Premier Gold production over 16K Oz in 4Q
Premier Gold Mines Limited announces operating results for the three months and year ended December 31, 2019. The Company previously released its production results for the fourth quarter.
Premier is a gold-producer and respected exploration and Development Company with high-quality precious metal projects in proven, accessible and safe mining jurisdictions in Canada, the United States, and Mexico. Premier’s team is focused on creating a low-cost, mid-tier gold-producer from its two producing gold mines and two advanced-stage, multi-million ounce development projects.
According to 2019 Fourth quarter and year ended December 31, 2019 said, a total of 16,880 ounces of gold and 45,500 ounces of silver were produced during Q4 2019 compared to 23,042 ounces of gold and 120,730 ounces of silver during Q4 2018. Co-product cash costs (1) during the period were $1,087 per ounce sold compared to $1,095 for Q3 2019 and $619 for Q4 2018. All-in sustaining costs (AISC) (1) were $1,217 per ounce of gold sold for Q4 2019 compared to $1,354 for Q3 2019 and $798 for Q4 2018.
The Company reported total revenue of $28.9 million during the fourth quarter compared to $19.9 million during Q4 2018. Despite lower production, the increase in revenue when compared to Q4 2018 is the result of a higher average realized gold price per ounce of $1,416 compared to $1,250 in Q4 2018 and reduced ounces sold in Q4 2018.
A total of 67,427 ounces of gold and 192,829 ounces of silver were produced during 2019 compared to 89,699 ounces of gold and 321,814 ounces of silver during the prior year of which 60% of the reduction is related to the South Arturo production profile and 40% related to the Mercedes mine. Co-product cash costs(1) in 2019 were $998 and AISC(1) were $1,218 per ounce of gold sold compared to $788 and $927 respectively for 2018 primarily related to the reduction in overall production.
The Company reported total revenue of $93.7 million in 2019 as compared to $113.9 million in the prior year. The reduction in revenue is the result of lower sales from both South Arturo and Mercedes Mines. This was anticipated as the Company transitioned from Phase 2 production to El Nino underground at South Arturo.
Multiple factors led to lower production and sales at Mercedes than the prior year. Production was primarily impacted by higher than planned dilution in several mining zones as well as some unexpected events such as a large natural void (vug) that was encountered in the Rey de Oro zone. Combined, this resulted in lower head grades for this period.
In keeping with its longer-term objective of increased annual production over the next several years, the Company invested $24.1 million in exploration and pre-development initiatives during 2019. When factored with the reduction in mine operating income, this investment contributed to a net loss of $20 million. Total capital spending during the year was $52.2 million, including the construction of the El Nino underground and the Phase I open pit mines initiated at South Arturo.
The Company closed the year with cash and cash equivalents of $58.4 million as the result of several initiatives including: a finance package early in the year; a revolving line of credit agreement; and the sale of royalties. The Company held inventory of 1,585 ounces of gold, 4,459 ounces of silver at year end.
“Q4 was the first full quarter of production at South Arturo following after successful construction of the El Nino underground mine” stated Ewan Downie, President & CEO. “Its addition is expected to contribute positively to Premier’s 2020 operating results”.
