TORONTO (miningweekly.com) – TSX- and NYSE-listed Alamos Gold has announced disappointing third-quarter results, citing that heavy rains and lower recoveries weighed on its flagship Mulatos operation’s performance, in Mexico.
The Toronto-based miner reported that despite stacking ore containing about 51 900 oz of gold for the leach pad in the quarter ended September 30, the total output of 28 000 oz was the result of a severe rainy season, culminating with record rainfall in September.
This resulted in the dilution of the heap leach solutions and delayed the recovery of a significant portion of these ounces; however, Alamos expected to see the benefit of these stacked ounces in the fourth quarter.
For the quarter, the company reported a 35% year-on-year decline in ounces produced and gold sales were down 38% at 30 000 oz, resulting in revenue of $38.52-million, down 40% from the same period a year earlier.
Alamos noted a net loss of $2.23-million, or $0.02 a share, compared with average analyst expectations of a profit of $0.01 a share.
The company reported 42% higher all-in costs of $1 148/oz and cash operating costs were 66% higher than the $434 figure reported a year earlier.
However, CEO John McCluskey said Alamos still expected to hit the lower end of its production guidance at 150 000 oz.
Combined with the ramp-up of high-grade mill production from San Carlos, the company expected a significant increase in production in the fourth quarter, he pointed out.
Alamos reported cash in the bank of $375.2-million as at the end of the quarter and had announced a semi-annual dividend of $0.10 a common share payable on October 31. Including this dividend, Alamos had returned more than $102-million to shareholders in the form of dividends and share repurchases over the past four years.
Since the start of the year, the company's NYSE-listed stock lost 34.27% of its value and on Friday closed down just over a per cent at $8.05 apiece.