Centerra Gold Inc. (“Centerra” or the “Company”) (TSX: CG and NYSE:
CGAU) today reported its third quarter 2023 operating and financial
results.
President and CEO, Paul Tomory, commented,
“Centerra had a strong third quarter, with cash provided by mine
operations of $144 million and $36 million, from Öksüt and Mount
Milligan, respectively. In addition, the Langeloth Metallurgical
Facility returned $17 million from the previous investment into
working capital, all of which drove a substantial increase to our
cash balance. Öksüt outperformed our expectations, producing almost
87,000 ounces in the quarter. Our 2023 consolidated gold production
guidance remains on track to be between 340,000 to 360,000 ounces
and we expect to continue to generate significant free cash flow in
the fourth quarter, resulting in a higher cash balance by the end
of the year. We remain on track for a strong finish to 2023.”
“In September, we announced positive economics
for the Thompson Creek Mine restart, while simultaneously
initiating a process to evaluate all strategic options for the
Molybdenum Business Unit assets. We also continue to drive
operational and technical improvements at Mount Milligan to unlock
its full potential as our cornerstone asset. Given the results from
this quarter, we are optimistic about the future of Centerra and
our ability to internally fund our strategic initiatives with cash
flows from operations.”
Third Quarter Highlights
Operations:
- Production: Third
quarter 2023 gold production of 126,221 ounces, including
production of 39,554 ounces of gold from the Mount Milligan Mine
(“Mount Milligan”) and 86,667 ounces of gold from the Öksüt Mine
(“Öksüt”). Copper production in the quarter was 15.0 million
pounds.
- Sales: Third
quarter 2023 gold sales of 130,973 ounces at an average realized
market price of $1,741 per ounce and copper sales of 15.4 million
pounds at an average realized copper price of $2.99 per pound.
- Costs:
Consolidated gold production costs were $643 per ounce and all-in
sustaining costs (“AISC”) on by-product basisNG were $827 per ounce
for the quarter, with the effect of higher gold sales from Öksüt
offsetting higher production costs from Mount Milligan.
- Capital
expendituresNG: Third quarter 2023
additions to property, plant, equipment (“PPE”) and sustaining
capital expendituresNG were $25.0 million and $23.5 million,
respectively. Sustaining capital expendituresNG in the third
quarter 2023 included capitalization to the tailings storage
facility (“TSF”), as well as construction of a water pumping system
at Mount Milligan, and deferred stripping at Öksüt.
- Guidance:
Centerra’s 2023 consolidated gold production guidance remains on
track to be between 340,000 to 360,000 ounces. The Company is
increasing gold production guidance at Öksüt and lowering it at
Mount Milligan. Centerra’s 2023 copper production guidance remains
unchanged at 60 to 70 million pounds and is expected to be near the
low end of the range. Centerra’s 2023 consolidated gold production
cost guidance is unchanged and is expected to be in the range of
$700 to $750 per ounce.
Financial:
- Net earnings: Net
earnings of $60.6 million or $0.28 per share and adjusted net
earningsNG of $44.4 million or $0.20 per share. Adjustments include
$23.1 million of reclamation provision revaluation recovery, $2.3
million unrealized foreign exchange gains related to the
reclamation provision at the Endako Mine and the Kemess Project,
and $9.2 million of deferred income tax expense resulting from the
effect of foreign exchange rate changes on monetary assets and
liabilities in the determination of taxable income related to Öksüt
and Mount Milligan.
- Free cash
flowNG: Cash provided by operating
activities of $166.6 million and free cash flowNG of $144.5
million, including cash provided by mine operations and free cash
flow from Öksüt of $143.9 million and $133.8 million,
respectively.
- Cash and cash
equivalents: Total liquidity of $890.2 million,
representing a cash balance of $492.1 million and $398.1 million
available under a corporate credit facility as at September 30,
2023.
- Dividend:
Quarterly dividend declared of C$0.07 per common share.
Other:
- Corporate credit
facility: In September 2023, the Company announced the
extension of its $400 million revolving credit facility, which is
currently undrawn, with a renewed four-year term maturing on
September 8, 2027.
- Corporate development
updates: In the third quarter 2023, a deferred milestone
payment of $31.5 million was paid to Waterton Nevada Splitter, LLC
(“Waterton”) in connection with the February 2022 acquisition of
the Goldfield Project. Partially offsetting the third quarter
payment to Waterton, in the fourth quarter 2023 Centerra expects to
receive a milestone payment of $25 million from a subsidiary of the
Orion Mine Finance Group in relation to the sale of its 50%
interest in the Greenstone Gold Mines Partnership (“Greenstone
Project”) in 2021. Future payments to Centerra in relation to the
Greenstone Project are payable as certain production thresholds are
met.
- Intention to renew normal
course issuer bid (“NCIB”): Centerra believes its share
price continues to be trading in a range that does not adequately
reflect the value of its assets and future prospects. As a result,
subject to the approval of the Toronto Stock Exchange (“TSX”),
Centerra intends to renew its NCIB to purchase for cancellation up
to an aggregate of 18,293,896 common shares in the capital of
the Company (“Common Shares”), representing 10% of the public
float. As of October 31, 2023, Centerra had 215,807,212 issued
and outstanding Common Shares.
Table 1 - Overview of Consolidated Financial and
Operating Highlights
($millions, except as
noted) |
Three months ended September 30, |
Nine months ended September 30, |
|
2023 |
2022 |
|
% Change |
2023 |
|
2022 |
|
% Change |
Financial
Highlights |
|
|
|
|
|
Revenue |
343.9 |
179.0 |
|
92 |
% |
754.9 |
|
641.9 |
|
18 |
% |
Production costs |
186.8 |
132.0 |
|
42 |
% |
544.6 |
|
416.5 |
|
31 |
% |
Depreciation, depletion, and amortization ("DDA") |
42.5 |
14.4 |
|
195 |
% |
84.4 |
|
79.9 |
|
6 |
% |
Earnings from mine operations |
114.6 |
32.6 |
|
252 |
% |
125.9 |
|
145.5 |
|
(13 |
)% |
Net earnings (loss) |
60.6 |
(33.9 |
) |
279 |
% |
(52.5 |
) |
52.9 |
|
(199 |
)% |
Adjusted net earnings
(loss)(1) |
44.4 |
(15.9 |
) |
379 |
% |
(50.7 |
) |
4.3 |
|
(1279 |
)% |
Cash provided by (used in)
operating activities |
166.6 |
(17.0 |
) |
1080 |
% |
100.2 |
|
7.8 |
|
1185 |
% |
Free cash flow
(deficit)(1) |
144.4 |
(35.5 |
) |
507 |
% |
49.1 |
|
(57.6 |
) |
185 |
% |
Additions to property, plant
and equipment (“PP&E”) |
25.0 |
11.7 |
|
113 |
% |
53.8 |
|
247.2 |
|
(78 |
)% |
Capital expenditures -
total(1) |
24.6 |
16.1 |
|
53 |
% |
51.9 |
|
57.8 |
|
(10 |
)% |
Sustaining capital expenditures(1) |
23.5 |
16.0 |
|
47 |
% |
49.0 |
|
55.8 |
|
(12 |
)% |
Non-sustaining capital expenditures(1) |
1.1 |
0.1 |
|
1000 |
% |
2.9 |
|
2.0 |
|
45 |
% |
Net earnings (loss) per common
share - $/share basic(2) |
0.28 |
(0.14 |
) |
300 |
% |
(0.24 |
) |
0.19 |
|
(227 |
)% |
Adjusted net earnings (loss) per common share - $/share
basic(1)(2) |
0.20 |
(0.06 |
) |
433 |
% |
(0.23 |
) |
0.02 |
|
(1250 |
)% |
Operating highlights |
|
|
|
|
|
|
Gold produced (oz) |
126,221 |
54,134 |
|
133 |
% |
221,058 |
|
190,646 |
|
16 |
% |
Gold sold (oz) |
130,973 |
56,245 |
|
133 |
% |
218,118 |
|
192,750 |
|
13 |
% |
Average market gold price
($/oz) |
1,929 |
1,728 |
|
12 |
% |
1,931 |
|
1,826 |
|
6 |
% |
Average realized gold price
($/oz )(3) |
1,741 |
1,204 |
|
45 |
% |
1,642 |
|
1,470 |
|
12 |
% |
Copper produced (000s
lbs) |
15,026 |
19,045 |
|
(21 |
)% |
42,168 |
|
56,955 |
|
(26 |
)% |
Copper sold (000s lbs) |
15,385 |
19,647 |
|
(22 |
)% |
43,548 |
|
58,019 |
|
(25 |
)% |
Average market copper price
($/lb) |
3.79 |
3.52 |
|
8 |
% |
3.89 |
|
4.12 |
|
(6 |
)% |
Average realized copper price
($/lb)(3) |
2.99 |
2.49 |
|
20 |
% |
3.01 |
|
2.82 |
|
7 |
% |
Molybdenum sold (000s
lbs) |
2,700 |
3,291 |
|
(18 |
)% |
9,077 |
|
9,406 |
|
(3 |
)% |
Average market molybdenum
price ($/lb) |
23.77 |
16.12 |
|
47 |
% |
26.05 |
|
17.86 |
|
46 |
% |
Average
realized molybdenum price ($/lb) |
24.08 |
17.17 |
|
40 |
% |
25.71 |
|
19.18 |
|
34 |
% |
Unit costs |
|
|
|
|
|
|
Gold production costs
($/oz)(4) |
643 |
729 |
|
(12 |
)% |
820 |
|
653 |
|
26 |
% |
All-in sustaining costs on a
by-product basis ($/oz)(1)(4) |
827 |
941 |
|
(12 |
)% |
1,122 |
|
826 |
|
36 |
% |
All-in costs on a by-product
basis ($/oz)(1)(4) |
983 |
1,376 |
|
(29 |
)% |
1,471 |
|
1,105 |
|
33 |
% |
Gold - All-in sustaining costs
on a co-product basis ($/oz)(1)(4) |
858 |
1,190 |
|
(28 |
)% |
1,168 |
|
1,062 |
|
10 |
% |
Copper production costs
($/lb)(4) |
2.30 |
1.51 |
|
52 |
% |
2.43 |
|
1.63 |
|
49 |
% |
Copper - All-in sustaining
costs on a co-product basis – ($/lb)(1)(4) |
2.73 |
1.78 |
|
53 |
% |
2.78 |
|
2.04 |
|
36 |
% |
(1) Non-GAAP financial measure. See discussion under
“Non-GAAP and Other Financial Measures”.(2) As at
September 30, 2023, the Company had 215,748,999 common shares
issued and outstanding.(3) This supplementary financial
measure within the meaning of National Instrument 52-112 - Non-GAAP
and Other Financial Measures Disclosure (“NI 51-112”). is
calculated as a ratio of revenue from the consolidated financial
statements and units of metal sold and includes the impact from the
Mount Milligan Streaming Arrangement, copper hedges and
mark-to-market adjustments on metal sold not yet finally
settled.(4) All per unit costs metrics are expressed on a
metal sold basis.
2023 Outlook
Centerra’s consolidated guidance for production
and unit costs remains unchanged from the previously disclosed
guidance on June 30, 2023 in our second quarter report. The Company
has revised its 2023 outlook for Öksüt and Mount Milligan based on
updated estimates for metal production and corresponding unit costs
at both mines. The Company’s updated 2023 outlook and comparative
actual results for the nine months ended September 30, 2023 are set
out in the tables below.
|
Units |
2023 Guidance - updated |
Nine Months 2023 results |
2023 Guidance - previous |
Production |
|
|
|
|
Total gold production(1) |
(Koz) |
340 - 360 |
221 |
340 - 360 |
Mount Milligan Mine(2)(3)(4) |
(Koz) |
150 - 160 |
114 |
160 - 170 |
Öksüt Mine |
(Koz) |
190 - 200 |
107 |
180 - 190 |
Total copper production(2)(3)(4) |
(Mlb) |
60 - 70 |
42 |
60 - 70 |
Unit Costs(5) |
|
|
|
|
Gold production costs(1) |
($/oz) |
700 - 750 |
820 |
700 - 750 |
Mount Milligan Mine(2) |
($/oz) |
1,050 - 1,100 |
1,134 |
1,000 - 1,050 |
Öksüt Mine |
($/oz) |
425 - 475 |
440 |
450 - 500 |
All-in sustaining costs on a by-product basisNG(1)(3)(4) |
($/oz) |
1,000 - 1,050 |
1,122 |
1,000 - 1,050 |
Mount Milligan Mine(4) |
($/oz) |
1,175 - 1,225 |
1,214 |
1,125 - 1,175 |
Öksüt Mine |
($/oz) |
625 - 675 |
679 |
650 - 700 |
All-in costs on a by-product basisNG(1)(3)(4) |
($/oz) |
1,225 - 1,275 |
1,471 |
1,225 - 1,275 |
Mount Milligan Mine(4) |
($/oz) |
1,225 - 1,275 |
1,249 |
1,175 - 1,225 |
Öksüt Mine |
($/oz) |
725 - 775 |
836 |
750 - 800 |
All-in sustaining costs on a co-product basisNG(1) |
($/oz) |
1,050 - 1,100 |
1,168 |
1,050 - 1,100 |
Mount Milligan Mine |
($/oz) |
1,275 - 1,325 |
1,300 |
1,225 - 1,275 |
Öksüt Mine |
($/oz) |
625 - 675 |
836 |
650 - 700 |
Copper production costs |
($/lb) |
2.15 - 2.40 |
2.43 |
2.15 - 2.40 |
All-in sustaining costs on a co-product basisNG |
($/lb) |
2.90 - 3.15 |
2.78 |
2.90 - 3.15 |
Capital Expenditures |
|
|
|
|
Additions to PP&E(1) |
($M) |
90 - 115 |
53.8 |
90 - 115 |
Mount Milligan Mine |
($M) |
50 - 60 |
25.4 |
50 - 60 |
Öksüt Mine |
($M) |
35 - 45 |
23.4 |
35 - 45 |
Total Capital
ExpendituresNG(1) |
($M) |
90 - 115 |
51.9 |
90 - 115 |
Mount Milligan Mine |
($M) |
50 - 60 |
27.6 |
50 - 60 |
Öksüt Mine |
($M) |
35 - 45 |
20.5 |
35 - 45 |
Sustaining Capital
ExpendituresNG(1) |
($M) |
90 - 110 |
49.0 |
90 - 110 |
Mount Milligan Mine |
($M) |
50 - 60 |
27.6 |
50 - 60 |
Öksüt Mine |
($M) |
35 - 45 |
20.5 |
35 - 45 |
Non-sustaining Capital ExpendituresNG(6) |
($M) |
3 - 4 |
2.8 |
2.00 |
Depreciation, depletion and amortization(1) |
($M) |
115 - 140 |
84.4 |
115 - 140 |
Mount Milligan Mine |
($M) |
65 - 80 |
58.6 |
65 - 80 |
Öksüt Mine |
($M) |
40 - 50 |
22.2 |
40 - 50 |
Income tax and BC mineral tax expense(1) |
($M) |
80 - 90 |
0.0 |
80 - 90 |
Mount Milligan Mine |
($M) |
1 - 3 |
1.3 |
1 - 3 |
Öksüt Mine |
($M) |
75 - 85 |
45.2 |
75 - 85 |
- Consolidated Centerra figures.
- The Mount Milligan Mine is subject
to an arrangement with RGLD Gold AG and Royal Gold, Inc. (together,
“Royal Gold”) which entitles Royal Gold to purchase 35% and 18.75%
of gold and copper produced, respectively, and requires Royal Gold
to pay $435 per ounce of gold and 15% of the spot price per metric
tonne of copper delivered (“Mount Milligan Streaming Arrangement”).
Using an assumed market gold price of $1,850 per ounce and a
blended copper price of $3.85 per pound for the remaining three
months ending December 31, 2023 (unchanged from the previous
guidance), the Mount Milligan Mine’s average realized gold and
copper price for the remaining three months of 2023 would be $1,350
per ounce and $2.98 per pound, respectively, compared to average
realized prices of $1,404 per ounce and $3.01 per pound in the nine
months ended September 30, 2023, when factoring in the Mount
Milligan Streaming Arrangement and concentrate refining and
treatment costs. The blended copper price of $3.85 per pound
factors in copper hedges in place as of September 30, 2023 and a
market price of $3.70 per pound for the unhedged portion for the
remainder of 2023 (unchanged from the previous guidance).
- Gold and copper production at the
Mount Milligan Mine assumes recoveries of 66% and 81%,
respectively, which is unchanged from the previous guidance. Gold
production at the Öksüt Mine assumes recoveries of approximately
72%. 2023 gold ounces and copper pounds sold are expected to
approximate production figures.
- Unit costs include a credit for
forecasted copper sales treated as by-product for all-in sustaining
costsNG and all-in costsNG. Production for copper and gold reflects
estimated metallurgical losses resulting from handling of the
concentrate and metal deductions levied by smelters.
- Units noted as ($/oz) relate to
gold ounces and ($/lb) relate to copper pounds.
- Represents non-sustaining capital
expendituresNG at the Goldfield Project.
|
|
2023 Guidance - updated |
Nine Months 2023 results |
2023 Guidance - previous |
Project Evaluation and Exploration Costs(1) |
|
|
|
|
Goldfield Project - Project Evaluation Costs |
($M) |
12 - 17 |
12.5 |
15 - 20 |
Goldfield Project - Exploration Costs |
($M) |
19 - 23 |
21.0 |
16 - 20 |
Thompson Creek Mine - Project Evaluation Costs |
($M) |
12 - 13 |
7.6 |
9 - 10 |
Mount Milligan Mine |
($M) |
7 - 9 |
5.4 |
7 - 9 |
Öksüt Mine |
($M) |
1 - 2 |
1.3 |
1 - 2 |
Other - Greenfield and Generative(2) |
($M) |
13 - 16 |
14.3 |
16 - 19 |
Total Project Evaluation and Exploration Costs |
($M) |
64 - 80 |
62.1 |
64 - 80 |
Other Costs |
|
|
|
|
Kemess Project |
($M) |
11 - 13 |
8.0 |
15 - 17 |
Corporate Administration Costs(3) |
($M) |
40 - 45 |
33.2 |
40 - 45 |
Stock-based Compensation |
($M) |
8 - 10 |
6.6 |
8 - 10 |
Other Corporate Administration Costs |
($M) |
32 - 35 |
26.6 |
32 - 35 |
Molybdenum BU Cash Used in
Operations(4) |
($M) |
|
|
|
Thompson Creek Mine - Care and Maintenance and Project Evaluation
Expenditures(5) |
($M) |
21 - 23 |
17.0 |
18 - 20 |
Endako Mine - Care and Maintenance and Reclamation
Expenditures |
($M) |
9 - 12 |
3.8 |
12 - 15 |
Langeloth Facility - Working Capital Incremental Investment |
($M) |
15 - 45 |
15.0 |
15 - 45 |
- The exploration and project
evaluation costs include both expensed exploration and project
evaluation costs as well as capitalized exploration costs and
exclude business development expenses. $1.2 million of these
capitalized exploration costs are also included in the full year
2023 sustaining capital expendituresNG at the Mount Milligan Mine,
compared to $1.2 million of capitalized exploration costs at the
Mount Milligan Mine for the nine months ended September 30, 2023.
In addition, $2.9 million of capitalized project evaluation costs
at the Goldfield project are also included in the nine months ended
September 30, 2023 and full year 2023 sustaining capital
expendituresNG.
- Other exploration category includes
exploration costs at the Oakley exploration property in Idaho, USA
with $7.3 million actual costs in the nine months ended September
30, 2023.
- 2023 actual costs in the nine
months ended September 30, 2023 include severance costs of
approximately $2.6 million.
- This is a cash-flow based metric as
opposed to cost metrics related to Goldfield Project, Kemess
Project, corporate administration, and other exploration projects
listed in the table above.
- Includes project evaluation costs
listed under total project and exploration costs.
Mount Milligan
Mount Milligan produced 39,554 ounces of gold
and 15.0 million pounds of copper in the third quarter of 2023.
Production in the quarter was impacted by mine sequencing. While
most of the ore-waste transition material was mined in the first
half of 2023, some residual ore-waste transition material was mined
in the third quarter 2023. In addition, recoveries were impacted by
the elevated ratio of pyrite to chalcopyrite from blending low
grade gold, high grade copper ore mined in phase 9 with high grade
gold, low grade copper ore mined in phase 7. The Company expects
medium-term recoveries for gold and copper to be similar to those
achieved in 2023. The Company is currently undertaking additional
metallurgical reviews aimed at increasing recoveries from current
levels.
During the third quarter of 2023, mining
activities were carried out in phases 5, 6, 7, and 9 of the open
pit. A total of 13.4 million tonnes were mined in the third quarter
of 2023. Process plant throughput for the third quarter of 2023 was
5.6 million tonnes and averaged 60,927 tonnes per day.
Mount Milligan’s gold production guidance has
been lowered to 150,000 to 160,000 ounces, from 160,000 to 170,000
ounces previously. This is mainly due to mine sequencing and lower
than planned gold recoveries from the elevated ratio of pyrite to
chalcopyrite as discussed above. Processing a portion of the
elevated pyrite bearing high grade gold, low grade copper ore mined
in phase 7 is expected to be deferred to 2024 for blending
purposes, which is expected to result in overall higher gold grades
in 2024. Copper production of 60 to 70 million pounds remains
unchanged but is expected to be near the low end of the guidance
range. In 2024, the Company anticipates higher levels of gold
production and similar levels of copper production compared to 2023
production guidance levels.
Gold production costs in the third quarter 2023
were $1,050 per ounce, a decrease from the second quarter 2023,
driven by higher gold ounces sold. AISC on a by-product basisNG was
$1,150 per ounce, a decrease from the second quarter 2023, driven
by lower gold production costs per ounce and higher by-product
credits as a result of higher realized copper prices.
As a result of Mount Milligan’s reduced gold
production outlook, full year 2023 gold production costs have been
increased and are now expected to be $1,050 to $1,100 per ounce, up
from $1,000 to $1,050 per ounce previously. Full year 2023 AISC on
a by-product basisNG guidance at Mount Milligan has also been
increased and is now expected to be $1,175 to $1,225 per ounce, up
from $1,125 to $1,175 per ounce previously. A full asset
optimization review has been launched, with the assistance of a
third-party consultant, which includes assessments of occupational
health and safety (“OH&S”), productivity and cost efficiency
opportunities in concert with mine plan optimization. This review
is designed to identify and drive incremental improvements in the
mine’s operations and is expected to be completed in 2024.
Öksüt
Öksüt produced 86,667 ounces of gold in the
third quarter of 2023. During the quarter, mining activities were
focused on stripping and waste removal from phase 5 and phase 6 of
the Keltepe pit, with some activities carried out in phase 2 of the
Güneytepe pit. In the third quarter 2023, a total of 3.1 million
tonnes were mined and 1.0 million tonnes were stacked at an average
grade of 1.98 g/t, containing 62,332 ounces of gold. As at
September 30, 2023, all the stored gold-in-carbon inventory had
been processed. The mine continues to draw down high grade
inventory from the stockpiles and to leach previously stacked high
grade inventory on the heap leach pad. These ounces are expected to
be processed in the coming months and into the first half of
2024.
Full year 2023 production guidance at Öksüt has
been increased to 190,000 to 200,000 ounces of gold, up from
180,000 to 190,000 ounces previously, as a result of a successful
ramp-up of production in the third quarter of 2023.
Gold production costs and AISC on a by-product
basisNG for the third quarter 2023 were $445 per ounce and $582 per
ounce, respectively. As a result of Öksüt’s increased gold
production outlook, full year 2023 gold production costs are now
expected to be in the range of $425 to $475 per ounce, down from
$450 to $500 per ounce previously. Full year 2023 AISC on a
by-product basisNG guidance at Öksüt has also been lowered and is
now expected to be $625 to $675 per ounce, down from $650 to $700
per ounce previously.
Molybdenum Business Unit
In the third quarter 2023, the Molybdenum
Business Unit sold 2.7 million pounds of molybdenum, generating
revenue of $67.7 million with an average realized price of $24.08
per pound. In the first quarter of 2023, the Langeloth Facility
required a $67 million investment in working capital to finance its
business due to a rapid increase in molybdenum prices.
Approximately $52 million of the investment in working capital has
been released in the second and third quarters of 2023.
Intention to Renew NCIB
Subject to the approval of the approval of the
TSX, Centerra intends to proceed with a renewal of a NCIB to
purchase for cancellation up to an aggregate of 18,293,896 Common
Shares, representing 10% of the public float. As of October 31,
2023, Centerra had 215,807,212 issued and outstanding Common
Shares.
Centerra believes that the Common Shares
continue to be trading in a price range which does not adequately
reflect the value of such shares in relation to Centerra’s assets
and its future prospects. As a result, Centerra believes that the
NCIB will provide the Company with a flexible tool to deploy a
portion of its cash balance pursuant to its capital allocation
framework to, depending upon future Common Share price movements
and other factors, purchase Common Shares for cancellation while
preserving its strong balance sheet position.
Centerra has filed a notice of intention to
renew a NCIB with the TSX and, subject to the approval of the TSX,
Centerra may purchase Common Shares under the NCIB over a
twelve-month period. Once the NCIB is commenced, the exact timing
and amount of any purchases will depend on market conditions and
other factors. Centerra will not be obligated to acquire any Common
Shares and may suspend or discontinue purchases under the NCIB at
any time. Any purchases made under the NCIB will be made at market
price at the time of purchase through the facilities of the TSX
and/or alternative Canadian trading systems in accordance with
applicable securities laws and stock exchange rules. The Company’s
previous NCIB authorized the purchase of up to 15,610,813 Common
Shares and expired on October 12, 2023. During the period when that
program operated, a total of 5,298,200 Common Shares of the Company
were repurchased through the facilities of the TSX and alternative
Canadian trading systems at a volume weighted average price of
C$7.44 per Common Share. Centerra intends to establish an automatic
share purchase plan in connection with its renewed NCIB to
facilitate the purchase of Common Shares during times when Centerra
would ordinarily not be permitted to purchase Common Shares due to
regulatory restrictions or self-imposed black-out periods. Before
entering a black-out period, Centerra may, but is not required to,
instruct its designated broker to make purchases under the NCIB
based on parameters set by Centerra in accordance with the
automatic share purchase plan, applicable securities laws and stock
exchange rules.
Conference Call Details
Centerra invites you to join its 2023 third
quarter conference call on Wednesday, November 1, 2023 at 9:00am
Eastern Time. The call is open to all investors and the media. To
join the call, please use the dial-in details found below. To
access the webcast, please use the following link:
https://services.choruscall.ca/links/centerragold2023q3.html
Presentation slides will be available on
Centerra’s website at www.centerragold.com.
Conference Call |
Replay |
Date & Time: November 1, 2023 at 9:00 am Eastern |
Toll-free: 1-855-669-9658 |
Toll-free NA: 1-800-319-4610 |
International: 412-317-0088 |
International: 604-638-5340 |
Passcode: 0473 |
For detailed information on the results
contained within this release, please refer to the Company’s
Management’s Discussion and Analysis ("MD&A") and financial
statements for the quarter ended September 30, 2023 that are
available on the Company’s website www.centerragold.com or
SEDAR at www.sedar.com.
About Centerra
Centerra Gold Inc. is a Canadian-based mining
company focused on operating, developing, exploring and acquiring
gold and copper properties in North America, Türkiye, and other
markets worldwide. Centerra operates two mines: the Mount Milligan
Mine in British Columbia, Canada, and the Öksüt Mine in Türkiye.
The Company also owns the Goldfield Project in Nevada, United
States, the Kemess Underground Project in British Columbia, Canada,
and owns and operates the Molybdenum Business Unit in the United
States and Canada. Centerra's shares trade on the Toronto Stock
Exchange (“TSX”) under the symbol CG and on the New York Stock
Exchange (“NYSE”) under the symbol CGAU. The Company is based in
Toronto, Ontario, Canada.
For more information:
Lisa WilkinsonVice President, Investor Relations & Corporate
Communications(416) 204-3780lisa.wilkinson@centerragold.com
Shae FrosstManager, Investor Relations(416)
204-2159shae.frosst@centerragold.com
Additional information on Centerra is available on the
Company’s website at www.centerragold.com and at
SEDAR at www.sedar.com and EDGAR at www.sec.gov/edgar.
Caution Regarding Forward-Looking
Information:
Information contained in this document which is
not a statement of historical fact, and the documents incorporated
by reference herein, may be “forward-looking information” for the
purposes of Canadian securities laws and within the meaning of the
United States Private Securities Litigation Reform Act of 1995.
Such forward-looking information involves risks, uncertainties and
other factors that could cause actual results, performance,
prospects and opportunities to differ materially from those
expressed or implied by such forward-looking information. The words
“assume”, “anticipate”, “believe”, “budget”, “contemplate”,
“continue”, “de-risk”, “estimate”, “expand”, “expect”, “explore”,
“forecast”, “future”, “in line”, “intend”, “may”, “on track”,
“optimize”, “plan”, "potential", “restart”, “result”, “schedule”,
“seek”, “subject to”, “target”, “understand”, “update”, “will”, and
similar expressions identify forward-looking information. These
forward-looking statements relate to, among other things:
statements regarding 2023 Outlook and 2023 Guidance, including
production, costs, capital expenditures, depreciation, depletion
and amortization, taxes and cash flows; the expected profile of the
Company’s future production and costs, including expectations that
the Mount Milligan Mine is on track to access higher grades in
2024, plans and expectations for a ramp-up of gold processing at
the Öksüt Mine, including cash processing costs for Öksüt Mine’s
gold in carbon inventory and gold in ore stockpiles and on the heap
leach pad, the release of working capital from the Molybdenum
Business Unit, and ongoing evaluations of a restart of the Thompson
Creek Mine.
Forward-looking information is necessarily based
upon a number of estimates and assumptions that, while considered
reasonable by Centerra, are inherently subject to significant
technical, political, business, economic and competitive
uncertainties and contingencies. Known and unknown factors could
cause actual results to differ materially from those projected in
the forward- looking information. Factors and assumptions that
could cause actual results or events to differ materially from
current expectations include, among other things: (A) strategic,
legal, planning and other risks, including: political risks
associated with the Company’s operations in Türkiye, the USA and
Canada; resource nationalism including the management of external
stakeholder expectations; the impact of changes in, or to the more
aggressive enforcement of, laws, regulations and government
practices, including unjustified civil or criminal action against
the Company, its affiliates, or its current or former employees;
risks that community activism may result in increased contributory
demands or business interruptions; the risks related to outstanding
litigation affecting the Company; the impact of any sanctions
imposed by Canada, the United States or other jurisdictions against
various Russian and Turkish individuals and entities; statements
relating to the TSX’s approval of the NCIB; compliance with
applicable laws and regulations pertaining to the NCIB; statements
relating to the TSX’s approval of the NCIB; compliance with
applicable laws and regulations pertaining to the NCIB; potential
defects of title in the Company’s properties that are not known as
of the date hereof; the inability of the Company and its
subsidiaries to enforce their legal rights in certain
circumstances; risks related to anti-corruption legislation;
Centerra not being able to replace mineral reserves; Indigenous
claims and consultative issues relating to the Company’s properties
which are in proximity to Indigenous communities; and potential
risks related to kidnapping or acts of terrorism; (B) risks
relating to financial matters, including: sensitivity of the
Company’s business to the volatility of gold, copper and other
mineral prices; the use of provisionally-priced sales contracts for
production at the Mount Milligan Mine; reliance on a few key
customers for the gold-copper concentrate at the Mount Milligan
Mine; use of commodity derivatives; the imprecision of the
Company’s mineral reserves and resources estimates and the
assumptions they rely on; the accuracy of the Company’s production
and cost estimates; Centerra’s intention to renew the NCIB and the
timing, methods and quantity of any purchases of Common Shares
under the NCIB; the availability of cash for repurchases of Common
Shares under the NCIB; Centerra’s intention to renew the NCIB and
the timing, methods and quantity of any purchases of Common Shares
under the NCIB; the availability of cash for repurchases of Common
Shares under the NCIB; the impact of restrictive covenants in the
Company’s credit facilities which may, among other things, restrict
the Company from pursuing certain business activities or making
distributions from its subsidiaries; changes to tax regimes; the
Company’s ability to obtain future financing; the impact of global
financial conditions; the impact of currency fluctuations; the
effect of market conditions on the Company’s short-term
investments; the Company’s ability to make payments, including any
payments of principal and interest on the Company’s debt
facilities, which depends on the cash flow of its subsidiaries; and
(C) risks related to operational matters and geotechnical issues
and the Company’s continued ability to successfully manage such
matters, including the stability of the pit walls at the Company’s
operations; the integrity of tailings storage facilities and the
management thereof, including as to stability, compliance with
laws, regulations, licenses and permits, controlling seepages and
storage of water, where applicable; the risk of having sufficient
water to continue operations at the Mount Milligan Mine and achieve
expected mill throughput; changes to, or delays in the Company’s
supply chain and transportation routes, including cessation or
disruption in rail and shipping networks, whether caused by
decisions of third-party providers or force majeure events
(including, but not limited to: labour action, flooding, wildfires,
earthquakes, COVID-19, or other global events such as wars); the
success of the Company’s future exploration and development
activities, including the financial and political risks inherent in
carrying out exploration activities; inherent risks associated with
the use of sodium cyanide in the mining operations; the adequacy of
the Company’s insurance to mitigate operational and corporate
risks; mechanical breakdowns; the occurrence of any labour unrest
or disturbance and the ability of the Company to successfully
renegotiate collective agreements when required; the risk that
Centerra’s workforce and operations may be exposed to widespread
epidemic or pandemic; seismic activity, including earthquakes;
wildfires; long lead-times required for equipment and supplies
given the remote location of some of the Company’s operating
properties and disruptions caused by global events; reliance on a
limited number of suppliers for certain consumables, equipment and
components; the ability of the Company to address physical and
transition risks from climate change and sufficiently manage
stakeholder expectations on climate-related issues; the Company’s
ability to accurately predict decommissioning and reclamation costs
and the assumptions they rely upon; the Company’s ability to
attract and retain qualified personnel; competition for mineral
acquisition opportunities; risks associated with the conduct of
joint ventures/partnerships; and, the Company’s ability to manage
its projects effectively and to mitigate the potential lack of
availability of contractors, budget and timing overruns, and
project resources. For additional risk factors, please see section
titled “Risks Factors” in the Company’s most recently filed Annual
Information Form (“AIF”) available on SEDAR at www.sedar.com and
EDGAR at www.sec.gov/edgar.
There can be no assurances that forward-looking
information and statements will prove to be accurate, as many
factors and future events, both known and unknown could cause
actual results, performance or achievements to vary or differ
materially from the results, performance or achievements that are
or may be expressed or implied by such forward-looking statements
contained herein or incorporated by reference. Accordingly, all
such factors should be considered carefully when making decisions
with respect to Centerra, and prospective investors should not
place undue reliance on forward-looking information.
Forward-looking information is as of October 31, 2023. Centerra
assumes no obligation to update or revise forward-looking
information to reflect changes in assumptions, changes in
circumstances or any other events affecting such forward-looking
information, except as required by applicable law.
Non-GAAP and Other Financial Measures
This document contains “specified financial
measures” within the meaning of NI 52-112, specifically the
non-GAAP financial measures, non-GAAP ratios and supplementary
financial measures described below. Management believes that the
use of these measures assists analysts, investors and other
stakeholders of the Company in understanding the costs associated
with producing gold and copper, understanding the economics of gold
and copper mining, assessing operating performance, the Company’s
ability to generate free cash flow from current operations and on
an overall Company basis, and for planning and forecasting of
future periods. However, the measures have limitations as
analytical tools as they may be influenced by the point in the life
cycle of a specific mine and the level of additional exploration or
other expenditures a company has to make to fully develop its
properties. The specified financial measures used in this document
do not have any standardized meaning prescribed by IFRS and may not
be comparable to similar measures presented by other issuers, even
as compared to other issuers who may be applying the World Gold
Council (“WGC”) guidelines. Accordingly, these specified financial
measures should not be considered in isolation, or as a substitute
for, analysis of the Company’s recognized measures presented in
accordance with IFRS.
Definitions
The following is a description of the non-GAAP
financial measures, non-GAAP ratios and supplementary financial
measures used in this document:
- All-in sustaining costs on a
by-product basis per ounce is a non-GAAP ratio calculated as all-in
sustaining costs on a by-product basis divided by ounces of gold
sold. All-in sustaining costs on a by-product basis is a non-GAAP
financial measure calculated as the aggregate of production costs
as recorded in the condensed consolidated statements of (loss)
earnings, refining and transport costs, the cash component of
capitalized stripping and sustaining capital expenditures, lease
payments related to sustaining assets, corporate general and
administrative expenses, accretion expenses, asset retirement
depletion expenses, copper and silver revenue and the associated
impact of hedges of by-product sales revenue. When calculating
all-in sustaining costs on a by-product basis, all revenue received
from the sale of copper from the Mount Milligan Mine, as reduced by
the effect of the copper stream, is treated as a reduction of costs
incurred. A reconciliation of all-in sustaining costs on a
by-product basis to the nearest IFRS measure is set out below.
Management uses these measures to monitor the cost management
effectiveness of each of its operating mines.
- All-in sustaining costs on a
co-product basis per ounce of gold or per pound of copper, is a
non-GAAP ratio calculated as all-in sustaining costs on a
co-product basis divided by ounces of gold or pounds of copper
sold, as applicable. All-in sustaining costs on a co-product basis
is a non-GAAP financial measure based on an allocation of
production costs between copper and gold based on the conversion of
copper production to equivalent ounces of gold. The Company uses a
conversion ratio for calculating gold equivalent ounces for its
copper sales calculated by multiplying the copper pounds sold by
estimated average realized copper price and dividing the resulting
figure by estimated average realized gold price. For the third
quarter ended September 30, 2023, 423 pounds of copper were
equivalent to one ounce of gold. A reconciliation of all-in
sustaining costs on a co-product basis to the nearest IFRS measure
is set out below. Management uses these measures to monitor the
cost management effectiveness of each of its operating mines.
- Sustaining capital expenditures and
Non-sustaining capital expenditures are non-GAAP financial
measures. Sustaining capital expenditures are defined as those
expenditures required to sustain current operations and exclude all
expenditures incurred at new operations or major projects at
existing operations where these projects will materially benefit
the operation. Non-sustaining capital expenditures are primarily
costs incurred at ‘new operations’ and costs related to ‘major
projects at existing operations’ where these projects will
materially benefit the operation. A material benefit to an existing
operation is considered to be at least a 10% increase in annual or
life of mine production, net present value, or reserves compared to
the remaining life of mine of the operation. A reconciliation of
sustaining capital expenditures and non-sustaining capital
expenditures to the nearest IFRS measures is set out below.
Management uses the distinction of the sustaining and
non-sustaining capital expenditures as an input into the
calculation of all-in sustaining costs per ounce and all-in costs
per ounce.
- All-in costs on a by-product basis
per ounce is a non-GAAP ratio calculated as all-in costs on a
by-product basis divided by ounces sold. All-in costs on a
by-product basis is a non-GAAP financial measure which includes
all-in sustaining costs on a by-product basis, exploration and
study costs, non-sustaining capital expenditures, care and
maintenance and other costs. A reconciliation of all-in costs on a
by-product basis to the nearest IFRS measures is set out below.
Management uses these measures to monitor the cost management
effectiveness of each of its operating mines.
- Adjusted net earnings
(loss) is a non-GAAP financial measure calculated by adjusting
net (loss) earnings as recorded in the condensed consolidated
statements of (loss) earnings for items not associated with ongoing
operations. The Company believes that this generally accepted
industry measure allows the evaluation of the results of
income-generating capabilities and is useful in making comparisons
between periods. This measure adjusts for the impact of items not
associated with ongoing operations. A reconciliation of adjusted
net (loss) earnings to the nearest IFRS measures is set out below.
Management uses this measure to monitor and plan for the operating
performance of the Company in conjunction with other data prepared
in accordance with IFRS.
- Free cash flow (deficit) is a
non-GAAP financial measure calculated as cash provided by operating
activities from continuing operations less property, plant and
equipment additions. A reconciliation of free cash flow to the
nearest IFRS measures is set out below. Management uses this
measure to monitor the amount of cash available to reinvest in the
Company and allocate for shareholder returns.
- Free cash flow (deficit) from mine
operations is a non-GAAP financial measure calculated as cash
provided by mine operations less property, plant and equipment
additions. A reconciliation of free cash flow from mine operations
to the nearest IFRS measures is set out below. Management uses this
measure to monitor the degree of self-funding of each of its
operating mines and facilities.
Certain unit costs, including all-in
sustaining costs on a by-product basis (including and excluding
revenue-based taxes) per ounce, are non-GAAP ratios which include
as a component certain non-GAAP financial measures including all-in
sustaining costs on a by-product basis which can be reconciled as
follows:
|
Three months ended September 30, |
|
Consolidated |
Mount Milligan |
Öksüt |
(Unaudited - $millions, unless otherwise
specified) |
2023 |
|
2022 |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Production costs attributable to gold |
84.2 |
|
41.0 |
|
45.0 |
|
41.0 |
|
39.2 |
|
— |
Production costs attributable to copper |
35.4 |
|
29.7 |
|
35.4 |
|
29.7 |
|
— |
|
— |
Total
production costs excluding Molybdenum BU segment, as reported |
119.6 |
|
70.7 |
|
80.4 |
|
70.7 |
|
39.2 |
|
— |
Adjust
for: |
|
|
|
|
|
|
Third
party smelting, refining and transport costs |
2.8 |
|
2.4 |
|
2.4 |
|
2.4 |
|
0.4 |
|
— |
By-product and co-product credits |
(48.2 |
) |
(50.5 |
) |
(47.9 |
) |
(50.5 |
) |
(0.3 |
) |
— |
Adjusted
production costs |
74.2 |
|
22.6 |
|
34.9 |
|
22.6 |
|
39.3 |
|
— |
Corporate
general administrative and other costs |
7.7 |
|
11.7 |
|
— |
|
0.1 |
|
— |
|
— |
Reclamation and remediation - accretion (operating sites) |
2.3 |
|
1.8 |
|
0.6 |
|
0.2 |
|
1.7 |
|
1.6 |
Sustaining capital expenditures |
22.6 |
|
15.4 |
|
12.5 |
|
10.4 |
|
10.1 |
|
5.0 |
Sustaining leases |
1.5 |
|
1.4 |
|
1.3 |
|
1.3 |
|
0.2 |
|
0.1 |
All-in
sustaining costs on a by-product basis |
108.3 |
|
52.9 |
|
49.2 |
|
34.6 |
|
51.3 |
|
6.7 |
Exploration and evaluation costs |
16.5 |
|
21.1 |
|
2.9 |
|
3.6 |
|
0.5 |
|
0.8 |
Non-sustaining capital expenditures(1) |
1.1 |
|
0.1 |
|
— |
|
— |
|
— |
|
— |
Care and
maintenance and other costs |
2.8 |
|
3.3 |
|
— |
|
— |
|
— |
|
0.3 |
All-in
costs on a by-product basis |
128.7 |
|
77.4 |
|
52.1 |
|
38.2 |
|
51.8 |
|
7.8 |
Ounces
sold (000s) |
131.0 |
|
56.2 |
|
42.9 |
|
56.2 |
|
88.1 |
|
— |
Pounds
sold (millions) |
15.4 |
|
19.6 |
|
15.4 |
|
19.6 |
|
— |
|
— |
Gold
production costs ($/oz) |
643 |
|
729 |
|
1,050 |
|
729 |
|
445 |
|
n/a |
All-in
sustaining costs on a by-product basis ($/oz) |
827 |
|
941 |
|
1,150 |
|
615 |
|
582 |
|
n/a |
All-in
costs on a by-product basis ($/oz) |
983 |
|
1,376 |
|
1,218 |
|
679 |
|
586 |
|
n/a |
Gold -
All-in sustaining costs on a co-product basis ($/oz) |
858 |
|
1,190 |
|
1,245 |
|
865 |
|
582 |
|
n/a |
Copper
production costs ($/pound) |
2.30 |
|
1.51 |
|
2.30 |
|
1.51 |
|
n/a |
|
n/a |
Copper - All-in sustaining costs on a co-product basis
($/pound) |
2.73 |
|
1.78 |
|
2.73 |
|
1.78 |
|
n/a |
|
n/a |
(1) Non-sustaining capital expenditures are
distinct projects designed to have a significant increase in the
net present value of the mine. In the current quarter,
non-sustaining capital expenditures include costs related to the
installation of the staged flotation reactors at the Mount Milligan
Mine.
Certain unit costs, including all-in
sustaining costs on a by-product basis (including and excluding
revenue-based taxes) per ounce, are non-GAAP ratios which include
as a component certain non-GAAP financial measures including all-in
sustaining costs on a by-product basis which can be reconciled as
follows:
|
Nine months ended September 30, |
|
Consolidated |
Mount Milligan |
Öksüt |
(Unaudited - $millions, unless otherwise
specified) |
2023 |
|
2022 |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Production costs attributable to gold |
178.8 |
|
125.9 |
|
135.3 |
|
104.8 |
|
43.5 |
|
21.1 |
Production costs attributable to copper |
106.0 |
|
94.3 |
|
106.0 |
|
94.3 |
|
— |
|
— |
Total
production costs excluding molybdenum segment, as reported |
284.8 |
|
220.2 |
|
241.3 |
|
199.1 |
|
43.5 |
|
21.1 |
Adjust
for: |
|
|
|
|
|
|
Third
party smelting, refining and transport costs |
7.8 |
|
8.6 |
|
7.4 |
|
8.4 |
|
0.4 |
|
0.2 |
By-product and co-product credits |
(137.5 |
) |
(169.5 |
) |
(137.2 |
) |
(169.5 |
) |
(0.3 |
) |
— |
Adjusted
production costs |
155.1 |
|
59.3 |
|
111.5 |
|
38.0 |
|
43.6 |
|
21.3 |
Corporate
general administrative and other costs |
32.8 |
|
35.7 |
|
0.1 |
|
0.6 |
|
— |
|
— |
Reclamation and remediation - accretion (operating sites) |
4.3 |
|
5.4 |
|
1.8 |
|
1.3 |
|
2.5 |
|
4.1 |
Sustaining capital expenditures |
48.1 |
|
54.6 |
|
27.6 |
|
43.2 |
|
20.5 |
|
11.4 |
Sustaining lease payments |
4.3 |
|
4.3 |
|
3.8 |
|
3.9 |
|
0.5 |
|
0.4 |
All-in
sustaining costs on a by-product basis |
244.6 |
|
159.3 |
|
144.8 |
|
87.0 |
|
67.1 |
|
37.2 |
Exploration and study costs |
50.4 |
|
42.6 |
|
4.2 |
|
10.1 |
|
1.3 |
|
2.5 |
Non-sustaining capital expenditures |
2.9 |
|
2.0 |
|
— |
|
1.5 |
|
— |
|
— |
Care and
maintenance and other costs |
23.0 |
|
9.1 |
|
— |
|
— |
|
14.2 |
|
0.4 |
All-in
costs on a by-product basis |
320.9 |
|
213.0 |
|
149.0 |
|
98.6 |
|
82.6 |
|
40.1 |
Ounces
sold (000s) |
218.1 |
|
192.7 |
|
119.3 |
|
138.0 |
|
98.8 |
|
54.7 |
Pounds
sold (millions) |
43.5 |
|
58.0 |
|
43.5 |
|
58.0 |
|
— |
|
— |
Gold
production costs ($/oz) |
820 |
|
653 |
|
1,134 |
|
759 |
|
440 |
|
386 |
All-in
sustaining costs on a by-product basis ($/oz) |
1,122 |
|
826 |
|
1,214 |
|
629 |
|
679 |
|
680 |
All-in
costs on a by-product basis ($/oz) |
1,471 |
|
1,105 |
|
1,249 |
|
713 |
|
836 |
|
732 |
Gold -
All-in sustaining costs on a co-product basis ($/oz) |
1,168 |
|
1,062 |
|
1,300 |
|
958 |
|
679 |
|
680 |
Copper
production costs ($/pound) |
2.43 |
|
1.63 |
|
2.43 |
|
1.63 |
|
n/a |
|
n/a |
Copper - All-in sustaining costs on a co-product basis
($/pound) |
2.78 |
|
2.04 |
|
2.78 |
|
2.04 |
|
n/a |
|
n/a |
Adjusted net earnings (loss) is
a non-GAAP financial measure and can be reconciled as
follows:
|
Three months ended September 30, |
Nine months ended September 30, |
($millions, except as noted) |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Net earnings (loss) |
$ |
60.6 |
|
$ |
(33.9 |
) |
$ |
(52.5 |
) |
$ |
52.9 |
|
Adjust
for items not associated with ongoing operations: |
|
|
|
|
Kumtor
Mine legal costs and other related costs |
|
— |
|
|
5.3 |
|
|
— |
|
|
15.0 |
|
Reclamation recovery at the Molybdenum BU sites and the Kemess
Project |
|
(23.1 |
) |
|
(7.7 |
) |
|
(15.8 |
) |
|
(90.8 |
) |
Income
and mining tax adjustments(1) |
|
9.2 |
|
|
20.4 |
|
|
19.9 |
|
|
27.2 |
|
Unrealized foreign exchange gain(2) |
|
(2.3 |
) |
|
— |
|
|
(2.3 |
) |
|
— |
|
Adjusted net earnings (loss) |
$ |
44.4 |
|
$ |
(15.9 |
) |
$ |
(50.7 |
) |
$ |
4.3 |
|
|
|
|
|
|
Net earnings (loss) per share - basic |
$ |
0.28 |
|
$ |
(0.14 |
) |
$ |
(0.24 |
) |
$ |
0.19 |
|
Net earnings (loss) per share - diluted |
$ |
0.27 |
|
$ |
(0.15 |
) |
$ |
(0.25 |
) |
$ |
0.17 |
|
Adjusted net earnings (loss) per share -
basic |
$ |
0.20 |
|
$ |
(0.06 |
) |
$ |
(0.23 |
) |
$ |
0.02 |
|
Adjusted net earnings (loss) per share -
diluted |
$ |
0.20 |
|
$ |
(0.06 |
) |
$ |
(0.23 |
) |
$ |
0.02 |
|
(1) Income tax adjustments reflect the
impact of a one-time income tax levied by the Turkish government
and impact of foreign currency translation on deferred income taxes
at the Öksüt Mine and the Mount Milligan Mine.
(2) Effect of the foreign exchange movement
on the reclamation provision at the Endako Mine and Kemess
Project.
Free cash flow (deficit) is a
non-GAAP financial measure and can be reconciled as
follows:
|
Three months ended September 30, |
|
Consolidated |
Mount Milligan |
Öksüt |
Molybdenum |
Other |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Cash provided by (used in) operating
activities(1) |
$ |
166.6 |
|
$ |
(17.0 |
) |
$ |
35.6 |
|
$ |
33.4 |
|
$ |
143.9 |
|
$ |
(18.0 |
) |
$ |
9.2 |
|
$ |
8.0 |
|
$ |
(22.1 |
) |
$ |
(40.4 |
) |
Deduct: |
|
|
|
|
|
|
|
|
|
|
Property, plant & equipment additions(1) |
|
(22.1 |
) |
|
(18.5 |
) |
|
(10.4 |
) |
|
(12.5 |
) |
|
(10.1 |
) |
|
(5.0 |
) |
|
(0.4 |
) |
|
(0.8 |
) |
|
(1.2 |
) |
|
(0.2 |
) |
Free cash flow (deficit) |
$ |
144.5 |
|
$ |
(35.5 |
) |
$ |
25.2 |
|
$ |
20.9 |
|
$ |
133.8 |
|
$ |
(23.0 |
) |
$ |
8.8 |
|
$ |
7.2 |
|
$ |
(23.3 |
) |
$ |
(40.6 |
) |
(1) As presented in the Company’s condensed
consolidated statements of cash flows.
|
Nine months ended September 30, |
|
Consolidated |
Mount Milligan |
Öksüt |
Molybdenum |
Other |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Cash provided by (used in) operating
activities(1) |
$ |
100.2 |
|
$ |
7.8 |
|
$ |
84.8 |
|
$ |
135.1 |
|
$ |
130.8 |
|
$ |
(5.6 |
) |
$ |
(36.7 |
) |
$ |
(17.9 |
) |
$ |
(78.7 |
) |
$ |
(103.8 |
) |
Deduct: |
|
|
|
|
|
|
|
|
|
|
Property, plant & equipment additions(1) |
|
(51.0 |
) |
|
(65.4 |
) |
|
(26.2 |
) |
|
(50.3 |
) |
|
(20.5 |
) |
|
(11.4 |
) |
|
(0.5 |
) |
|
(1.1 |
) |
|
(3.8 |
) |
|
(2.6 |
) |
Free cash flow (deficit) |
$ |
49.2 |
|
$ |
(57.6 |
) |
$ |
58.6 |
|
$ |
84.8 |
|
$ |
110.3 |
|
$ |
(17.0 |
) |
$ |
(37.2 |
) |
$ |
(19.0 |
) |
$ |
(82.5 |
) |
$ |
(106.4 |
) |
(1) As presented in the Company’s condensed
consolidated statements of cash flows.
Sustaining capital expenditures
and non-sustaining capital expenditures are non-GAAP measures and
can be reconciled as follows:
|
Three months ended September 30, |
|
Consolidated |
Mount Milligan |
Öksüt |
Molybdenum |
Other |
|
|
2023 |
|
|
2022 |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
2023 |
|
2022 |
|
2023 |
|
|
2022 |
|
Additions to PP&E(1) |
$ |
24.9 |
|
$ |
11.7 |
$ |
9.2 |
|
$ |
6.6 |
|
$ |
12.7 |
|
$ |
4.0 |
$ |
0.5 |
$ |
0.5 |
$ |
2.5 |
|
$ |
0.6 |
|
Adjust
for: |
|
|
|
|
|
|
|
|
|
|
Costs capitalized to the ARO assets |
|
1.8 |
|
|
4.2 |
|
3.1 |
|
|
4.0 |
|
|
(1.3 |
) |
|
0.7 |
|
— |
|
— |
|
— |
|
|
(0.5 |
) |
Costs capitalized to the ROU assets |
|
(2.8 |
) |
|
— |
|
(0.2 |
) |
|
— |
|
|
(1.2 |
) |
|
— |
|
— |
|
— |
|
(1.4 |
) |
|
— |
|
Costs relating to the acquisition of Goldfield Project |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
— |
|
— |
|
— |
|
|
— |
|
Other(2) |
|
0.7 |
|
|
0.2 |
|
0.4 |
|
|
(0.2 |
) |
|
(0.1 |
) |
|
0.4 |
|
— |
|
— |
|
0.4 |
|
|
— |
|
Capital expenditures |
$ |
24.6 |
|
$ |
16.1 |
$ |
12.5 |
|
$ |
10.4 |
|
$ |
10.1 |
|
$ |
5.1 |
$ |
0.5 |
$ |
0.5 |
$ |
1.5 |
|
$ |
0.1 |
|
Sustaining capital expenditures |
|
23.5 |
|
|
16.0 |
|
12.5 |
|
|
10.4 |
|
|
10.1 |
|
|
5.1 |
|
0.5 |
|
0.5 |
|
0.4 |
|
|
0.1 |
|
Non-sustaining capital expenditures |
|
1.1 |
|
|
0.1 |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
— |
|
— |
|
1.1 |
|
|
0.1 |
|
(1) As presented in note 14 of the
Company’s condensed consolidated financial
statements.(2) Includes reclassification of insurance and
capital spares from supplies inventory to PP&E.
|
Nine months ended September 30, |
|
Consolidated |
Mount Milligan |
Öksüt |
Molybdenum |
Other |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
2023 |
|
|
2022 |
|
|
2023 |
|
2022 |
|
2023 |
|
|
2022 |
|
Additions to PP&E(1) |
$ |
53.8 |
|
$ |
247.2 |
|
$ |
25.4 |
|
$ |
34.6 |
$ |
23.4 |
|
$ |
9.1 |
|
$ |
0.6 |
$ |
1.0 |
$ |
4.4 |
|
$ |
202.5 |
|
Adjust
for: |
|
|
|
|
|
|
|
|
|
|
Costs capitalized to the ARO assets |
|
1.0 |
|
|
18.1 |
|
|
2.5 |
|
|
9.9 |
|
(1.5 |
) |
|
1.90 |
|
|
— |
|
— |
|
— |
|
|
6.3 |
|
Costs capitalized to the ROU assets |
|
(2.7 |
) |
|
(0.2 |
) |
|
(0.1 |
) |
|
— |
|
(1.2 |
) |
|
(0.2 |
) |
|
— |
|
— |
|
(1.4 |
) |
|
— |
|
Costs relating to the acquisition of Goldfield Project |
|
— |
|
|
(208.2 |
) |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
— |
|
— |
|
|
(208.2 |
) |
Other(2) |
|
(0.2 |
) |
|
0.9 |
|
|
(0.2 |
) |
|
0.2 |
|
(0.2 |
) |
|
0.6 |
|
|
— |
|
0.1 |
|
0.2 |
|
|
— |
|
Capital expenditures |
$ |
51.9 |
|
$ |
57.8 |
|
$ |
27.6 |
|
$ |
44.7 |
$ |
20.5 |
|
$ |
11.4 |
|
$ |
0.6 |
$ |
1.1 |
$ |
3.2 |
|
$ |
0.6 |
|
Sustaining capital expenditures |
|
49.0 |
|
|
55.8 |
|
|
27.6 |
|
|
43.2 |
|
20.5 |
|
|
11.4 |
|
|
0.6 |
|
1.1 |
|
0.3 |
|
|
0.1 |
|
Non-sustaining capital expenditures |
|
2.9 |
|
|
2.0 |
|
|
— |
|
|
1.5 |
|
— |
|
|
— |
|
|
— |
|
— |
|
2.9 |
|
|
0.5 |
|
(1) As presented in note 14 of the
Company’s condensed consolidated financial
statements.(2) Includes reclassification of insurance and
capital spares from supplies inventory to PP&E.
Centerra Gold (NYSE:CGAU)
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