Canadian gold miner Iamgold has maintained its 2019 production and costs targets, but said on Monday that it would review its guidance in the second half of the year, following a “challenging” first quarter.

Attributable gold production, inclusive of joint venture (JV) operations, fell by 23% year-on-year to 185 000 oz in the first quarter, owing to the impact of increased seismicity at the Westwood mine, in Quebec, lower head grades and throughput at Essakane, in Burkina Faso, and lower head grades at its JV operations.

Sales decreased to 190 000 oz in the quarter, which is 45 000 oz less than the prior-year period. Essakane’s sales were 20 000 oz less than a year earlier and Westwood’s sales were 19 000 oz less.

The lower sales at these two mines pushed up total cash costs by 20% to $884/oz. All-in sustaining costs (AISC) rose by 14% to $1 086/oz.

Iamgold said that it still expected to produce between 810 000 oz and 870 000 oz of gold this year, at an AISC of $1 030/oz to $1 080/oz. A number of cost and productivity improvement initiatives were under way to ensure that it remained on track to achieve its cost of sales guidance of $790/oz to $840/oz and its total cash cost guidance of $765/oz to $815/oz.

The miner stated that its guidance would be reviewed in the second quarter 2019, and noted that gold production at Westwood was expected to improve starting in the second quarter.

"Despite a challenging first quarter, we are driving towards achieving a self-funded, self-sustaining operating model," commented CEO and president Steve Letwin.

"This encompasses our goal to reduce costs and increase margins, preserve cash, fund site capital expenditures within site cash flows, and work safely and responsibly. At Essakane, we had strong production and cash flow generation and are optimising performance through de-bottlenecking and other projects. At Rosebel, we reported significant reserve growth extending the mine life, with Saramacca first production planned in the second half of 2019. At Westwood, we have a long-life production asset in a transition year, with mine redesign in progress. Production remains on track for the year, with the first half lighter than the balance of the year, as anticipated, and we reinforce our 2019 annual production guidance,” he stated.

Revenues for the first quarter were $251-million, down $63.5-million or 20% from the same prior-year period. The decrease was primarily owing to lower sales volumes, combined with a lower realised gold price.

Iamgold posted a loss attributable to equity holders of $41.3-million, or $0.09 a share, compared with earnings of $42.3-million, or $0.09 a share, a year earlier. The adjusted net loss was $2.2-million, or $0 a share, compared with adjusted net earnings of $40.4-million, or $0.09 a share, in the same prior-year period.