Orezone Gold (ORE) Q3 2024 earnings summary

Executive summary

• Oxide plant operating above design at 5.9M tons/year, with expansion underway to add a 2.5M ton hard rock plant and target over 170,000 oz/year gold production by late 2025.

• Q3 saw record mill throughput (1.5M tons) and gold production of 26,851 oz, despite a four-day mill shutdown for maintenance.

• Revenue for Q3 2024 was $68.7M, up from $55.8M in Q3 2023; nine-month revenue was $191.7M, down from $203.9M year-over-year.

• Net income for Q3 2024 was $6.0M, slightly down from $6.2M in Q3 2023; nine-month net income was $29.9M, down from $44.8M year-over-year.

• Bomboré mine Phase II hard rock expansion approved in July 2024, with over $105M in new debt and equity financing secured.

Financial highlights

• Q3 gold production rose slightly quarter-over-quarter to 26,581 oz; October production was 12,096 oz.

• All-in sustaining costs (AISC) in Q3 were $1,655/oz, elevated due to higher strip ratio, lower-grade stockpiles, and increased royalties from higher gold prices.

• Free cash flow of $14.1M generated in Q3; quarter-end cash balance was $66.9M.

• Operating income for Q3 2024 was $19.3M, up from $10.5M in Q3 2023; nine-month operating income was $62.4M, down from $69.5M year-over-year.

• Share capital increased to $358.0M from $306.9M at year-end, reflecting a major private placement in August 2024.

Outlook and guidance

• 2024 gold production guidance unchanged, expected at or slightly above midpoint of 110,000–125,000 oz.

• Revised 2024 AISC guidance to $1,400–$1,475/oz, reflecting higher power costs and royalties.

• Hard rock expansion fully financed, with first gold expected Q4 2025.

• Phase II expansion at Bomboré expected to materially increase annual and life-of-mine gold production.

• Construction of the Phase II hard rock process plant and infrastructure is underway, with significant capital commitments outstanding.