TORONTO (miningweekly.com) – Strong operating margins from higher realised gold prices and low cash costs contributed to Canadian miner Alamos Gold reporting record cash and earnings from higher production and sales in the fourth quarter of 2012.
The company on Thursday said quarterly earnings rose by 78% year-on-year to $37.9-million, or 31c a share, as a result of more ounces sold and a lower effective tax rate.
Alamos sold 62 516 oz of gold for record quarterly revenues of $106.9-million.
Earnings rose by 78% year-on-year to $37.9-million or $0.31 a share during the quarter ended December 31.
The company reported record cash from operating activities before changes in noncash working capital of $53.5-million or 44c a share and after changes in noncash working capital of $69.2-million or 57c a share.
For the quarter, the company produced a record 67 800 oz of gold at a cash operating cost of $377/oz of gold sold, excluding royalties.
For the full year, Alamos sold 197 516 oz of gold at an average realised price of $1 668/oz, for revenues of $329.4-million.
Full-year earnings were $118-million or 98c a share, compared with earnings of $60.1-million or 51c a share in 2011.
“In 2012, Alamos achieved the best performance for any year in its history and, in the final three months, posted record results for any quarter. We established a new benchmark by producing 200 000 oz of gold in 2012 (including 67 800 oz in the fourth quarter) at a cash operating cost of $355/oz, which is at industry-leading low levels,” president and CEO John McCluskey said in a statement.
Alamos said it remained on track with the permitting of its late-stage development projects in Turkey. “We anticipate responses from the Turkish government on our environmental-impact-assessment submissions for Kirazli and Ağı Dağı by the end of the first and second quarters respectively, and we expect our outstanding cash flow and balance sheet will enable us to self-finance the construction of these mines,” he added.
The company, which started trading on the NYSE last week, expects to produce between 180 000 oz and 200 000 oz at a cash operating cost of $415/oz to $435/oz sold, excluding a 5% royalty.
Meanwhile, on January 14, the company announced an offer to acquire Aurizon Mines for about C$780-million in cash and shares. Last week, Alamos and Aurizon consented to an order by the British Columbia Securities Commission to cease trade the Aurizon shareholder rights plan on March 4, which prompted Alamos to extend the offer to 17:00 on March 5.
The company’s stock traded at C$13.68 apiece on the TSX on Thursday at noon.