GoGold Resources Inc. reported record production of 417,191 silver equivalent ounces in the quarter and generated revenue of US$5.4 million in Q1 2018.
GoGold Resources Inc. (TSX:GGD) reported record production of 417,191 silver equivalent ounces in the quarter and generated revenue of US$5.4 million on the sale of 337,821 silver equivalent ounces at an average realized price of US$15.99 in the quarter ending March 31, 2018.
As quoted in the press release:
The difference between ounces produced and sold was attributed to an increase in ounces awaiting settlement at the refinery. These ounces were received and sold in April 2018 and the company does not expect there to be a delay in settlements in the current quarter. The company’s production represents an increase of 50 percent over the second quarter of 2017 and the sixth consecutive quarter of production growth.
The company stacked 439,376 tonnes on the leach pad which represents a 22 percent increase from the second quarter of 2017. The company completed the re-agglomeration of some of the older pads and stacked 193,516 tons of fresh tailings. Management foresees an increase in production in future quarters due to the higher stacking rates, fresh tailings coming under leach, as well as the residual leaching from the first lift. Cash costs for the quarter were US$10.67 per silver equivalent ounce which was up 18 percent from the second quarter 2017 due to the additional costs associated with re-agglomerating some material. This number is expected to decrease as we stack more fresh tailings in future quarters.
The company reports a net loss of US$41,000 for the three months ended March 31, 2018, and net income of US$30.0 million and total comprehensive income of US$42.5 million for the six months ended March 31, 2018.
The company is pleased to report that during the quarter Agnico Eagle Mines began an initial drilling program at the Santa Gertrudis project with a budget of US$8.3 million for the first phase of drilling. The company retained a 2 percent net smelter royalty on the project as part of the sale in November 2017 and this exploration program reaffirms managements view of its value.
As a result of the sale of Santa Gertrudis in November 2017 the company’s working capital has improved by US$56.8 million to US$46.5 million during fiscal 2018. Shareholders equity has also improved by US$42.6 million to US$130.4 million during the year. The Company remains in strong financial condition with US$12.7 million in cash, a royalty on Santa Gertrudis that management believes could be sold for approximately US$15 million, inventory stacked on the heap leach pad with recoverable metal worth approximately US$40 million, and no debt. In addition to the strong balance sheet, Parral is generating earnings before interest, taxes, and depreciation and has a mine life of approximately 10 years.