TORONTO (miningweekly.com) – Toronto-listed Mandalay Resources on Thursday said gold-equivalent production was down by 19% on the fourth quarter as a result of plant downtime and lower grades.

During the quarter ended March 31, Mandalay had produced a total 27 128 gold-equivalent ounces, comprised of 10 635 oz of gold, 766 t of antimony and 611 441 oz of silver from its operating mines in Australia and Chile.

Gold-equivalent sales were also down 21% to 26 786 oz.

CEO Brad Mills said Mandalay's production and sales for the first quarter were in line with expectations.

The company’s Costerfield mine, in Australia, delivered a strong performance, continuing a trend of improvement over the last few quarters by achieving record gold production and near-record antimony production. This high level of production was expected to continue as the operation ramped up production on the N-Lode and began development of the Cuffley Lode.

Mandalay said the lower quarter-on-quarter production at its Cerro Bayo operation, in Chile, was expected and was the result of plant downtime as a result of installing and commissioning flotation automation equipment, which was designed to improve recoveries of gold and silver.

The company also fed lower-grade ore through the plant as part of the commissioning programme for this new equipment.

“We expect ore grades to improve, along with recoveries, in the next three quarters and we expect to deliver the full 2013 production guidance over the course of the year,” Mills said.

The company expected to produce between 112 000 oz to 123 000 oz of gold equivalent this year.

In March, Mandalay reported a significant increase in its overall reserves. Contained gold in the proven and probable reserve categories grew by 33% to 214 000 oz, contained silver grew by 14% to 18.25-million ounces, and contained antimony grew by 38% to 7 200 t, all net of mine depletion.

The company’s stock on Thursday climbed by 6.25% to trade at C$0.85 apiece on the TSX, but had lost 30.43% of its value in the year to date.