New Gold reports production slide in Q1 2021, on track to meet annual guidance
(Kitco News) - New Gold (TSX: NGD; NYSE American: NGD) today reported that its total production in Q1 2021 was 96,026 gold equivalent ounces (66,650 ounces of gold, 187,224 ounces of silver and 13.8 million pounds of copper), a 7% decline compared to Q1 2020 (103,435 ounces).
First quarter gold eq production at Rainy River was 56,513 ounces (54,656 ounces of gold and 133,730 ounces of silver), an 11% increase over Q1 2020. Lower grades were expected during the quarter as mining operations were focused on Phase 3 stripping to bring pit walls to the final pit limit. During the second half of the year, grades are expected to increase as the mine returns to Phase 2 area of the pit. The increase compared to the prior-year period is due to higher throughput.
First quarter gold eq. production at New Afton was 39,512 ounces (11,994 ounces of gold, and 13.8 million pounds of copper), a 24% decline over Q1 2020. The decrease compared to the prior-year period is due to lower grades and lower throughput as a result of the mud rush incident.
Revenues for the quarter were $165 million, an increase compared to the prior-year period ($142 million) due to higher gold and copper prices, which was partially offset by lower sales volume as underground operations at New Afton continued to ramp-up during the quarter following the tragic mud-rush incident in February.
Net earnings for the quarter were $15 million ($0.02 per share), an increase compared to the prior-year period primarily due to higher revenue, lower depreciation and depletion and a gain on the revaluation of the Rainy River gold stream obligation and the New Afton free cash flow obligation to the Ontario Teacher's Pension Plan as a result of an increase in discount rates.
The company said that planned increases in grade at Rainy River through the year, and New Afton nearing pre-incident mining rates, are expected to underpin stronger operational and financial results in the final three quarters of 2021 such that the company remains on-track to achieve its guidance.