Newmarket Gold Reports Strong First Quarter 2016 Financial Results; Essentially Debt-Free; Fosterville Delivers Record Production and Low AISC of US$723
VANCOUVER, BRITISH COLUMBIA--(Marketwired - April 29, 2016) - Newmarket Gold Inc. ("Newmarket" or the "Company") (TSX:NMI)(OTCQX:NMKTF) is pleased to announce financial results for the three months ended March 31, 2016. All figures are in United States ("U.S.") dollars, unless otherwise stated. Full Financial Statements and Management Discussion & Analysis documents can be found at www.sedar.com and the Company's website, www.newmarketgoldinc.com.
First Quarter 2016 Highlights
Strong Financial Position: Cash position to $52.1 million as at the end of Q1, 2016, a $15.6 million increase from year-end. Working capital of $38.6 million at quarter-end and only $1.6 million in long-term debt following full conversion and redemption of convertible debentures. Solid First Quarter Gold Production: Consolidated gold production of 58,057 ounces increased 9.2% over Q4, 2015 and a decline of 2.7% over Q1, 2015. Record Quarterly Performance at flagship Fosterville Mine: Fosterville achieved record quarterly production of 33,138 ounces with record average grade of 7.34 g/t, up 28% year-over-year, and recovery of 86.8% Record Low All-In-Sustaining Costs ("AISC"): Record low consolidated AISC per ounce sold of $908 (2016 guidance of $950 to $1,025). Operating Cash Costs In-Line: Consolidated operating cash costs per ounce sold of $701 (2016 guidance of $650 to $725). Fosterville Achieves Low Operating Cash Costs and AISC: Fosterville operating cash costs and AISC per ounce sold of $473 and $723 respectively. Generating Free Cash Flow: Operating cash flow of $18.3 million or $0.13 per share based on basic weighted average number of shares outstanding, based on revenue of $66.1 million from 57,796 ounces sold.
Free cash flow of $8.9 million based on operating cash flow less capital expenditures of $9.4 million, and after investing $3.8 million into growth programs. Net Income: Net income of $6.5 million or $0.04 EPS, compared to net income of $15.7 million in Q1, 2015 or $0.13 EPS. Q1 2016 EPS reflects an increased weighted average number of shares outstanding as a result of the conversion and redemption of Debentures and the exercise of warrants during the quarter. Douglas Forster, President & CEO, Newmarket Gold commented: "Our strong first quarter performance reflects solid consolidated gold production of 58,057 ounces, operating cash costs of $701 and record low AISC of $908 per ounce sold. Costs continue to reflect our improving consolidated grade and recovery profile, largely driven by record grade at our flagship Fosterville mine, and cost containment initiatives. With our strong first quarter performance we generated $8.9 million in free cash flow, after investing $3.8 million in growth exploration, and we increased our cash position 43% to $52.1 million further strengthening our balance sheet. With the full conversion and redemption of our convertible debentures, which eliminates interest payments of C$2.8 million per year, we ended the quarter essentially debt-free with only $1.6 million in long-term debt on the balance sheet."
"Looking ahead, Newmarket is well positioned to achieve 2016 production and cost guidance. With a significantly higher grade profile and the commissioning of the gravity circuit at Fosterville, and improved grades and recoveries at Cosmo, we will continue to deliver positive operating results and generate significant cash flows this year. Additionally, we will continue to invest in near term exploration programs that support organic growth initiatives with the aim of adding quality ounces to support a multi-year goal of extending mine life across our operations."
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