TORONTO (miningweekly.com) – Canadian precious metals miner Primero Mining on Thursday reported a net loss of $105.9-million, or $0.66 a share, in the three months ended September 30, which included a goodwill impairment charge of $99-million related to its $220-million Brigus Gold acquisition in March.

The latest quarter’s net loss compared unfavourably with earnings of $10.1-million, or $0.09 a share, in the same quarter a year earlier.

Excluding special items, Primero reported earnings of $300 000, or nil a share, down from $11-million, or $0.09 a share, over the same period last year.

The TSX- and NYSE-listed miner, which operated mines in Mexico and the Ontario-based Black Fox mine acquired through the Brigus deal, reported that its revenues increased to $75.5-million, up from $53.8-million in the comparable period a year earlier, with Black Fox accounting for $24.2-million of the increase.

The company produced 59 673 gold equivalent ounces in the period compared with 41 998 gold equivalent ounces a year earlier. Gold output rose to 51 464 oz and silver output declined to 1.41-million ounces.

All-in sustaining costs (AISC) an ounce were $1 154 compared with $974/oz in the same period of 2013.

In the quarter ended September 30, Primero’s flagship San Dimas mine increased mill throughput as planned but as a result of lower grades and recoveries for both gold and silver, produced 11% less precious metals year-over-year. The San Dimas mill throughput was impacted slightly by power interruptions as a result of high rainfall in July. The company’s mine plan called for lower grades in the second half of 2014.

Primero announced on August 7 that it had approved the second phase of the San Dimas expansion to 3 000 t/d.

The Black Fox mine produced 22 288 oz of gold, 30% higher than the second quarter and 68% higher than the first three months of the year.

In an analyst phone call, president and CEO Joseph Conway said the company was focused on lowering costs across the company, in preparation for potentially sustained low gold prices.

Gold bullion this week fell to $1 137.40/oz, testing its lowest levels since 2010.

“Despite [improvement in Black Fox’s performance] and in light of the impairment and lower precious metals environment, we will be reducing our capital expenditure at the Black Fox mine for 2015 and will ensure it is a profitable and self-sustaining operation next year. At a corporate level, we are streamlining our operations by closing our Vancouver office, incurring some one-time closure expenses during the third quarter,” Conway pointed out.

The company issued a revised output guidance, saying that it now expected to produce between 220 000 oz and 240 000 oz of gold equivalent at cash costs of between $675/oz and $725/oz in 2014.

This represented a decrease from the previous guidance of between 225 000 oz and 245 000 oz of gold equivalent.

Primero explained that it expected fewer ounces from Black Fox at between 65 000 oz and 75 000 oz, down from 70 000 oz to 80 000 oz, at unchanged cash costs of between $850/oz and $900/oz, while AISC increased to between $1 400/oz and $1 450/oz, reflecting the optimisation plan to increase underground throughput.

The company also announced new high-grade drilling results that further expanded the known mineralisation at depth at Black Fox and provided increased confidence in the Grey Fox project.

Primero’s NYSE-listed stock on Thursday closed 2.84% lower at $3.08 apiece. The stock had lost 46% in value since the start of the year.