Richmont Mines Reports Q2 2013 Results

 Richmont Mines Inc. (TSX:RIC,NYSE:RIC) released financial and operational results for its second quarter that ended on June 30, 2013. Highlights include gold sales of 12,826 ounces at an average selling price of $1,389, significant improvement at its Beaufor mine, 13,797 metres of exploration drilling completed at its Island Gold Deep project, successful bulk samples completed at its W Zone and Monique Gold projects, and a Letter of Offer received for a Senior Secured Credit Facility for up to US$50 million from Macquarie Bank Limited to fund development of its Island Gold Deep project.

As quoted in the press release:

Highlights:

• Q2 2013 net loss of $1.1 million, or $0.03 per share, versus Q2 2012 net loss from continuing operations of $2.9 million, or $0.09 per share;
• Gold sales of 12,826 ounces at an average selling price of $1,389 (US$1,367) per ounce in Q2 2013, versus gold sales of 14,611 ounces at an average selling price of $1,617 (US$1,618) per ounce in the prior year;
• Significant improvement at Beaufor; gold sales of 6,352 ounces at cash costs of $777 (US$765) per ounce;
• 13,797 metres of exploration drilling completed at Island Gold Deep project in Q2 2013, bringing year-to-date exploration to 25,389 metres. Additional drilling has largely been comprised of step-out holes from the previously established estimated Inferred resources of 508,000 ozs, with preliminary analysis indicating that the C Zone continues to expand and remains open in all directions. Updated resource for project expected in Q3 2013;
• Successful bulk samples completed at W Zone and Monique Gold projects; both projects to proceed to commercial production;
• Letter of Offer received for a Senior Secured Credit Facility for up to US$50 million from Macquarie Bank Limited to fund the long-term development of the Island Gold Deep project;
• Cash and cash equivalents of $26.5 million, or $0.67 per share, as of June 30, 2013, and long-term debt remains minimal at $1.3 million.

Richmont Mines Inc. President and CEO, Paul Carmel, said:

We are very pleased with the notable improvements at our Beaufor Mine this quarter, and the 53% year-over-year decrease in cash cost per ounce at the mine to $777 (US$765) is testament to the selective mining approach that we have implemented over the past quarter and to the work ethic of our employees who have embraced and adopted our newly-implemented measures. Also of note in the second quarter were the successful bulk samples taken from our W Zone and Monique projects, which are now proceeding to commercial production. With the additional material from these operations, our Camflo Mill is now operating at full capacity and we expect it to deliver lower unit costs. At Island Gold, our Island Gold Deep project continues to progress on schedule, but our operational performance at the mine was below expectations for the quarter. Reasons include mechanical issues at the mill, which have since been resolved, and haulage equipment shortages that we have addressed by acquiring four new 30 tonne capacity Caterpillar trucks under capital lease programs. While the new equipment will translate into improvements in the latter half of this year and thereafter, our year-to-date production levels at Island Gold are below budgeted levels. That being said, we expect the improved performance at Beaufor to largely mitigate lower production from Island Gold.

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