Equinox Gold Reports First Quarter 2024 Financial and Operating Results
Equinox Gold Corp. reports first quarter 2024 financial and operating results, highlighting 111,725 ounces of gold produced, $1,567 cash costs per oz, and $1,950 AISC per oz. The company announced acquiring 100% ownership of Greenstone Mine and provided 2024 production and cost guidance. The recent developments include advancing Greenstone commissioning and entering a binding share purchase agreement with Orion Mine Finance Management LP. The Company extended existing convertible notes and reported a geotechnical event at Aurizona. Shareholder events for May 9, 2024, include a conference call, annual meeting, and Corporate Update.
Produced 111,725 ounces of gold with total cash costs of $1,567 per oz and AISC of $1,950 per oz.
Announced acquisition of 100% ownership of Greenstone Mine.
Provided 2024 production guidance of 660,000 to 750,000 ounces of gold at cash costs of $1,340 to $1,445 per oz.
Completed Greenstone commissioning and expects first gold pour in May with commercial production targeted by Q3 2024.
Entered a binding share purchase agreement with Orion Mine Finance Management LP to acquire Orion's 40% interest in Greenstone for $995 million.
Net loss of $42.8 million or $0.13 per share (basic) reported for the first quarter 2024.
Income from mine operations was $11.4 million, lower than $14.5 million in Q1 2023.
Adjusted net loss of $14.4 million or $0.04 per share for the first quarter 2024.
Other expense of $13.9 million in Q1 2024 compared to other income of $31.9 million in Q1 2023.
Cash cost per oz sold and AISC per oz sold were 16% and 18% higher in Q1 2024 compared to Q1 2023.
Insights
All financial figures are in US dollars, unless otherwise indicated.
Vancouver, British Columbia--(Newsfile Corp. - May 8, 2024) - Equinox Gold Corp. (TSX: EQX) (NYSE American: EQX) ("Equinox Gold" or the "Company") is pleased to announce its first quarter 2024 summary financial and operating results. The Company's unaudited condensed consolidated interim financial statements and related management's discussion and analysis ("MD&A") for the three months ended March 31, 2024 will be available for download on the Company's profile on SEDAR+ at www.sedarplus.ca, on EDGAR at www.sec.gov/edgar and on the Company's website at www.equinoxgold.com. The Company will host a conference call and webcast on May 9, 2024 commencing at 7:30 am Pacific Time to discuss first quarter results and activities underway at the Company. The Company will also host its annual meeting of shareholders ("AGM") on May 9 commencing at 1:30 pm Pacific Time followed by a corporate update with Equinox Gold's Chair and executive team commencing at 1:45 pm Pacific Time. Further details are provided at the end of this news release.
Greg Smith, President and CEO of Equinox Gold, commented: "Equinox Gold had a good start to the year. We have continued to achieve strong performance on our safety and environmental targets, and gold production and costs during the quarter have us well positioned to achieve 2024 guidance. We recently announced the acquisition of our joint venture partner's
HIGHLIGHTS FOR THE THREE MONTHS ENDED MARCH 31, 2024
Operational
- Produced 111,725 ounces of gold
- Sold 116,504 ounces of gold at an average realized gold price of
$2,066 per oz - Total cash costs of
$1,567 per oz and AISC of$1,950 per oz(1) - Two lost-time injuries; total recordable injury frequency rate(2) of 1.55 per million hours worked for the 12-month rolling period (1.61 for the Quarter)
- Significant environmental incident frequency rate(2) per million hours worked of 0.30 per million hours worked for the 12-month rolling period (0.00 for the Quarter)
Earnings
- Income from mine operations of
$11.4 million - Net loss of
$42.8 million or$0.13 per share (basic) - Adjusted net loss of
$14.4 million or$0.04 per share(1)
Financial
- Cash flow from operations before changes in non-cash working capital of
$47.7 million ($17.9 million after changes in non-cash working capital) - Adjusted EBITDA of
$52.2 million (1) - Sustaining expenditures of
$44.6 million and non-sustaining expenditures of$69.3 million
Corporate
- Provided 2024 production and cost guidance of 660,000 to 750,000 ounces of gold at cash costs of
$1,340 t o$1,445 per oz and AISC of$1,630 t o$1,740 per oz(1) - Provided 2024 sustaining and non-sustaining expenditure guidance of
$424 million $212 million of sustaining expenditures, of which$196 million is sustaining capital expenditures(1)$213 million of non-sustaining expenditures, of which$205 million is non-sustaining capital expenditures- Non-sustaining capital expenditures includes
$95 million to advance Greenstone to commercial production
- For the three months ended March 31, 2024, the Company issued 10.9 million common shares under its at-the-market equity program ("ATM Program") at a weighted average share price of
$4.61 per common share for total gross proceeds of$50.2 million
Construction and Development
- Advanced Greenstone commissioning:
- Commissioned crushing circuit, ore storage dome, high-pressure grinding rolls (HPGR), ball mill #1, and thickener and leach tanks; loaded flocculant and lime into the system during last week of March
- More than 1.5 million tonnes of ore stockpiled for startup
- Spent
$54 million (Equinox Gold's60% share) during the Quarter - On track to achieve first gold production in Q2 2024
- Completed approximately 6.4 million hours project-to-date with one lost-time injury; 12-month rolling average TRIFR of 2.03
RECENT DEVELOPMENTS
- Commenced processing ore at Greenstone
- Ore introduced into the grinding circuit on April 6, 2024
- First gold pour expected in May, commercial production targeted by the end of Q3 2024
- On April 23, 2024, the Company announced it had entered into a binding share purchase agreement ("SPA") with certain funds managed by Orion Mine Finance Management LP ("Orion") to acquire Orion's
40% interest in Greenstone Gold Mine GP Inc. (the "Transaction"), giving Equinox Gold100% ownership of Greenstone- Equinox Gold will pay
$995 million to acquire Orion's40% interest in Greenstone, payable as: a) 42 million common shares of Equinox Gold valued at$250 million ; b)$705 million in cash payable on closing; and c)$40 million cash payable by December 31, 2024 - Equinox Gold will fund the cash consideration with net proceeds from a new
$500 million three-year term loan and a bought deal equity financing of 49,060,000 common shares of Equinox Gold at a price of$5.30 per common share (the "Offering") for aggregate gross proceeds of approximately$260 million - The
$500 million term loan will include a requirement that Equinox Gold hedge15% of anticipated gold production through mid-2026 - On April 26, 2024, the Company announced that the Offering, including an over-allotment option, has closed and the Company has issued 56,419,000 common shares for aggregate gross proceeds of
$299 million - The Transaction is expected to close in Q2 2024, subject to customary closing conditions and receipt of certain regulatory and other approvals
- Equinox Gold will pay
- Subsequent to March 31, 2024, extended existing 2019 and 2020 convertible notes
- Maturity date of the
$139.7 million principal5.00% convertible notes due April 12, 2024 (the "2019 Convertible Notes") extended by six months to October 12, 2024 - Maturity date of the
$139.3 million principal4.75% convertible notes due March 10, 2025 (the "2020 Convertible Notes") extended by six months to September 10, 2025 and conversion price amended from$7.80 t o$6.50
- Maturity date of the
- On April 8, 2024, the Company reported a geotechnical event at Aurizona and a pause of mining activities while the Company establishes a remediation plan; milling and gold production continued from the ore stockpile through April. Subsequently, the Company commenced mining of the Tatajuba open pit at Aurizona and anticipates a ramp-up of mining activities to produce ore for plant feed by June 2024
- On April 9, 2024, the Company drew down
$60.0 million on the Company's revolving credit facility (the "Revolving Facility")
_____________________________
(1) Cash costs per oz sold, AISC per oz sold, sustaining capital, sustaining expenditures, adjusted net income, adjusted EBITDA, adjusted EPS, and net debt are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.
(2) Total recordable injury frequency rate ("TRIFR") and significant environmental incident frequency rate ("SEIFR") are both reported per million hours worked. TRIFR is the total number of injuries excluding those requiring simple first aid treatment.
CONSOLIDATED OPERATIONAL AND FINANCIAL HIGHLIGHTS
| Three months ended | ||||||||||
| Operating data | Unit | March 31, 2024 | December 31, 2023 | March 31, 2023 | ||||||
| Gold produced | oz | 111,725 | 154,960 | 122,746 | ||||||
| Gold sold | oz | 116,504 | 149,861 | 123,295 | ||||||
| Average realized gold price | $/oz | 2,066 | 1,983 | 1,895 | ||||||
| Cash costs per oz sold(1)(2) | $/oz | 1,567 | 1,330 | 1,346 | ||||||
| AISC per oz sold(1)(2) | $/oz | 1,950 | 1,657 | 1,658 | ||||||
| Financial data | ||||||||||
| Revenue | M$ | 241.3 | 297.8 | 234.1 | ||||||
| Income from mine operations | M$ | 11.4 | 38.6 | 14.5 | ||||||
| Net income (loss) | M$ | (42.8 | ) | 3.9 | 17.4 | |||||
| Net income (loss) per share (basic) | $/share | (0.13 | ) | 0.01 | 0.06 | |||||
| Adjusted EBITDA(1) | M$ | 52.2 | 95.3 | 57.0 | ||||||
| Adjusted net income (loss)(1) | M$ | (14.4 | ) | 2.4 | (8.2 | ) | ||||
| Adjusted EPS(1) | $/share | (0.04 | ) | 0.01 | (0.03 | ) | ||||
| Balance sheet and cash flow data | ||||||||||
| Cash and cash equivalents (unrestricted) | M$ | 125.3 | 192.0 | 284.9 | ||||||
| Net debt(1) | M$ | 803.9 | 733.0 | 547.8 | ||||||
| Operating cash flow before changes in non-cash working capital | M$ | 47.7 | 168.2 | 195.4 | ||||||
(1) Cash costs per oz sold, AISC per oz sold, adjusted EBITDA, adjusted net loss, adjusted EPS and net debt are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.
(2) Consolidated AISC per oz sold excludes corporate general and administration expenses.
(3) Numbers in tables throughout this news release may not sum due to rounding.
Gold ounces sold in Q1 2024 were
Revenue was higher in Q1 2024 compared to Q1 2023 primarily due to a
Cash cost per oz sold and AISC per oz sold were
In Q1 2024, income from mine operations was
The net loss for Q1 2024 was
In Q1 2024, adjusted EBITDA was
Sustaining and non-sustaining expenditures totaled
SELECTED FINANCIAL RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND 2023
| $ amounts in millions, except per share amounts | | Three months ended | ||||
| March 31, 2024 | March 31, 2023 | | ||||
| Revenue | $ | 241.3 | $ | 234.1 | ||
| Cost of sales | ||||||
| Operating expense | (183.8 | ) | (172.2 | ) | ||
| Depreciation and depletion | (46.2 | ) | (47.4 | ) | ||
| Income from mine operations | 11.4 | 14.5 | ||||
| Care and maintenance expense | - | (1.1 | ) | |||
| Exploration and evaluation expense | (2.5 | ) | (1.8 | ) | ||
| General and administration expense | (14.1 | ) | (9.9 | ) | ||
| Income (loss) from operations | (5.3 | ) | 1.6 | |||
| Finance expense | (17.4 | ) | (12.7 | ) | ||
| Finance income | 2.0 | 3.0 | ||||
| Share of net income (loss) in associate | 0.4 | (16.0 | ) | |||
| Other income (expense) | (13.9 | ) | 31.9 | |||
| Net income (loss) before taxes | (34.2 | ) | 7.8 | |||
| Income tax recovery (expense) | (8.5 | ) | 9.6 | |||
| Net income (loss) | $ | (42.8 | ) | $ | 17.4 | |
| Net income (loss) per share attributable to Equinox Gold shareholders | ||||||
| Basic | $ | (0.13 | ) | $ | 0.06 | |
| Diluted | $ | (0.13 | ) | $ | 0.05 | |
Additional information regarding the Company's financial and operating results is available in the Company's Q1 2024 Financial Statements and accompanying MD&A for the three months ended March 31, 2024, which will be available for download on the Company's website at www.equinoxgold.com, on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov/edgar.
SHAREHOLDER EVENTS ON MAY 9, 2024
First Quarter Results (May 9, 7:30 am PT)
The Company will host a conference call and webcast on Thursday, May 9, 2024, commencing at 7:30 am PT (10:30 am ET) to discuss first quarter results.
- Conference Call
- Toll-free in U.S. and Canada: 1-844-763-8274
- International callers: +1 647-484-8814
- Webcast
Annual Meeting of Shareholders (May 9, 1:30 pm PT)
The Company's AGM will be held on Thursday, May 9, 2024, commencing at 1:30 pm PT (4:30 pm ET). Shareholders who cannot attend in person are invited to join online.
- Attend in Person
- Suite 3500, 1133 Melville Street, Vancouver, BC
- Attend Online
Corporate Update (May 9, 1:45 pm PT)
Equinox Gold's Chair, Ross Beaty, will host a Corporate Update immediately after the AGM, commencing at approximately 1:45 pm PT (4:45 pm ET), to discuss the Company's business strategy and objectives. Shareholders who have attended the AGM online will need to disconnect from the AGM webcast and login to the Corporate Update webcast at www.equinoxgold.com/shareholder-events.
ABOUT EQUINOX GOLD
Equinox Gold is a growth-focused Canadian mining company with seven operating gold mines, commissioning underway at a new mine, and a path to achieve more than one million ounces of annual gold production from a pipeline of development and expansion projects. Equinox Gold's common shares are listed on the TSX and the NYSE American under the trading symbol EQX. Further information about Equinox Gold's portfolio of assets and long-term growth strategy is available at www.equinoxgold.com or by email at ir@equinoxgold.com.
EQUINOX GOLD CONTACTS
Greg Smith, President & Chief Executive Officer
Rhylin Bailie, Vice President, Investor Relations
Tel: +1 604-558-0560
Email: ir@equinoxgold.com
NON-IFRS MEASURES
This news release refers to cash costs, cash costs per oz sold, AISC, AISC per oz sold, sustaining capital and sustaining expenditures, mine-site free cash flow, AISC contribution margin, adjusted EBITDA, adjusted net income, adjusted EPS and net debt that are measures with no standardized meaning under IFRS, i.e. they are non-IFRS measures, and may not be comparable to similar measures presented by other companies. Their measurement and presentation is consistently prepared and is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Numbers presented in the tables below may not sum due to rounding.
Cash Costs and Cash Costs per oz Sold
Cash costs is a common financial performance measure in the gold mining industry; however, it has no standard meaning under IFRS. The Company reports total cash costs on a per oz sold basis. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company's performance and ability to generate operating income and cash flow from mining operations. Cash costs are calculated as mine site operating costs and are net of silver revenue. Cash costs are divided by ounces sold to arrive at cash costs per oz sold. In calculating cash costs, the Company deducts silver revenue as it considers the cost to produce the gold is reduced as a result of the by-product sales incidental to the gold production process, thereby allowing management and other stakeholders to assess the net costs of gold production. The measure is not necessarily indicative of cash flow from operations under IFRS or operating costs presented under IFRS.
AISC per oz Sold
The Company uses AISC per oz of gold sold to measure performance. The methodology for calculating AISC was developed internally and is calculated below. Current IFRS measures used in the gold industry, such as operating expenses, do not capture all of the expenditures incurred to discover, develop and sustain gold production. The Company believes the AISC measure provides further transparency into costs associated with producing gold and will assist analysts, investors and other stakeholders of the Company in assessing its operating performance, its ability to generate free cash flow from current operations and its overall value. AISC includes cash costs (described above) and also includes sustaining capital expenditures (described in following section), sustaining lease payments, reclamation cost accretion and amortization and exploration and evaluation costs.
This measure seeks to reflect the full cost of gold production from current operations, therefore, expansionary capital and non-sustaining expenditures are excluded.
Prior to Q2 2023, the Company's calculation of cash costs included the principal portion of sustaining lease payments. Commencing in Q2 2023, to improve the comparability of the Company's financial performance measures with its peers and align to the standards outlined by the World Gold Council, the Company has excluded sustaining lease payments from its calculation of cash costs and has included them as a component of AISC. The calculations of cash costs and AISC for comparative periods have been adjusted to conform with the current methodology and are different from the measures previously reported.
The following table provides a reconciliation of cash costs per oz of gold sold and AISC per oz of gold sold to the most directly comparable IFRS measure on an aggregate basis:
| $'s in millions, except ounce and per oz figures | Three months ended | ||||||||
| March 31, 2024 | December 31, 2023 | March 31, 2023 | |||||||
| Operating expenses | 183.8 | 198.2 | 172.2 | ||||||
| Silver revenue | (0.6 | ) | (0.6 | ) | (0.3 | ) | |||
| Fair value adjustment on acquired inventories | (0.6 | ) | 1.6 | (5.9 | ) | ||||
| Total cash costs | $ | 182.6 | $ | 199.3 | $ | 165.9 | |||
| Sustaining capital | 39.0 | 42.7 | 32.5 | ||||||
| Sustaining lease payments | 2.6 | 4.6 | 3.8 | ||||||
| Reclamation expense | 2.8 | 1.7 | 2.2 | ||||||
| Sustaining exploration expense | 0.2 | - | - | ||||||
| Total AISC | $ | 227.2 | $ | 248.3 | $ | 204.4 | |||
| Gold oz sold | 116,504 | 149,861 | 123,295 | ||||||
| Cash costs per gold oz sold | 1,567 | $ | 1,330 | $ | 1,346 | ||||
| AISC per oz sold | $ | 1,950 | $ | 1,657 | $ | 1,658 | |||
Sustaining Capital and Sustaining Expenditures
Sustaining expenditures are defined as those expenditures which do not increase annual gold ounce production at a mine site and excludes all expenditures at the Company's projects and certain expenditures at the Company's operating sites which are deemed expansionary. Sustaining capital can include, but are not limited to, capitalized stripping costs at open pit mines, underground mine development, mining and milling equipment, and TSF raises. Sustaining expenditures includes sustaining capital, sustaining lease payments, reclamation expense and sustaining exploration expense.
The following table provides a reconciliation of sustaining expenditures to the Company's total expenditures for continuing operations:
| Three months ended | |||||||||
| $'s in millions | March 31, 2024 | December 31, 2023 | March 31, 2023 | ||||||
| Capital additions to mineral properties, plant and equipment(1) | $ | 134.4 | $ | 157.0 | $ | 154.5 | |||
| Less: Non-sustaining capital at operating sites | (10.0 | ) | (8.1 | ) | (4.6 | ) | |||
| Less: Non-sustaining capital at development projects | (64.1 | ) | (94.6 | ) | (91.1 | ) | |||
| Less: Capital expenditures - corporate | - | 0.1 | (0.1 | ) | |||||
| Less: Other non-cash additions(2) | (21.4 | ) | (11.7 | ) | (26.1 | ) | |||
| Sustaining capital | $ | 39.0 | $ | 42.7 | $ | 32.5 | |||
| Add: sustaining lease payments | $ | 2.6 | $ | 4.6 | $ | 3.8 | |||
| Add: reclamation expense | $ | 2.8 | $ |
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FAQ
How many ounces of gold were produced in the first quarter of 2024?
Equinox Gold produced 111,725 ounces of gold in the first quarter of 2024.
What is the total cash cost per ounce and AISC per ounce for Equinox Gold?
Equinox Gold reported total cash costs of $1,567 per oz and AISC of $1,950 per oz.
What was the net loss reported by Equinox Gold for the first quarter of 2024?
Equinox Gold reported a net loss of $42.8 million or $0.13 per share (basic) for the first quarter of 2024.
What recent acquisition did Equinox Gold announce?
Equinox Gold announced acquiring 100% ownership of Greenstone Mine.
What events are scheduled for shareholders on May 9, 2024?
Shareholder events on May 9, 2024, include a conference call, annual meeting, and Corporate Update.
What is the price Equinox Gold is paying to acquire Orion's 40% interest in Greenstone?
Equinox Gold is paying $995 million to acquire Orion's 40% interest in Greenstone.
Equinox Gold Corp.
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