{"id":8527,"date":"2020-05-01T10:10:00","date_gmt":"2020-05-01T10:10:00","guid":{"rendered":"https:\/\/icrowdnewswire.com\/2020\/05\/01\/pretivm-reports-first-quarter-2020-operating-and-financial-results-steady-production-at-brucejack-continues-to-generate-significant-cash-flows\/"},"modified":"2020-05-01T10:10:00","modified_gmt":"2020-05-01T10:10:00","slug":"pretivm-reports-first-quarter-2020-operating-and-financial-results-steady-production-at-brucejack-continues-to-generate-significant-cash-flows","status":"publish","type":"post","link":"https:\/\/ipsnews.net\/business\/2020\/05\/01\/pretivm-reports-first-quarter-2020-operating-and-financial-results-steady-production-at-brucejack-continues-to-generate-significant-cash-flows\/","title":{"rendered":"Pretivm Reports First Quarter 2020 Operating and Financial Results; Steady Production at Brucejack Continues to Generate Significant Cash Flows"},"content":{"rendered":"

Impact of COVID-19<\/strong><\/p>\n

The Company’s primary commitment is the safety and health of our workforce and neighbouring communities in northwest British Columbia. A significant number of steps have been taken to limit the risk of COVID-19 exposure for our staff, their families and communities (see news release dated April 2, 2020). There are no confirmed cases of COVID-19 at Brucejack as of April 30, 2020.<\/p>\n

Throughout the COVID-19 pandemic, the Brucejack Mine has operated continuously under the strict guidance and directives of federal, provincial and regional health authorities, while ensuring the well-being of our employees, communities and other stakeholders.<\/p>\n

Only personnel necessary to support gold production continue to work at the mine while COVID-19 restrictions are in place. Consequently, all capital projects and expansion drilling have been placed on hold and crews have been demobilized.<\/p>\n

Supplies and Inventory<\/em><\/p>\n

At present, interruptions to the supply chain are not anticipated. Supply chains are being monitored and increased inventory levels have been established with supplies on order accordingly.<\/p>\n

Doré and Concentrate Sales<\/em><\/p>\n

Doré and flotation concentrate sales are proceeding as planned without any disruptions to date. With multiple off-takers for both doré and flotation concentrate, no sales disruptions are anticipated at this time.<\/p>\n

Production<\/em><\/p>\n

The COVID-19 pandemic did not impact first quarter gold production. Milled tonnes for the quarter totaled 345,139 or 3,793 tonnes per day. A shortage of personnel at the outset of the COVID-19 crisis in March resulted in a minor impact on development and a delay to the start of the reverse circulation grade control drill program. A total of 2,784 meters of lateral development and 60 meters of vertical development were achieved. We are reviewing the future impact to development, stope availability and production should the restrictions related to COVID-19 persist.<\/p>\n

Looking ahead, the Company currently expects a modest impact on costs should operations continue with enhanced safety measures in effect. However, COVID-19 may have a significant impact on cost and production if the current situation continues or if government authorities mandate temporary closures or if the Company is not able to maintain operations.<\/p>\n

2020 Guidance<\/strong><\/p>\n

2020 Production and Financial Guidance Maintained<\/em><\/p>\n

The Company produced 82,888 ounces of gold during the first quarter of 2020 and expects to achieve its 2020 gold production guidance at the Brucejack Mine of 325,000 ounces to 365,000 ounces. With the expectation that Brucejack continues to operate within the current framework of the restrictions, production is planned to continue for 2020 at a rate of 3,800 tonnes per day with the average annual gold grade ranging between 7.6 grams per tonne and 8.5 grams per tonne at an average gold recovery of 97%.<\/p>\n

The all-in sustaining cost1<\/sup> (“AISC”) was $996 per ounce of gold sold for the first quarter 2020. The Company expects to achieve its 2020 financial guidance with AISC ranging from $910 to $1,060 per ounce gold sold. AISC estimates include costs associated with continued lateral development at a rate of approximately 1,000 meters per month through 2020. In addition, the AISC estimates include costs associated with a high-density reverse circulation drill program to increase the volume of grade information necessary to enhance mine planning and optimize gold production. This program has been placed on hold while COVID-19 restrictions are in place.  <\/p>\n

2020 Free Cash Flow Forecast Maintained<\/em><\/p>\n

First quarter free cash flow1<\/sup> was $41.8 million at an average realized gold price1<\/sup> of $1,605 per ounce. The Company remains on target to achieve free cash flow for 2020 in the range of $100.0 million to $170.0 million. The 2020 free cash flow forecast is based on an average gold price of $1,450 per ounce.<\/p>\n

Capital expenditures include approximately $30.0 million of sustaining capital expenditures, approximately $15.0 million in expansion capital expenditures, and approximately $10.0 million for regional exploration. Certain of these capital expenditures are on hold and may be deferred as only personnel necessary to support gold production continue to work at the mine while COVID-19 restrictions are in place.<\/p>\n

Subsequent to quarter end, as a precautionary measure in response to the continuing operational risks related to COVID-19, the Company drew down $16.0 million of the Company’s revolving portion of the Loan Facility to increase available liquidity. The Company will focus on liquidity rather than discretionary debt reduction until the restrictions related to the COVID -19 pandemic have been lifted.<\/p>\n

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1 <\/em><\/sup>Refer to the “Non-IFRS Financial Performance Measures” section at the end of this news release for reconciliation.<\/em><\/p>\n

First Quarter 2020 Operating and Financial Highlights<\/strong><\/p>\n

Key Operating Metrics<\/strong><\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
 <\/em><\/strong><\/td>\n3 months ended Mar 31,<\/em><\/strong>
<\/em><\/strong><\/td>\n		 <\/td>\n<\/tr>\n
 <\/em><\/td>\n2020<\/strong><\/td>\n2019<\/strong><\/td>\n <\/strong><\/td>\n<\/tr>\n
Gold produced (oz)<\/strong><\/td>\n82,888<\/td>\n79,180<\/td>\n <\/strong><\/td>\n<\/tr>\n
Head grade (g\/t Au)<\/strong><\/td>\n7.8<\/td>\n8.7<\/td>\n <\/strong><\/td>\n<\/tr>\n
Ore mined (wet tonnes)<\/strong><\/td>\n357,674<\/td>\n308,387<\/td>\n <\/strong><\/td>\n<\/tr>\n
Mining rate (tpd)<\/strong><\/td>\n3,930<\/td>\n3,427<\/td>\n <\/strong><\/td>\n<\/tr>\n
Ore milled (dry tonnes)<\/strong><\/td>\n345,139<\/td>\n295,122<\/td>\n <\/strong><\/td>\n<\/tr>\n
Mill throughput (tpd)<\/strong><\/td>\n3,793<\/td>\n3,279<\/td>\n <\/strong><\/td>\n<\/tr>\n
Recovery (%)<\/strong><\/td>\n96.4<\/td>\n96.8<\/td>\n <\/strong><\/td>\n<\/tr>\n
Silver produced (oz)<\/strong><\/td>\n123,926<\/td>\n108,234<\/td>\n <\/strong><\/td>\n<\/tr>\n
Gold sold (oz)<\/strong><\/td>\n80,460<\/td>\n81,434<\/td>\n <\/strong><\/td>\n<\/tr>\n
Silver sold (oz)<\/strong><\/td>\n114,640<\/td>\n96,974<\/td>\n <\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Abbreviations: t (tonnes), tpd (tonnes per day), g\/t (grams per tonne), Au (gold) and oz (ounces).<\/em><\/p>\n

Key Financial Metrics<\/strong><\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
 <\/em><\/strong><\/td>\n3 months ended Mar 31,<\/em><\/strong>
<\/em><\/strong><\/td>\n		 <\/td>\n<\/tr>\n
In thousands of USD, except for per ounce data<\/em><\/td>\n2020<\/strong><\/td>\n2019<\/strong><\/td>\n <\/strong><\/td>\n<\/tr>\n
Revenue ($)<\/strong><\/td>\n126,560<\/td>\n103,119<\/td>\n <\/td>\n<\/tr>\n
Cost of sales ($)<\/strong><\/td>\n89,505<\/td>\n73,967<\/td>\n <\/td>\n<\/tr>\n
Cost of sales ($\/oz of gold sold1<\/sup>)<\/strong><\/td>\n1,112<\/td>\n908<\/td>\n <\/td>\n<\/tr>\n
Earnings from mine operations ($)<\/strong><\/td>\n37,055<\/td>\n29,152<\/td>\n <\/td>\n<\/tr>\n
Net earnings ($)<\/strong><\/td>\n6,237<\/td>\n4,166<\/td>\n <\/td>\n<\/tr>\n
Net earnings ($\/share)<\/strong><\/td>\n0.03<\/td>\n0.02<\/td>\n <\/td>\n<\/tr>\n
Adjusted earnings ($)1<\/sup><\/strong><\/td>\n25,863<\/td>\n16,527<\/td>\n <\/td>\n<\/tr>\n
Adjusted earnings ($\/share)1<\/sup><\/strong><\/td>\n0.14<\/td>\n0.09<\/td>\n <\/td>\n<\/tr>\n
Cash generated by operating activities ($)<\/strong><\/td>\n52,538<\/td>\n39,944<\/td>\n <\/td>\n<\/tr>\n
Free cash flow ($)1<\/sup><\/strong><\/td>\n41,803<\/td>\n35,019<\/td>\n <\/td>\n<\/tr>\n
AISC ($\/oz)1<\/sup><\/strong><\/td>\n996<\/td>\n868<\/td>\n <\/td>\n<\/tr>\n
Average realized price ($\/oz)1<\/sup><\/strong><\/td>\n1,605<\/td>\n1,319<\/td>\n <\/td>\n<\/tr>\n
Average realized cash margin ($\/oz)1<\/sup><\/strong><\/td>\n768<\/td>\n571<\/td>\n <\/td>\n<\/tr>\n
Long-term debt ($)2<\/sup><\/strong><\/td>\n382,831<\/td>\n460,286<\/td>\n <\/td>\n<\/tr>\n
Cash & cash equivalents ($)<\/strong><\/td>\n40,566<\/td>\n50,868<\/td>\n <\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
    \n
  1. Refer to the “Non-IFRS Financial Performance Measures” section at the end of this news release for reconciliation.<\/em><\/li>\n
  2. As at March 31, 2020, long-term debt does not include the current portion of the Company’s Loan Facility in the amount of $66,667 (2019 – $75,687).<\/li>\n<\/ol>\n

    First Quarter 2020 Production Overview<\/strong><\/p>\n