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Brigus Gold Reports Q3 Financial Results

Brigus Gold Corp. (“Brigus” or the “Company”)(NYSE MKT: BRD) (TSX: BRD) announces results for the third quarter (“Q3-12”) of 2012.

This press release should be read in conjunction with the Company’s September 30, 2012 condensed consolidated interim financial statements and associated Management’s Discussion and Analysis (“MD&A”), which are available from the Company's website ( www.brigusgold.com) and on SEDAR ( www.sedar.com). All dollar amounts are expressed in US dollars unless otherwise specified. All financial results are presented in accordance with International Financial Reporting Standards.

Third Quarter 2012 Financial Highlights

  • Sold 19,064 ounces of gold, a 4% increase over the 18,419 ounces sold in Q2-12 and an 11% increase over the 17,119 ounces sold in Q3-11.
  • Reduced cash costs to $728 per ounce, a 10% decrease in cash costs from Q3-11, which totalled $807 per ounce and a 9% decrease in cash costs in Q2-12, which were $799 per ounce.
  • Generated cash flow from operations, before working capital adjustments, of $12.5M, compared to $10.5M in the same period in 2011.
  • Increased operating margin by 2% to $855 per ounce, compared to $836 per ounce in Q3-11.
  • Generated positive income from operations of $5.9M, compared to $2.6M in Q3-11.
  • Brigus completed the sale of the Calais Notes to New West Capital for total proceeds of $6M.
    Gold ounces   Cash costs per ounce
Q1-12 16,922 $858
Q2-12 18,254 $799
Q3-12 19,526 $728

Consolidated Financial Results

($ thousands, except per share and ounces)   For the three months ended   For the nine months ended
  September

30, 2012

 

September 30, 2011

September 30, 2012

  September

30, 2011

Revenue from the sale of gold $   30,170 $   19,243 $   84,415 $   50,676
Operating costs $   24,266 $   16,617 $   70,345 $   54,317
Income (loss) from operations $   5,904 $  

2,626

$   14,070 $   (3,641)
Net income $   8,724 $   13,073 $   14,660 $   13,362
Basic and diluted earnings per share $   0.04 $   0.07 $   0.07 $   0.07
Cash flows from operations $   4,144 $   6,281 $   21,471 $   13,752
Gold sales in ounces     19,064     17,119     53,516     42,299
Total cash cost per ounce of gold sold $   728 $   807 $   791 $   913

Third Quarter 2012 Operational Highlights

  • Produced 19,526 ounces of gold, a 7% increase over Q2-12 production of 18,254 ounces and a 16% increase over Q3-11 production of 16,838 ounces.
  • The underground average gold grade in the third quarter was 6.00 grams per tonne (gpt).
  • The open pit mined 217,118 ore tonnes at an average grade of 2.13 gpt, a 22% increase over the ore tonnes mined in Q3-11.
  • The Black Fox Mill processed 190,879 tonnes of ore at an average grade of 3.34 gpt and an average recovery of 95%, compared to 189,674 tonnes at an average grade of 2.93 gpt and an average recovery of 94% in Q3-11.
  • Brigus released a National Instrument 43-101 report which increased the Indicated gold resource at the Company’s Grey Fox property from 116,710 to 480,850 ounces. This resource offers a near term production opportunity for Brigus and remains open for expansion.
  • Late in the quarter, the Company began mining a large long-hole stope in the West zone of the underground mine. This stope will provide 400 to 500 tonnes of ore per day once fully operational in Q1-13.
  • The Company continued to report excellent exploration results from the 147 and Contact zones and reported the discovery of a new zone named the Grey Fox South Zone.
  • Subsequent to the quarter, the mill optimization program was completed and resulted in increased mill processing capacity of approximately 10% to 2,200 tpd.
  • Subsequent to the quarter, the Company completed a $10M Flow Through financing to fund Brigus’ 2013 exploration program.
  • Subsequent to the quarter, the Company completed a bought deal debt financing for $30M in senior secured notes, the proceeds of which were used to repurchase 4% of a goldstream with Sandstorm Gold Ltd.
  • Early in the quarter, Daniel Racine, a well-respected mining engineer with over 25 years of experience, joined the Brigus team as Chief Operating Officer.
  • Marc Bilodeau was promoted from General Mine Manager to Vice President Operations. Marc’s hard work and leadership have resulted in significant operational improvements at the Black Fox Mine over the past year.

Results from Operations

   

For the three months ended

  For the nine months ended
September

30, 2012

  September

30, 2011

September

30, 2012

  September

30, 2011

Metal Sales
Gold (ounces)     19,064     17,119     53,516     42,299
Silver (ounces)     1,033     997     3,082     1,855
Average realized gold price $   1,583 $   1,643 $   1,577 $   1,511
Production
Open pit ore tonnes mined     217,118     178,427     629,739     295,996
Open pit operating waste tonnes mined     1,293,515     1,798,717     3,953,502     3,422,853
Open pit capital stripping tonnes mined     632,650     968,431     2,077,645     3,571,155
Open pit overburden tonnes mined     38,632     -     38,632     293,680
Total open pit tonnes mined     2,181,915     2,945,575     6,699,518     7,583,684
Total underground ore tonnes mined     43,504     67,551     115,255     104,319
Total tonnes mined     2,225,419     3,013,126     6,814,773     7,688,003
Milling
Tonnes milled     190,879     189,674     549,846     550,391
Tonnes milled per day     2,075     2,062     2,007     2,016
Head grade of ore (gpt)     3.34     2.93     3.23     2.50
Recovery (%)     95%     94%     96%     94%
Gold ounces produced     19,526     16,838     54,702     41,299
Total cash costs ($/ounce) $   728 $   807 $   791 $   913
Operating margin ($/ounce) $   855 $   836 $   786 $   598

“We are pleased with continued financial and operational improvements at the Black Fox Mine during quarter three,” said Wade Dawe, Brigus’ President and Chief Executive Officer. “Gold production from the underground mine continues to ramp up and per ounce production costs are trending lower. We have a strong operational team in place to build on our successes at the Black Fox Mine, while implementing a plan to develop the Grey Fox Mine. We are confident that quarter four will be our best quarter to date and we look forward to the future with optimism.”

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