Kirkland Lake Gold Reports Strong Year-Over-Year Q1 Production Growth
Apr 06 2018
TORONTO, April 06, 2018 (GLOBE NEWSWIRE) -- Kirkland Lake Gold Ltd. (“Kirkland Lake Gold” or the “Company”) (TSX:KL) (NYSE:KL) (ASX:KLA) today announced solid quarterly production for the first quarter of 2018 (“Q1 2018”). A total of 147,644 ounces was produced in Q1 2018, an increase of 13% from the first quarter of 2017 (“Q1 2017”). Q1 2018 production exceeded target levels for the quarter, driven by record monthly production in March of 71,615 ounces, which largely reflected positive grade performance at both Fosterville and Macassa. The Company remains on track to achieve its full-year 2018 production guidance of over 620,000 ounces, with production volumes to increase in the second half of the year, including at Fosterville with the commencement of stope production from the Swan Zone. All dollar amounts are expressed in U.S. dollars, unless otherwise noted.
During Q1 2018, the Company continued to build financial strength with cash and cash equivalents increasing $43.8 million or 19%, to $275.4 million at March 31, 2018 compared to $231.6 million at December 31, 2017.
Highlights of Q1 2018 production results:
Consolidated Q1 2018 production of 147,644 ounces, which compared to 130,426 ounces of production in Q1 2017 and record quarterly production of 166,579 ounces in the fourth quarter of 2017 (“Q4 2017”)
Record quarterly production at Macassa totaling 54,038 ounces in Q1 2018, an increase of 11% from 48,723 ounces in Q1 2017 and 5% from 51,608 ounces produced in Q4 2017 (record monthly production in March 2018 of 30,319 ounces at an average grade of 27.6 g/t)
Solid results at Fosterville in Q1 2018 with production totaling 63,843 ounces, 39% higher than 46,083 ounces in Q1 2017 and compared to record quarterly production of 79,157 ounces in Q4 2017 (March 2018 production of 29,463 ounces at an average grade of 20.4 g/t, Fosterville’s second best monthly production performance)
Production at Holt of 16,675 ounces in Q1 2018, a 9% increase from 15,318 ounces in Q1 2017 and compared to record production of 19,263 ounces the previous quarter
Production at Taylor of 13,055 ounces compared to 10,942 ounces in Q1 2017 and record production of 16,541 ounces in Q4 2017.
Other key developments during Q1 2018, include:
December 31, 2017 Mineral Reserve and Mineral Resource estimates released
• Consolidated Mineral Reserves increased 36% to 4,640,000 ounces @ 11.1 grams per tonne (“g/t”)
• Fosterville Mineral Reserves increased 247% year over year, to 1,700,000 ounces @ 23.1 g/t, with a Swan Zone Mineral Reserve of 1,160,000 ounces @ 61.2 g/t
• Macassa Mineral Reserves at December 31, 2017 totaled 2,030,000 ounces @ 21.0 g/t, with Measured and Indicated Mineral Resources increasing 58% to 2,090,000 ounces @ 17.1 g/t and Inferred Mineral Resources increasing 48% to 1,370,000 ounces @ 22.2 g/t
Strong growth in earnings and cash flow for full-year 2017 reported
• Earnings from continuing operations in 2017 totaled $157.3 million ($0.76 per basic share), a 95% increase from 2016
• Cash flow from operating activities of continuing operations totaled $309.8 million, a 66% increase from 2016, while free cash flow increased 56%, to $178.0 million in 2017
Continued focus on shareholder returns
• Quarterly dividend payment of $0.02/share paid on January 15, 2018.
Tony Makuch, President and Chief Executive Officer of Kirkland Lake Gold, commented: “We had a solid start to 2018 and finished the first quarter with record monthly production in March of 71,615 ounces. In Canada, all our mines performed well in Q1 2018, with Macassa achieving record quarterly production and both Holt and Taylor exceeding target production levels for the quarter. In Australia, Fosterville finished the quarter ahead of plan, reflecting positive grade reconciliations, with production increasing 39% from Q1 2017. Entering the second quarter, we are very much on track to achieve our consolidated production guidance for 2018 of more than 620,000 ounces. Based on our strong performance in Q1 2018, we continued to build financial strength, with our cash position increasing 19% during the quarter to $275.4 million at March 31, 2018.
“Among other key catalysts in Q1 2018 was the release of our December 31, 2017 Mineral Reserve and Mineral Resource estimates. The fact that we more than tripled Mineral Reserves at Fosterville and grew Measured and Indicated and Inferred Mineral Resources at Macassa by 58% and 48%, respectively, in 2017 provides a powerful demonstration of the growth potential of our assets. Attractive organic growth is one of our key pillars of value creation. With our current business portfolio, we are poised for solid year-over-year production growth to a million ounces of annual production over the next five to seven years.”