engages in gold mining, extraction, processing, as well as exploration and development. The company owns Black Fox, an open-pit and underground mine and mill located near Matheson in the Province of Ontario, Canada.
For the first quarter ended March 2011, the company reported 22.9% year-over-year decrease in revenue to $13.6 million from $17.6 million, as lower gold sales more than offset higher average selling prices. Gold sales declined 36.7% to 10,003 ounces from 15,796 ounces during the first quarter of 2010 because the Black Fox mill processed lower grade ores, averaging 1.67 gm per tonne (gpt) compared to 2.68 gpt in the year-ago quarter. Average realized gold price rose 54.8% to $1,356 per ounce from $876 per ounce.
The company swung to a net income of $2.8 million, or 2 cents per share, compared to a loss of $1.8 million, or 3 cents per share, driven by a gain on the fair value adjustment related to equity-linked financial instruments of $6.5 million, compared to a gain of $2 million in the same quarter last year.
The company strengthened its balance sheet by repaying the balance $22 million on the Black Fox property and raised $50 million from the issuance of senior unsecured convertible debentures.
Brigus recently announced that exploration drilling on the southern part of the Black Fox complex continues to return excellent gold assays over significant widths within the new 147 gold zone (147 Zone), including 3.96 gpt over 50 metres that included 6.82 gpt over 20 metres.
Going forward, the company projects production of approximately 73,000 to 80,000 ounces of gold at a cash cost of $575 to $625 in 2011. The Black Fox mine is expected to produce between 16,500 to 18,000 ounces of gold in the second quarter of 2011.
Two analysts covering the stock rate it a buy. The stock has no sell ratings. On average, analysts estimate 62.3% upside to $2.56 in value from current levels. The stock has gained 8.2% in the last one month.