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Argonaut Gold posts net loss of $152M in ‘challenging' 2022 year

Kitco News

(Kitco News) - Argonaut Gold (TSX: AR) announced today that the company produced 203,155 gold equivalent ounces (GEOs) in 2022, down 17% compared to 2021 (244,156 GEOs) and within its annual guidance.

The company said it exceeded 2022 cost guidance for cash cost ($1,443 per gold ounce sold, up 43% y-o-y) and AISC ($1,765 per gold ounce sold, up 35% y-o-y) due to write-downs of inventories to net realizable values at El Castillo, Florida Canyon, San Agustin, and La Colorada, which increased cash cost and AISC by $114 per ounce.

Argonaut also reported 11% decrease in revenue to $388.3 million in 2022 as a result of lower gold ounces sold, as well as 2022 net loss of $152.2 million compared to net income of $26.5 million in 2021.

"Last year was a challenging year for the company on two fronts. First, the increase in construction costs at the Magino project required a large capital raise, including debt, equity and the sale of a royalty. Second, the inflationary pressures had a significant impact on operating results of our low-grade heap leach operations, resulting in an impairment of our Mexican assets and Florida Canyon mine," stated CFO David Ponczoch.

"Looking ahead, management is laser focused on completing the Magino project, with first pour planned for mid-May followed by commercial production in the third quarter. The commissioning of Magino will be the first step in transforming the company as it enters a pivotal growth stage. We believe Magino has the potential to be one of the 10 largest and lowest cost gold mines in Canada, combining a large open pit operation with the potential of higher-grade underground material to feed an expandable mill. In addition, management will be focused on exploring the large sulfide resource at Florida Canyon, located just below the oxide deposits," said President and CEO Richard Young.

Argonaut Gold is a Canadian gold company. The company is in the final stages of construction of the Magino mine, located in Ontario, Canada. The company also has three operating mines including the Florida Canyon mine in Nevada, USA, the San Agustin mine in Durango, Mexico, and the La Colorada mine in Sonora, Mexico. In addition, the company holds the advanced exploration stage Cerro del Gallo project and several other exploration stage projects, all of which are located in North America.

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