGOLD shares on the TSX as of December 1, 2023, the consideration to Vanstar’s shareholders and option holders implies a total transaction value of approximately $31.1 million (based on the Bank of Canada daily exchange rate as of December 1). The transaction closed on February 13, 2024.

 

Vanstar is a gold exploration company with properties located in Northern Quebec at different stages of development. Vanstar’s primary asset is a 25% interest in Nelligan which is held under an earn-in option to the joint venture agreement with IAMGOLD (IAMGOLD: 75%; Vanstar: 25%). Vanstar also holds a 1% NSR royalty on selected claims of the project that will be cancelled due to the transaction.

 

During 2023, approximately 10,300 metres were drilled at Nelligan towards the goal of improving resource classification and extending mineralization beyond the current resource pit shell of the Nelligan deposit, as well as testing selected exploration targets elsewhere on the property. The results from the second portion of 2023 drill program were reported in the fourth quarter with highlights including: 35.3 metres grading 1.21 g/t Au, 34.4 metres grading 2.55 g/t Au and 28.5 metres grading 1.92 g/t Au, (see Vanstar news release dated December 4, 2023).

 

On February 15, 2024, IAMGOLD reported an updated Mineral Resource Estimate for Nelligan as part of the year end reporting process. The updated Mineral Resource Estimate (on a 100% basis) returned 74.5 million tonnes of Indicated Mineral Resources averaging 0.84 g/t Au for 2.01 million ounces of gold, and 142.6 million tonnes of Inferred Mineral Resources averaging 0.85 g/t Au for 3.89 million ounces of gold (see news releases dated February 15, 2024).

 

Bambouk Assets | West Africa

 

On December 20, 2022, the Company announced it had entered into definitive agreements with Managem S.A (CAS:MNG) to sell its interests in the Bambouk Assets. Under the terms of the agreements, IAMGOLD will receive total cash payments of approximately $282.0 million (pre-tax) as consideration for the shares and subsidiary/intercompany loans for the entities that hold the Company’s 90% interest in the Boto Gold Project in Senegal and 100% interest in each of: Karita Gold Project and associated exploration properties in Guinea, the Diakha-Siribaya Gold Project in Mali, and the early stage exploration properties of Boto West, Senala West, Daorala and the vested interest in the Senala Option Earn-in Joint Venture, also in Senegal. The Company received consent of IAMGOLD’s syndicate of lenders to complete the sale of its interests in the Bambouk Assets.

 

On April 25, 2023, the Company completed the sale of its 90% interest in the Boto Gold Project in Senegal and its 100% interest in the early-stage exploration properties of Boto West, Senala West, Daorala and the vested interest in the Senala Option Earn-in Joint Venture, also in Senegal, for aggregate gross cash proceeds of $197.6 million. The Company recognized a gain on disposal of the Senegal Assets of $109.1 million and paid taxes of $4.1 million.

 

Two transactions are remaining to close and both are subject to certain regulatory approvals from the respective governments, as well as other customary closing conditions included in the transaction agreements. The first of the two remaining transactions is expected to close in the first quarter 2024 with the final transaction expected to close during 2024.

 

Under the terms of the transaction agreements, exploration expenditures incurred to develop the Bambouk Assets further will be recouped from Managem upon closing.

 

FINANCIAL REVIEW

 

Liquidity and Capital Resources

 

As at December 31, 2023, the Company had $367.1 million in cash and cash equivalents at its continuing operations and net debt of $649.5 million. Approximately $387.0 million was available under the Company’s Credit Facility resulting in liquidity at December 31, 2023, of approximately $754.1 million.

 

Within cash and cash equivalents, $81.7 million was held by Côté Gold and $70.9 million was held by Essakane. The Côté Gold UJV requires its joint venture partners to fund, in advance, two months of future expenditures and cash calls are made at the beginning of each month, resulting in the month end cash balance approximating the following month’s expenditure.

 

On February 15, 2024, the Company completed a private placement of 1.9 million flow-through common shares of the Company (the “Flow-Through Shares”) that will qualify as “flow-through shares” (within the meaning of subsection 66(15) of the Income Tax Act (Canada)). The Flow-Through shares were issued at a price of C$4.20 per Flow-Through Share for aggregate gross proceeds of up to C$8.0 million.

 

The Company uses dividends and intercompany loans to repatriate funds from its operations and the timing of dividends may impact the timing and amount of required financing at the corporate level, including the Company’s drawdowns under the Credit Facility. Excess cash at Essakane is mainly repatriated through dividend payments, of which the Company will receive its 90% share, net of dividend taxes. Essakane declared a dividend of $120.0 million during 2023, which was received by IAMGOLD in the third quarter, net of minority interest and withholding taxes. During the remainder of construction and commissioning, the Company will fund its portion of the Côté UJV funding of $142.0 million from available cash balances.

 

Restricted cash in support of environmental closure costs obligations related to Essakane, Doyon division and Côté Gold Project totaled $66.1 million, with an additional $24.4 million held in escrow pending the closing of the EURO Ressources transaction. The following table summarizes the Company’s outstanding long-term debt:

 

 

December 31 December 31 December 31
($ millions)1 2023 2022 2021
Credit Facility $ $ 455.0 $
5.75% senior notes 448.0 447.6 445.7
Term Loan 375.6
Equipment loans 7.2 16.1 18.7
$ 830.8 $ 918.7 $ 464.4

 

  1. Long-term debt does not include leases in place at continuing operations of $121.3 million as at December 31, 2023 (December 31, 2022 – $73.8 million, December 31, 2021 – $11.4 million).

 

Credit Facility

 

The Company has a $425 million secured revolving Credit Facility, which was entered into in December 2017 and was amended for various items including to obtain consent to the sale of Rosebel, the sale of the Bambouk assets, for entering into the SMM funding arrangement and for entering into the second lien term loan. On November 9, 2023, the Company entered into a one year extension of its Credit Facility extending its maturity to January 31, 2026. As part of the extension, the Credit Facility was reduced from $490 million to $425 million based on the Company’s requirements for a senior revolving facility for its overall business. The Company has commitments for the full $425 million facility up to January 31, 2025, and for $372 million up to January 31, 2026.

 

As at December 31, 2023, the Credit Facility was undrawn and the Company issued letters of credit under the Credit Facility in the amount of $22.6 million as collateral for surety bonds issued, $11.3 million as guarantees for certain environmental indemnities to government agencies, and $4.1 million as a supplier payment guarantee, with $387.0 million remaining available under the Credit Facility.

 

5.75% Senior notes

 

In September 2020, the Company completed the issuance of $450 million of senior notes at face value with an interest rate of 5.75% per annum (the “Notes”). The Notes are denominated in U.S. dollars and mature on October 15, 2028. Interest is payable in arrears in equal semi-annual installments on April 15 and October 15 of each year, beginning on April 15, 2021, in the amount of approximately $12.9 million for each payment. The Notes are guaranteed by certain of the Company’s subsidiaries.

 

The Company incurred transaction costs of $7.5 million which have been capitalized and offset against the carrying amount of the Notes within long-term debt in the consolidated balance sheets and are being amortized using the effective interest rate method.

 

Term Loan

 

On May 16, 2023, the Company entered into the $400.0 million Term Loan. The Term Loan has a 3% original issue discount, bears interest at a floating interest rate of either one month or three month SOFR + 8.25% per annum and matures on May 16, 2028. The Term Loan is denominated in U.S. dollars and interest is payable upon each SOFR maturity date. The Term Loan notes are guaranteed by certain of the Company’s subsidiaries, subordinated to the Credit Facility.

 

The Company incurred transaction costs of $11.0 million, in addition to the 3% discount, which has been capitalized and offset against the carrying amount of the Term Loan within long-term debt in the consolidated balance sheets and is being amortized using the effective interest rate method. The Term Loan can be repaid in $20 million tranches at any time and has a make-whole premium if repaid in the first two years, a 104% premium if repaid after year two, a 101% premium if repaid after year three and 100% thereafter.

 

The Term Loan has a minimum liquidity requirement of $150 million and an interest coverage ratio (1.5x trailing consolidated EBITDA to consolidated interest expense) covenants and has no mandatory requirements for gold or other forms of hedging, cost overrun reserves or cash sweeps.

 

Leases

 

At December 31, 2023, the Company had lease obligations of $121.3 million at a weighted average borrowing rate of 7.20%.

 

On April 29, 2022, the Company, on behalf of the Côté Gold UJV, entered into a master lease agreement with Caterpillar Financial Services Limited to lease certain mobile equipment, which have been delivered through 2023 and will continue to be delivered through 2024, with a value of approximately $125 million. In connection therewith, SMM entered into a guarantee of 30% of the obligations under such agreement.

 

Equipment loans

 

At December 31, 2023, the Company had equipment loans with a carrying value of $7.3 million secured by certain mobile equipment, with interest rates between 5.23% and 5.95% which mature in 2026. The equipment loans are carried at amortized cost on the consolidated balance sheets.

 

Gold prepay arrangements

 

During 2021, the Company entered into gold sale prepayment arrangements at a weighted average cost of 4.45% per annum in respect of 150,000 gold ounces. These arrangements have an average forward contract pre-funded price of $1,753 per ounce on 50,000 gold ounces and an outstanding collar range of $1,700 to $2,100 per ounce on 100,000 gold ounces. The Company received $236.0 million in 2022 and is to physically deliver 150,000 ounces over the course of 2024.

 

In December 2023, the Company entered into a forward gold sale arrangement and a partial amendment to one of its existing gold prepay arrangements. Under the 2025 Q1 Prepay Arrangement, the Company will receive a prepayment amount of $59.9 million during first quarter 2024 at an effective gold price of $1,916 per ounce and paid equally in three monthly increments for physical delivery of 31,250 ounces of gold over the period of January 2025 to March 2025. The Deferral Prepay Arrangement allows for the deferral of 6,250 ounces that were previously scheduled for delivery in the first quarter 2024 under the existing gold prepay arrangements entered into in 2022 to now be delivered in the first quarter 2025. The Company will make a cash payment of $0.5 million in total at the time of delivery in consideration for the deferral. The net result of these arrangements is the effective transition of current gold delivery obligations out of the first quarter of 2024 into the first quarter of 2025, increasing cashflow in the first quarter 2024 by approximately $72.5 million assuming gold prices at the time of entering into the arrangement.

 

Liquidity Outlook

 

At December 31, 2023, the Company had available liquidity of $754.1 million comprised of $367.1 million in cash and cash equivalents and $387.0 million available under the Credit Facility.

 

IAMGOLD is expected to fund $142.0 million on project expenditures and working capital during the remainder of construction and commissioning based on its 60.3% interest in Côté Gold UJV.

 

On April 25, 2023, the Company completed the sale of its 90% interest in the Boto Gold Project in Senegal and its 100% interest in the early-stage exploration properties of Boto West, Senala West, Daorala and the vested interest in the Senala Option Earn-in Joint Venture, also in Senegal for aggregate gross cash proceeds of $197.6 million. The gross proceeds include deferred payments of $32.0 million that was received on October 26, 2023. The expected gross proceeds for the remainder of the transactions, in respect to the assets in Guinea and Mali, are approximately $84.4 million.

 

The Company also has to deliver 150,000 ounces of its 2024 production into the 2022 Prepay Arrangements. During December 2023, the Company entered into a further gold sale prepayment arrangement that effectively deferred the gold prepay deliveries from the first quarter 2024 to the first quarter 2025.

 

Based on the current construction and commissioning schedule of Côté Gold Project as well as prevailing market conditions which could impact the Côté Gold Project, commissioning and ramp-up expenditures and operating cash flows from the Company’s existing operations, the Company believes that its available liquidity at December 31, 2023, combined with cash flows from operations, the expected proceeds from the sale of the remaining Bambouk Assets and available liquidity provided by the undrawn amounts under the Credit Facility, is sufficient to fund the Côté UJV to complete the construction, commissioning and ramp-up of the Côté Gold Project.

 

The Company’s financial results are highly dependent on the price of gold, oil and foreign exchange rates and future changes in these prices will, therefore, impact performance. The Company’s ability to draw down on the Credit Facility is dependent on its ability to meet net debt to EBITDA and interest ratio covenants.

 

Income Statement

 

Revenues – Revenues from continuing operations were $297.6 million in the fourth quarter 2023 from sales of 147,000 ounces (136,000 ounces on an attributable basis) at an average realized gold price of $2,005 per ounce, higher by $90.4 million or 44% than the prior year period, due to higher sales volumes and a higher realized gold price.

 

Cost of sales – Cost of sales excluding depreciation was $176.7 million in the fourth quarter 2023, higher by $33.2 million or 23% than the prior year period. Cost of sales excluding depreciation was $647.0 million for the year, higher by $76.6 million or 13% than the prior year period.

 

Depreciation expense – Depreciation expense was $71.1 million in the fourth quarter 2023, higher by $27.4 million or 63% than the prior year period primarily due to higher production volumes and the amortization of deferred stripping assets as the mining activity sequences through Phase 5 at Essakane.

 

Exploration expense – Exploration expense was $3.6 million in the fourth quarter 2023, lower by $2.4 million or 40% than the prior year period due to the sale of certain exploration assets.

 

General and administrative expense – General and administrative expense was $10.7 million in the fourth quarter 2023, higher by $0.1 million or 1% than the prior year period, primarily due to prior year site support fees reclassified to discontinued operations of $0.8 million and higher consulting costs of $0.4 million, partially offset by lower bonus accruals of $0.8 million and share-based payments of $0.3 million.

 

Income tax expense – Income tax expense was $1.1 million in the fourth quarter 2023, lower by $9.9 million or 90% than the prior year period.

 

Operating Activities

 

Net cash flow from operating activities from continuing operations was $69.9 million for the fourth quarter 2023, higher by $57.6 million compared to the same prior year period, primarily due to higher cash earnings of $81.8 million due to higher sales volume and a higher realized gold price, an increase in accounts payable and accrued liabilities of $33.1 million primarily resulting from the timing of payment of supplies, and a decrease in trade and other receivable of $7.0 million, offset by net proceeds from the 2022 Prepay Arrangements of $59.0 million included in the fourth quarter 2022, and an increase in income tax paid of $6.6 million.

 

Investing Activities

 

Net cash used in investing activities from continuing operations for the fourth quarter 2023 was $272.2 million, an increase of $66.8 million from the same prior year period, primarily due to an increase in capital expenditures from property, plant and equipment of $63.8 million, mainly related to the Côté Gold construction, an increase in restricted cash contribution of $24.4 million as the company posted the security for the purchase of the minority interest of Euro Ressources, and an increase in capitalized borrowing costs of $7.3 million offset by net cash proceeds of $32.0 million received from the sale of the Senegal Assets.

 

Financing Activities

 

Net cash from financing activities from continuing operations for the fourth quarter 2023 was $16.9 million. Compared to the fourth quarter 2022, net cash from financing activities for continuing operations decreased by $51.7 million, primarily due to a draw of $75.0 million Credit Facility in the fourth quarter 2022, offset by the proceeds received through the SMM funding arrangement of $28.0 million during the fourth quarter 2023.

 

ABOUT IAMGOLD

 

 

IAMGOLD is an intermediate gold producer and developer based in Canada with operating mines in North America and West Africa. The Company is building the large-scale, long life Côté Gold project in Canada in partnership with Sumitomo Metal Mining Co. Ltd., which is expected to commence production in the first quarter of 2024. In addition, the Company has an established portfolio of early stage and advanced exploration projects within high potential mining districts in the Americas. IAMGOLD employs approximately 3,600 people and is committed to maintaining its culture of accountable mining through high standards of Environmental, Social and Governance practices, including its commitment to Zero Harm®, in every aspect of its business. IAMGOLD is listed on the New York Stock Exchange and the Toronto Stock Exchange and is one of the companies on the Jantzi Social Index, a socially screened market capitalization-weighted consisting of companies which pass a set of broadly based environmental, social and governance rating criteria.

 

Posted February 16, 2024

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