Orla Mining Reports First Quarter 2024 Results
(All amounts expressed in
- First quarter gold production was 33,223 ounces and gold sold was 32,046 ounces (pre-released).
- All-in sustaining costs ("AISC")1 was
$909 per ounce of gold sold during the first quarter 2024. - Adjusted earnings1 for the first quarter were
$16.8 million or$0.05 per share. - Net income for the first quarter was
$17.5 million or$0.06 per share. - Cash flow from operating activities before changes in non-cash working capital during the first quarter was
$21.7 million . - Exploration and project expenditure was
$8.6 million during the quarter, of which$3.9 million was capitalized and$4.7 million was expensed. - As at
March 31, 2024 , Orla's cash balance was$118.1 million and net cash1 was$29.7 million . - Subsequent to quarter end, the Company made a
$10.0 million re-payment towards its revolving credit facility reducing the outstanding balance drawn to$78.4 million .
"We continue to strive to be a gold mining company of choice, that effectively finds, builds, and operates high quality gold mines. In keeping with these objectives, we started 2024 with continued strong gold production at Camino Rojo generating meaningful free cash flow, we enhanced our landholdings in
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1 |
Non-GAAP measure. Please see the "Non-GAAP Measures" section of this news release for additional information. |
Financial and Operations Update
Table 1: Financial and Operating Highlights |
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Q1 2024 |
Q1 2023 |
Operating |
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Gold Produced |
oz |
33,223 |
25,910 |
Gold Sold |
oz |
32,046 |
26,859 |
Average Realized Gold Price1 |
$/oz |
|
|
Cost of Sales – Operating Cost |
$m |
|
|
Cash Cost per Ounce1 |
$/oz |
|
|
All-in Sustaining Cost per Ounce1 |
$/oz |
|
|
|
|
|
|
Financial |
|
|
|
Revenue |
$m |
|
|
Net Income (Loss) |
$m |
|
|
Adjusted Earnings1 |
$m |
|
|
Earnings per Share – basic |
$/sh |
|
|
Adjusted Earnings per Share – basic1 |
$/sh |
|
|
|
|
|
|
Cash Flow from Operating Activities |
$m |
|
|
Free Cash Flow1 |
$m |
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|
|
|
|
|
Financial Position |
|
|
|
Cash and cash equivalents |
$m |
|
|
Net cash1 |
$m |
|
|
1 |
Non-GAAP measure. Please see the "Non-GAAP Measures" section of this news release for additional information. |
In the first quarter, exploration efforts were concentrated on drilling activities at Camino Rojo in
Camino Rojo Extension Exploration (
As part of the near-mine exploration at Camino Rojo, the 2024 focus shifts to the promising Camino Rojo Extension, with a 30,000-metre drill program designed to test and expand the potential of the still-open mineralization at the expansive Camino Rojo deposit. The Company drilled over 10,000 metres and 10 holes during the quarter with assays and metallurgical testing in progress.
Camino Rojo Near-Mine Oxide Exploration (
The 2024 oxide extension program aims to delineate additional shallow oxide mineralization near the southeast pit wall, focusing on structurally controlled areas, with the objective of defining additional oxide gold material and extend the life of the Camino Rojo Oxide mine. The 2024 oxide extension program was completed in March, with total drilling of 2,036 metres in 19 drillholes. Assay results from the 2024 oxide extension program are expected in the second quarter.
Camino Rojo Sulphides Project Planning (
A preliminary underground resource estimate on the Camino Rojo Sulphides is anticipated to be completed in the second half of 2024. Metallurgical study of the recent phase of Camino Rojo sulphide infill drilling is expected to continue throughout 2024.
South Railroad Project Permitting (
The Company continues baseline environmental data collection to facilitate the environmental studies required to support development of the Environmental Impact Statement ("EIS"), and the overall National Environmental Policy Act ("NEPA") permitting process. Orla is currently expanding on this work to allow flexibility in project planning when working with the
During the quarter, Orla announced the acquisition of Contact Gold ("Contact"). Contact's key asset is the 100%-owned
Orla has commenced the integration of
For further details, please see the Company's news releases dated
The Company has filed a Notice of Intent to Arbitrate with the Government of
With the acquisition of Contact Gold, Orla intends to increase the 2024 exploration budget in
The Company remains on track to meet its 2024 gold production guidance of 110,000 to 120,000 ounces and AISC guidance of
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FY 2024 |
Q1 2024 |
Gold Production |
Oz |
110,000 – 120,000 |
33,223 |
Total Cash Cost (net of by-product)1 |
$/oz au sold |
|
|
AISC1 |
$/oz au sold |
|
|
Capital Expenditures |
$m |
|
|
Sustaining capital expenditures |
$m |
|
|
Non-sustaining capital expenditures |
$m |
|
|
Exploration Expenses & |
$m |
|
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1. |
Total Cash Cost and AISC are not non-GAAP measures. See the "Non-GAAP Measures" section of this news release for additional information. |
2. |
Exchange rates used to forecast cost metrics include MXN/USD of 18.0 and CAD/USD of 1.33. A +/-1.0 change to the MXN/USD exchange rate would have an impact of +/ |
3. |
The initial FY 2024 expensed exploration guidance of |
Orla's unaudited financial statements and management's discussion and analysis for the quarter ended
The scientific and technical information in this news release was reviewed and approved by Mr.
Orla will host a conference call on
Dial-In Numbers / Webcast: |
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Conference ID: |
5844017 |
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Toll Free: |
1 (888) 550-5302 |
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Toll: |
1 (646) 960-0685 |
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Webcast: |
Orla's corporate strategy is to acquire, develop, and operate mineral properties where the Company's expertise can substantially increase stakeholder value. The Company has two material gold projects: (1) Camino Rojo, located in Zacatecas State,
The Company has included certain performance measures in this news release which are not specified, defined, or determined under generally accepted accounting principles (in the Company's case, International Financial Reporting Standards ("IFRS"")). These are common performance measures in the gold mining industry, but because they do not have any mandated standardized definitions, they may not be comparable to similar measures presented by other issuers. Accordingly, the Company uses such measures to provide additional information and you should not consider them in isolation or as a substitute for measures of performance prepared in accordance with generally accepted accounting principles ("GAAP"). In this section, all currency figures in tables are in thousands, except per-share and per-ounce amounts.
Average realized gold price per ounce sold is calculated by dividing gold sales proceeds received by the Company for the relevant period by the ounces of gold sold. The Company believes the measure is useful in understanding the gold price realized by the Company throughout the period.
AVERAGE REALIZED GOLD PRICE |
Q1 2024 |
Q1 2023 |
Revenue |
$ 67,278 |
$ 51,131 |
Silver sales |
(1,310) |
(424) |
Gold sales |
65,968 |
50,707 |
Ounces of gold sold |
32,046 |
26,859 |
AVERAGE REALIZED GOLD PRICE |
$ 2,059 |
$ 1,888 |
Net cash (debt) is calculated as cash and cash equivalents and short-term investments less total debt adjusted for unamortized deferred financing charges at the end of the reporting period. This measure is used by management to measure the Company's debt leverage. The Company believes that in addition to conventional measures prepared in accordance with IFRS, net debt is useful to evaluate the Company's leverage and is also a key metric in determining the cost of debt.
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|
|
Cash and cash equivalents |
$ 118,067 |
$ 96,632 |
Less: Long term debt |
(88,350) |
(88,350) |
|
$ 29,717 |
$ 8,282 |
Adjusted earnings excludes deferred taxes, unrealized foreign exchange, changes in fair values of financial instruments, impairments and reversals due to net realizable values, restructuring and severance, and other items which are significant but not reflective of the underlying operational performance of the Company. The Company believes these measures are useful to market participants because they are important indicators of the strength of operations and the performance of the core business. With the addition of performance share units ("PSUs") at the end of Q1 2023, the Company expects greater volatility in share-based payments expense going forward. Accordingly, the effect of these PSUs in the calculation of adjusted earnings was excluded.
ADJUSTED EARNINGS |
Q1 2024 |
|
Q1 2023 |
Net income for the period |
$ 17,485 |
|
$ 13,235 |
Unrealized foreign exchange |
(911) |
|
(1,803) |
Accretion on deferred revenue |
122 |
|
— |
Share based compensation related to PSUs |
124 |
|
— |
ADJUSTED EARNINGS |
$ 16,820 |
|
$ 11,432 |
|
|
|
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Millions of shares outstanding – basic |
315.1 |
|
306.3 |
Adjusted earnings per share – basic |
$ 0.05 |
|
$ 0.04 |
Companies may choose to expense or capitalize their exploration expenditures. The Company expenses exploration costs based on its accounting policy. To assist the reader in comparing against those companies which capitalize their exploration costs, please note that included within Orla's net income (loss) for each period are exploration costs which were expensed, as follows:
|
Q1 2024 |
Q1 2023 |
Exploration & evaluation expense |
$ 4,744 |
$ 6,866 |
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|
The Company believes market participants use Free Cash Flow to evaluate the Company's operating cash flow capacity to meet non-discretionary outflows of cash. Free Cash Flow is not meant to be a substitute for the cash flow information presented in accordance with IFRS. Free Cash Flow is calculated as the sum of cash flow from operating activities and cash flow from investing activities, excluding certain unusual transactions.
FREE CASH FLOW |
Q1 2024 |
|
Q1 2023 |
Cash flow from operating activities |
$ 32,406 |
|
$ (4,922) |
Cash flow from investing activities |
(8,480) |
|
(592) |
FREE CASH FLOW |
$ 23,926 |
|
$ (5,514) |
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Millions of shares outstanding – basic |
315.1 |
|
306.3 |
Free cash flow per share – basic |
$ 0.08 |
|
$ (0.02) |
The Company calculates cash cost per ounce by dividing the sum of operating costs and royalty costs, net of by-product silver credits, by ounces of gold sold. Management believes that this measure is useful to market participants in assessing operating performance.
The Company has provided an AISC performance measure that reflects all the expenditures that are required to produce an ounce of gold from operations. While there is no standardized meaning of the measure across the industry, the Company's definition conforms to the all-in sustaining cost definition as set out by the
Figures are presented only from
CASH COST |
Q1 2024 |
|
Q1 2023 |
Cost of sales – operating costs |
$ 18,109 |
|
$ 11,792 |
Royalties |
1,668 |
|
1,306 |
Silver sales |
(1,310) |
|
(424) |
CASH COST |
$ 18,467 |
|
$ 12,674 |
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|
|
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Ounces sold |
32,046 |
|
26,859 |
Cash cost per ounce sold |
$ 576 |
|
$ 472 |
ALL-IN SUSTAINING COST |
Q1 2024 |
|
Q1 2023 |
Cash cost, as above |
$ 18,467 |
|
$ 12,674 |
General and administrative expenses |
3,869 |
|
3,265 |
Share based payments |
1,331 |
|
1,107 |
Accretion of site closure provisions |
112 |
|
144 |
Amortization of site closure provisions |
136 |
|
125 |
Sustaining capital |
4,614 |
|
1,145 |
Sustaining capitalized exploration expenses |
413 |
|
— |
Lease payments |
199 |
|
162 |
ALL-IN SUSTAINING COST |
$ 29,141 |
|
$ 18,622 |
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|
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Ounces sold |
32,046 |
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26,859 |
All-in sustaining cost per ounce sold |
$ 909 |
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$ 693 |
This news release contains certain "forward-looking information" and "forward-looking statements" within the meaning of Canadian securities legislation and within the meaning of Section 27A of the United States Securities Act of 1933, as amended, Section 21E of the United States Exchange Act of 1934, as amended, the United States Private Securities Litigation Reform Act of 1995, or in releases made by the
SOURCE