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AuRico Gold Reports Third Quarter Financial Results And Confirms Declaration Of Commercial Production At Young-Davidson

Stocks in this article: AUQ

TORONTO, November 7, 2013 /PRNewswire/ --

(All amounts are in U.S. dollars, unless otherwise indicated)

AuRico Gold Inc. (TSX: AUQ) (NYSE: AUQ), ("AuRico" or the "Company") reports financial results for the three and nine months ended September 30, 2013. The Company will host a conference call on Friday, November 8, 2013 beginning at 8:30 a.m. Eastern Time (details below).

Financial Highlights

For the third quarter, the Company reported the following results:

  • Revenues of $54.3 million
  • Operating cash flow before changes in working capital (1) of $21.8 million, or $0.09 per share
  • Adjusted net earnings (1) of $0.8 million, or $0.00 per share
  • Net earnings of $14.9 million, or $0.06 per share, including reversals of net realizable value adjustments previously recognized of $7.4 million, or $0.03 per share
  • Production of 48,903 gold ounces (2)
  • Cash costs of $628 per gold ounce (1)

                                                        Third
                                                       Quarter
                    First Quarter    Second Quarter     Sept.       YTD as of
                     March 31/13       June 30/13       30/13      Sept. 30/13
    Gold Ounces
    Produced3          46,170            48,003        48,903        143,076
    Total Cash
    Costs per
    oz.1,2              $635              $655          $628          $640
    All-in
    Sustaining
    Costs per
    oz2.               $1,090            $1,189        $1,210        $1,164
  • All-in sustaining costs of $1,210 per gold ounce (3)
      1. Prior to commissioning the underground mine at Young-Davidson, cash costs are
         calculated on ounces
         produced from the open pit only. All underground costs are capitalized, and
         any revenue related to underground ounces sold is credited against capital.
      2. Cash costs, prior to long-term, low-grade stockpile and heap leach inventory
         net realizable value
         adjustments & reversals. See the Non-GAAP Measures section on page 20 of the
         Management's Discussion and Analysis for the three months ended Sept. 30, 2013.
      3. Includes pre-production gold ounces from the Young-Davidson underground mine.

Recent Highlights

  • Effective October 31, 2013 the Company declared commercial production of the Young- Davidson underground mine following the successful commissioning of the shaft and hoisting infrastructure. This key milestone will support increased underground productivities and favourable unit cost efficiencies over the life of the mine and will be pivotal in unlocking the potential of the Young- Davidson mine and positioning the Company for the future.
  • The Company's quarterly dividend payment of $0.04 per share for the third quarter was paid on October 29, 2013. The Company has introduced an optional dividend reinvestment plan to acquire additional common shares by reinvesting cash dividends. Further information on the Company's dividend reinvestment plan is available through the following link: http://www.auricogold.com/DRIP. The next dividend payment is scheduled to be paid on January 29, 2014 to shareholders of record on January 14, 2014.

"With the declaration of commercial production at the Young- Davidson underground mine the Company will begin to deliver steadily increasing annual production growth as the shaft and hoisting system supports increased underground productivities over the coming years," stated Scott Perry, President and Chief Executive Officer. He continued, "With five consecutive quarters of solid, company-wide results being reported, we continue to demonstrate the potential of our high quality asset base and the depth of our operations team. With two quality operations, a strong cash position and a fully-funded growth profile that is underpinned by the potential of the Young- Davidson mine, the Company is well positioned for significant, sustainable and profitable growth going forward."

    (1)  See the table at the end of this press release for a reconciliation
         of adjusted net earnings and adjusted operating cash flow and refer
         to the discussion of Non-GAAP measures below.
    (2)  Includes 10,447 pre-production gold ounces produced at Young-Davidson
         during the three months ended September 30, 2013.
    (3)  See the discussion of All-in Sustaining Costs and Non-GAAP measures
         provided below.
    Operational Highlights - Continuing Operations

                                                        Young-Davidson
                                                Quarter                 Quarter
                                                 Ended                   Ended
     (in thousands, except ounces, average   September 30,           September 30,
     realized prices and total cash costs)       2013                    2012
    Gold ounces produced                            19,652                   9,903
    Pre-production gold ounces produced(3)          10,447                   7,922
    Total gold ounces produced                      30,099                  17,825
    Total cash costs per gold ounce(1)(2)(3)          $666                    $639
    Revenue from mining operations                 $29,584                  $7,067
    Average realized gold price per ounce           $1,333                  $1,756

                                                        Young-Davidson
                                              Nine Months             Nine Months
                                                 Ended                   Ended
     (in thousands, except ounces, average   September 30,           September 30,
     realized prices and total cash costs)       2013                    2012
    Gold ounces produced                            59,639                   9,903
    Pre-production gold ounces produced(3)          27,993                  19,872
    Total gold ounces produced                      87,632                  29,775
    Total cash costs per gold ounce(1)(2)(3)          $692                    $639
    Revenue from mining operations                 $93,019                  $7,067
    Average realized gold price per ounce           $1,447                  $1,756

Continued, part two:

    Operational Highlights - Continuing Operations

                                                         El Chanate
                                                Quarter               Quarter
                                                 Ended                 Ended
     (in thousands, except ounces, average   September 30,         September 30,
     realized prices and total cash costs)       2013                  2012
    Gold ounces produced                            18,804                19,388
    Pre-production gold ounces produced(3)               -                     -
    Total gold ounces produced                      18,804                19,388
    Total cash costs per gold ounce(1)(2)(3)          $588                  $470
    Revenue from mining operations                 $24,720               $32,705
    Average realized gold price per ounce           $1,330                $1,655

                                                         El Chanate
                                              Nine Months           Nine Months
                                                 Ended                 Ended
     (in thousands, except ounces, average   September 30,         September 30,
     realized prices and total cash costs)       2013                  2012
    Gold ounces produced                            55,444                56,363
    Pre-production gold ounces produced(3)               -                     -
    Total gold ounces produced                      55,444                56,363
    Total cash costs per gold ounce(1)(2)(3)          $586                  $448
    Revenue from mining operations                 $83,830               $93,436
    Average realized gold price per ounce           $1,433                $1,665

Continued, part three:

    Operational Highlights - Continuing Operations

                                                            Total
                                                Quarter               Quarter
                                                 Ended                 Ended
     (in thousands, except ounces, average   September 30,         September 30,
     realized prices and total cash costs)       2013                  2012
    Gold ounces produced                            38,456                29,291
    Pre-production gold ounces produced(3)          10,447                 7,922
    Total gold ounces produced                      48,903                37,213
    Total cash costs per gold ounce(1)(2)(3)          $628                  $528
    Revenue from mining operations                 $54,304               $39,772
    Average realized gold price per ounce           $1,332                $1,672

                                                            Total
                                              Nine Months           Nine Months
                                                 Ended                 Ended
     (in thousands, except ounces, average   September 30,         September 30,
     realized prices and total cash costs)       2013                  2012
    Gold ounces produced                           115,083                66,266
    Pre-production gold ounces produced(3)          27,993                19,872
    Total gold ounces produced                     143,076                86,138
    Total cash costs per gold ounce(1)(2)(3)          $640                  $477
    Revenue from mining operations                $176,849              $100,503
    Average realized gold price per ounce           $1,440                $1,671
    Financial Highlights - Continuing Operations

                                                                                Quarter

                                                                                 Ended
                                                                               September
                                                         Quarter Ended
    (in thousands, except per share amounts)           September 30, 2013     30, 2012(2)
    Adjusted net earnings / (loss)(1)                                $816        ($1,180)
    Adjusted net earnings / (loss) per share, basic(1)              $0.00         ($0.00)
    Net earnings                                                  $14,859         $42,321
    Net earnings per share, basic                                   $0.06           $0.15
    Adjusted operating cash flow(1)                               $21,758          ($149)

                                                                              Nine Months

                                                                                 Ended
                                                                               September
                                                       Nine Months Ended
    (in thousands, except per share amounts)           September 30, 2013     30, 2012(2)
    Adjusted net earnings(1)                                      $18,536          $3,398
    Adjusted net earnings per share, basic(1)                       $0.07           $0.01
    Net (loss) / earnings                                       ($70,358)         $35,363
    Net (loss) / earnings per share, basic                        ($0.28)           $0.12
    Adjusted operating cash flow(1)                               $60,571          $6,716
    (1)  See the tables at the end of this press release for a reconciliation
         of adjusted net earnings and adjusted operating cash flow and refer
         to the discussion of Non-GAAP measures below. Total cash costs per
         gold ounce have been presented prior to net realizable value
         adjustments and reversals on the Young-Davidson low-grade long-term
         stockpile inventory and the El Chanate heap leach ore in process
         inventory. The Company has restated adjusted net earnings for 2012.
    (2)  Certain comparative information has been restated as a result of the
         adoption of IFRIC 20, Stripping Costs in the Production Phase of a
         Surface Mine, which was applied prospectively to production stripping
         costs incurred on or after January 1, 2012. For further details,
         refer to the Critical Accounting Estimates, Policies and Changes
         section on page 24 in the Company's Management's Discussion &
         Analysis or note 3(a) to the Company's condensed consolidated
         financial statements for the three and nine months ended September
         30, 2013.
    (3)  The Young-Davidson open pit mine declared commercial production on
         September 1, 2012, and is therefore excluded from consolidated cash
         costs prior to this date. Pre-production ounces produced are excluded
         from consolidated ounces produced as these ounces are credited
         against capitalized project costs when sold.
    Adjusted Net Earnings Reconciliation

                                                                  Quarter         Quarter

                                                                   Ended           Ended
                                                                 September       September

    (in thousands, except per share metrics)                      30, 2013        30, 2012
    Net earnings from continuing operations                       $14,859         $42,321
    Adjustments:
        Deferred income tax recovery related to foreign exchange   (7,335)        (17,511)
        Unrealized foreign exchange loss                             2,482          7,952
        Net realizable value adjustments on inventory              (7,372)              -
        Gain on option component of convertible notes              (3,875)        (14,416)
        Unrealized gains on investments                                  -        (20,251)
        Unrealized gain on derivatives                                   -           (730)
        Unrealized loss / (gain) on contingent consideration            63         (5,137)
        Other (including tax effect of adjustments)                  1,994           6,592
    Adjusted net earnings / (loss) from continuing operations         $816        ($1,180)
    Adjusted net earnings / (loss) from continuing operations,
        per share                                                    $0.00         ($0.00)

    Net loss from discontinued operations                                -        ($7,781)
    Adjustments:
        Unrealized foreign exchange loss                                 -           2,190
        Net realizable value adjustments on inventory                    -         (6,074)
        Disposition-related costs                                        -           5,327
        Gain on disposition of El Cubo and Guadalupe y Calvo             -        (24,062)
        Ocampo outside tax basis adjustment                              -          39,168
        Tax impact                                                       -           3,695
    Adjusted net earnings from discontinued operations                   -         $12,463
    Adjusted net earnings from discontinued operations, per share        -           $0.04

    Adjusted net earnings                                             $816         $11,283
    Adjusted net earnings, per share                                 $0.00           $0.04

                                                                      Nine            Nine
                                                                     Months          Months

                                                                     Ended           Ended
                                                                   September       September

    (in thousands, except per share metrics)                       30, 2013        30, 2012
    Net (loss) / earnings from continuing operations               ($70,358)         $35,363
    Adjustments:
       Deferred income tax expense / (recovery) related to
        foreign exchange     5,218        (16,414)
       Unrealized foreign exchange (gain) / loss                     (7,195)          12,961
       Net realizable value adjustments on inventory                  4,873               -
       Impairment charges                                            98,688               -
       Gain on option component of convertible notes                (14,850)        (10,232)
       Unrealized gains on investments                                    -         (17,632)
       Unrealized gain on derivatives                                (2,071)         (1,923)
       Unrealized loss / (gain) on contingent consideration           6,912          (5,137)
       Other (including tax effect of adjustments)                   (2,681)          6,412
    Adjusted net earnings from continuing operations                $18,536          $3,398
    Adjusted net earnings from continuing operations, per share       $0.07           $0.01

    Net earnings from discontinued operations                             -         $22,075
    Adjustments:
       Unrealized foreign exchange loss                                   -           9,471
       Loss on disposition of Australian operations                       -           1,736
       Net realizable value adjustments on inventory                      -           8,292
       Impairment of Australian Operations                                -          22,857
       Disposition-related costs                                          -           5,327
       Gain on disposition of El Cubo and Guadalupe y Calvo               -        (24,062)
       Ocampo outside tax basis adjustment                                -          39,168
       Tax impact                                                         -           2,904
    Adjusted net earnings from discontinued operations                    -         $87,768
    Adjusted net earnings from discontinued operations, per share         -           $0.31

    Adjusted net earnings                                           $18,536         $91,166
    Adjusted net earnings, per share                                  $0.07           $0.32
    Adjusted Operating Cash Flow Reconciliation

                                     Quarter                     Quarter

                                      Ended                       Ended
    (in thousands,                  September                   September
    except per share
    metrics)                         30, 2013                    30, 2012
    Operating cash
    flow from
    continuing
    operations                             $24,338                    ($5,653)
    Add back: Non-cash
    change in
    operating working
    capital                                (2,580)                       5,504
    Adjusted operating
    cash flow from
    continuing
    operations                             $21,758                      ($149)
    Adjusted operating
    cash flow from
    continuing
    operations, per
    share                                    $0.09                     ($0.00)

    (in thousands,
    except per share            Nine Months Ended           Nine Months Ended
    metrics)                    September 30, 2013          September 30, 2012
    Operating cash
    flow from
    continuing
    operations                             $51,312                        $582
    Add back: Non-cash
    change in
    operating working
    capital                                  9,259                       6,134
    Adjusted operating
    cash flow from
    continuing
    operations                             $60,571                      $6,716
    Adjusted operating
    cash flow from
    continuing
    operations, per
    share                                    $0.24                       $0.02

Non-GAAP Measures

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