Mill Expansion Advances to Increase Gold Production
Key highlights for Q1 2024 include:
- Positive operating cash flow: The Company poured 4,927 ounces of gold and sold 4,895 ounces of gold, resulting in positive operating cash flow of
$5.1 million . - Strong gross profit margins: The Company recognized revenue of
$9.4 million and cost of sales of$5.7 million , generating gross profit of$3.7 million , gross profit margin of 40%, and Adjusted EBITDA1 of$2.6 million . - Growth through prudent capital management: The Company continues to demonstrate its ability to manage capital and use cash flow from mining operations to fund additional growth at Buckreef Gold, as it reinvested
$3.8 million during the quarter to advance its 3rd consecutive mill expansion to 2,000+ tonnes per day (“tpd”) and to advance construction on a significantly expanded tailings storage facility (“TSF”) to accommodate higher production volumes and support the long-term growth of Buckreef Gold. - Fiscal 2024 production guidance unchanged: The Company continues to expect gold production for 2024 to be between 25,000 – 30,000 ounces at total average cash cost1 of
$800 – 900 per ounce. - Expansion to 2,000+ tpd continues to progress on schedule: The new 1,000 tpd ball mill arrived on site in early
October 2023 and earthworks have commenced for the ball mill plinth, tank line foundation and bund wall, which will support the additional leach tanks. In-depth engineering reviews and construction work have begun, including concrete construction and steel fabrication on the new crushing circuit which commenced inNovember 2023 . The process plant expansion aimed at expanding throughput by 75-100% has a targeted completion date in the second half of fiscal 2024 and is expected to benefit production in Q4 2024. - Expanded crushing circuit construction underway: The initial phase of the new crushing circuit arrived on site in
January 2024 and is configured to produce a finely crushed ore ‘product’ suitable for the existing and future ball mills. It is expected that the new crushing circuit will help drive increased throughput and recovery percentages and will provide capacity for increased production. It is also expected to improve options for material handling, provide equipment redundancy to eliminate or reduce plant downtime, and improve grind size allowing for more efficient, cost-effective processing of sulphide ore. Concrete construction has been completed and is curing. Steel design, fabrication and construction of the new crushing circuit continues at a rapid pace, and completion is expected in Q2 2024. - Exploration, a key area of focus: The Company expects to continue to build on past exploration successes through a drill program that is expected to begin in the second half of fiscal 2024. While the Company primarily focused on grade control drilling to support mining activity during Q1 2024, exploration drilling for 2024 will focus on infill and expansion drilling at Eastern Porphyry, Buckreef West, Inferred Mineral Resources and strike extensions, both to the NE and SW of the
Main Zone – which, if successful, has the potential to increase tonnes to higher Mineral Resource categories. - Health & Safety remains top of mind: The Company achieved zero lost time injuries (“LTI”) and there were no reportable environmental or community related incidents during Q1 2024. Subsequent to Q1 2024, Buckreef Gold achieved, for a second time, 1 million hours LTI free work.
TRX Gold’s CEO,
Figure 1: 1,000+ tpd Processing Plant at
Figure 2: Buckreef Gold Tailings Storage Facility Expansion at TSF 2.2 (Q1 2024 – first lift completed and TSF is now operational)
Figure 3: Buckreef Gold’s new and expanded crushing circuit under construction (Q1 2024)
Figure 4: Buckreef Gold’s new cone crusher and site construction underway (Q1 2024)
Figure 5: Buckreef Gold’s new jaw crusher and site construction underway (Q1 2024)
Qualified Person
Mr.
Q1 2024 Results Conference Call and Webcast Details
When:
Webcast URL: https://shorturl.at/movwM
Conference call numbers:
International Toll: +1-647-484-8814
A replay will be made available for 30 days following the call on the Company’s website.
About
For investor or shareholder inquiries, please contact:
Investors
Vice President, Investor Relations
+1-438-399-8665
c.lalli@TRXgold.com
www.TRXgold.com
Non-IFRS Performance Measures
The company has included certain non-IFRS measures in this news release. The following non-IFRS measures should be read in conjunction with the Company’s unaudited interim consolidated financial statements for the three months ended
Cash cost per ounce of gold sold
Cash cost per ounce of gold sold is a non-IFRS performance measure and does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. Cash cost per ounce may not be comparable to information in other gold producers’ reports and filings. Upon declaration of commercial production of the 1,000+ tpd processing plant in Q1 2023, capitalization of mine development costs ceased, and depreciation of capitalized mine development costs commenced. As the Company uses this measure to monitor the performance of our gold mining operations and its ability to generate positive cash flow, beginning in Q1 2023, total cash cost per ounce of gold sold starts with cost of sales related to gold production and removes depreciation.
Adjusted EBITDA
Adjusted EBITDA is a non-IFRS performance measure and does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. Adjusted EBITDA may not be comparable to information in other gold producers’ reports and filings. Adjusted EBITDA is presented as a supplemental measure of the Company’s performance and ability to service its obligations. Adjusted EBITDA is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the industry, many of which present Adjusted EBITDA when reporting their results. Issuers present Adjusted EBITDA because investors, analysts and rating agencies consider it useful in measuring the ability of those issuers to meet their obligations. Adjusted EBITDA represents net income (loss) before interest, income taxes, and depreciation and also eliminates the impact of a number of items that are not considered indicative of ongoing operating performance.
Certain items of expense are added, and certain items of income are deducted from net income that are not likely to recur or are not indicative of the Company’s underlying operating results for the reporting periods presented or for future operating performance and consist of:
- Change in fair value of derivative financial instruments;
- Accretion related to the provision for reclamation;
- Share-based compensation expense; and
- Tax adjustments related to a prior period tax assessment (2012-2020).
The following table provides a reconciliation of net income (loss) and comprehensive income (loss) to Adjusted EBITDA per the financial statements for the three ended
Three Months Ended | Three Months Ended | |||
Net (loss) income and comprehensive (loss) income per financial statements | (39 | ) | 5,160 | |
Add: | ||||
Depreciation | 484 | 193 | ||
Interest and other non-recurring expenses | 340 | 180 | ||
Income tax expense | 1,191 | 1,486 | ||
Change in fair value of derivative financial instruments | (199 | ) | (3,365 | ) |
Share-based payment expense | 810 | 753 | ||
Adjusted EBITDA | 2,587 | 4,407 |
The Company has included “cash cost per ounce of gold sold” and “Adjusted EBITDA” as non-IFRS performance measures throughout this news release as
Forward-Looking and Cautionary Statements
This press release contains certain forward-looking statements as defined in the applicable securities laws. All statements, other than statements of historical facts, are forward-looking statements. Forward-looking statements are frequently, but not always, identified by words such as “expects”, “anticipates”, “believes”, “hopes”, “intends”, “estimated”, “potential”, “possible” and similar expressions, or statements that events, conditions or results “will”, “may”, “could” or “should” occur or be achieved. Forward-looking statements relate to future events or future performance and reflect
Although
The disclosure contained in this press release of a scientific or technical nature relating to the Company’s
The information contained in this press release is as of the date of the press release and
Photos accompanying this announcement are available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/0c922ca0-4d9d-40cd-aeeb-c447be6bf52b
https://www.globenewswire.com/NewsRoom/AttachmentNg/0d78f5bc-ca71-4514-a380-e2e9c67da4f3
https://www.globenewswire.com/NewsRoom/AttachmentNg/d96296f0-972c-4bca-9e74-53920fc2353a
https://www.globenewswire.com/NewsRoom/AttachmentNg/4c2d9341-bf64-4b10-a284-c9224e389190
https://www.globenewswire.com/NewsRoom/AttachmentNg/331e34ab-6c85-4b57-b1f7-429a1ec8c2fe
1 Refer to “Non-IFRS Performance Measure” section.
2 See Forward-Looking and Cautionary Statements
© OMX, source