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Cerrado Gold's net loss widens in third quarter on lower gold price and higher costs

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(Kitco News) - Cerrado Gold (TSX.V: CERT) announced Wednesday it produced 11,284 gold equivalent ounces in Q3 2022 at the Minera Don Nicolas mine (MDN) in Argentina, which is an increase of 7% over Q3 2021.

The company said that during Q3 2022 operations at MDN continued under normalized operations for the fourth consecutive quarter demonstrating the significant improvements that have been achieved at site, adding that management reiterates production guidance at 45,000 to 55,000 GEO for 2022.

The company also reported Q3 2022 all-in sustaining costs of $1,494 per ounce of gold sold (Q3 2021: $1,382/oz), up y-o-y due to higher stripping costs, lower throughput and higher labor costs during the quarter; costs expected to be significantly reduced in the fourth quarter, it added.

The company's adjusted EBITDA was $0.7 million in Q3 2022 which is a $2.3 million reduction quarter on quarter due to the lower production and a lower gold sales price over the period. Adjusted EBITDA decreased by $1.9 million as compared to the $2.6 million adjusted EBITDA recorded in Q3 2021.

According to a news release, net loss for the three months ended September 30, 2022, was $6.6 million as compared to a net loss of $1.5 million in the second quarter on 2022 and a $1.4 million net loss for the three months ended September 30, 2021.

CEO and Co-Chairman Mark Brennan stated, "Q3 provided challenges as we integrated new pits, increased strip ratios and incurred increased labor costs. We expect unit operating costs to have peaked with the fourth quarter looking particularity strong and note that production levels are within our range of guidance for 2022. Our heap leach pad construction has commenced and we believe this is the first step towards bringing stronger long term operating metrics to MDN. In Brazil, work continues to upgrade the resources at Monte Do Carmo while feasibility works are progressing as planned."

Cerrado is a Toronto based gold production, development and exploration company focused on gold projects in the Americas. The company is the 100% owner of both the producing Minera Don Nicolás mine in Santa Cruz province, Argentina and the highly prospective Monte Do Carmo development project, located in Tocantins State, Brazil.

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