Victoria Gold Corp. (TSX:VGCX) has unveiled its second quarter 2022 summary financial and operating results.
“Similar to 2021, daily gold production at the Eagle Mine has increased substantially over the 2022 spring season. This is expected to result in materially higher gold production and revenues during the third and fourth quarters of 2022,” President and CEO, John McConnell, said.
Operational Highlights – Second Quarter 2022
- Mine production was 2.2 million tonnes of ore.
- Ore stacked on the heap leach pad was 2.3 million tonnes at an average grade of 0.85 grams per tonne (g/t).
- Gold production was 32,055 ounces.
Financial Highlights – Second Quarter 2022
- Gold sold was 28,580 ounces, at an average realised price of $2,427 (US$1,901) per oz.
- Recognised revenue was $69.4 million based on sales of 28,580 ounces of gold.
- Operating earnings were $20.5 million.
- Net income was $17.1 million, or $0.27 per share outstanding.
- Cash costs were $1,057 (US$828) per oz and all-in sustaining costs (“AISC”)(1) were $1,750 (US$1,371) per oz of gold sold.
- EBITDA(1) were $44.2 million.
- Free cash flow(1) deficiency was $1.2 million, or a deficiency of $0.02 per share.
- Cash and cash equivalents were $29.1 million at June 30, 2022.
- Gold production and sales
- During the three months ended June 30, 2022, the Eagle Gold Mine produced 32,055 ounces of gold, similar to the 32,140 ounces of gold production in Q2 2021.
During the three months ended June 30, 2022, the company sold 28,580 ounces of gold, similar to the 28,731 gold ounces sold in Q2 2021.
Mining
During the three months ended June 30, 2022, a total of 2.2 million tonnes of ore were mined, at a strip ratio of 1.00:1 with a total of 4.3 million tonnes of material mined. In comparison, a total of 2.3 million tonnes of ore were mined, at a strip ratio of 1.45:1 with a total of 5.6 million tonnes of material mined for the prior comparable period in 2021.
Total tonnes mined were 23% lower during the three months ended June 30, 2022 versus the previous year’s comparable period primarily due to lower waste mining as per our mine plan. Mining rates are expected to increase in the second half of the year with shorter waste hauls becoming available late in the third quarter of 2022.
Processing
During the three months ended June 30, 2022, a total of 2.3 million tonnes of ore were stacked on the heap leach pad at a throughput rate of 25.3 k tonnes per day. A total of 2.4 million tonnes of ore were stacked on the heap leach pad at a throughput rate of 26.3 k tonnes per day for the prior comparable period in 2021.
- Ore stacked on the pad during the three months ended June 30, 2022 is similar to the previous year’s comparable period.
- Ore for the quarter had an average grade of 0.85 g/t Au, compared to 0.81 g/t Au in the prior comparable period in 2021.
As at June 30, 2022, the company estimates there are 115,089 recoverable ounces within mineral inventory.
Second Quarter and First Half-Year 2022 Financial Results
Revenue
For the three months ended June 30, 2022, the company recognized revenue of $69.4 million compared to $63.5 million for the previous year’s comparable period. The increase in revenue is attributed to a higher average realised price, partially offset by a lower number of gold ounces sold. Revenue is net of treatment and refining charges, which were $0.1 million for the three months ended June 30, 2022. The Company sold 28,580 ounces of gold at an average realised price of $2,427 (US$1,901) (see “Non-IFRS Performance Measures” section), compared to 28,731 ounces at an average realized price of $2,208 (US$1,798).
2022 Outlook
Production at the Eagle Gold Mine for 2022 is expected to be close to the lower end of original Guidance, of between 165,000 and 190,000 ounces.
Reduced production expectations are the result of increased unplanned down time within the crushing and conveying circuit. Unplanned down time is high due to lower maintenance productivities as a result of recruitment and retention challenges within the Canadian, and specifically the Pacific Northwest, mining labour market. Supply chain disruptions have exacerbated the maintenance difficulties as certain parts have taken longer to secure and deliver to site.
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