Richmont Mines

Richmont Mines Announces Positive Revisions to 2016 Guidance

Toronto (ots/PRNewswire) - Potential Production Increase at Island Gold of up to 45% over 2015

Richmont Mines Inc. (TSX: RIC) (NYSE MKT: RIC) ("Richmont" or the "Corporation") announces a positive revision to its 2016 operational guidance estimates driven by significantly better than expected performance from the Island Gold Mine. (All amounts are in Canadian dollars, unless otherwise indicated).

- Company-wide annual gold production guidance estimates have 
  increased to between 98,000 and 106,000 ounces, from 87,000 to 
  97,000 ounces, supported by a potential 45% annual production 
  increase at the Island Gold Mine.
- The Corporation is also revising the Canadian to US dollar exchange
  rate assumptions to 1.33 Canadian dollars to the US dollar for the 
  period January to June and 1.30 Canadian dollars to the US dollar 
  for the balance of the year, due to the strengthening of the 
  Canadian dollar during the year. The original guidance estimates 
  issued on February 11, 2016 assumed an exchange rate of 1.364.
- Company-wide annual cash cost[1] guidance estimates have decreased 
  to between $885 and $945 per ounce (US$675 and US$720 per ounce), 
  from $930 to $1,000 per ounce (US$680 to US$730 per ounce), 
  supported by the increased contribution of higher quality, lower 
  cost ounces from the Island Gold Mine.
- Company-wide annual All-in Sustaining Costs[1] ("AISC") guidance 
  estimates have decreased to between $1,230 and $1,335 per ounce 
  (US$935 and US$1,015 per ounce), from $1,275 to $1,390 per ounce 
  (US$935 to US$1,015 per ounce), supported by the strong AISC 
  performance from the Island Gold Mine. 

During the balance of the year, the Corporation will continue to leverage the higher gold price and weak Canadian dollar and has strategically increased and reallocated capital investment initiatives, which will best position the Island Gold Mine, this core asset for long-term success.

- Company-wide annual exploration expenditure guidance estimates have
  increased to $17.1 million (US$13.1 million), from $15.5 million 
  (US$11.4 million), which includes an additional 22,000 metres 
  ($1.65 million) of drilling at the Island Gold Mine that will focus
  on defining potential new resources in the fourth mining horizon 
  located between the 860 and 1,000 metre levels, which could be 
  incorporated into the short to medium term mine plan.
- Company-wide annual sustaining capital investment guidance 
  estimates have increased to $25.9 million (US$19.7 million), from 
  $24.1 million (US$17.7 million), primarily related to advancing 
  development of the east ramp ($1.3 million) at the Island Gold 
  Mine, which had previously been allocated to project capital.
- Annual project capital investment guidance estimates for the Island
  Gold Mine have increased to $46.1 million (US$35.2 million), from 
  $43.4 million (US$31.8 million), primarily related to 
  infrastructure improvements, including a new surface maintenance 
  and warehouse facility ($2.9 million) and ventilation optimization 
  ($1.5 million), partially offset by the $1.3 million related to 
  development of the east ramp, which has been reallocated to 
  sustaining capital. 

___________________________________

[ 1] Cash cost and AISC are Non-IFRS measures. Refer to the Non-IFRS performance measures section in the second quarter MD&A.

"These positive revisions to our annual guidance estimates are supported by the strong performance from our cornerstone Island Gold Mine to date, demonstrating the potential of this quality, low-cost asset. We have also successfully completed the electrical upgrade at Island Gold, which was a key initiative for Richmont as it will support ongoing productivity improvements as well as expansion opportunities." stated Renaud Adams, CEO of Richmont Mines. He continued, "At the Beaufor Mine, we are seeing improved production following the launch of stope mining in the higher grade Q Zone in August and we expect to report increased production and reduced costs over the balance of the year."

2016 Company-Wide Operational Estimates

   

    Revised 2016                                    Original  
Revised
    Operational                              
2016                       2016
     Estimates               
Guidance                   Guidance
    Gold 
Ounces Produced(1)                      87,000 - 97,000          
98,000 - 106,000
    Cash Costs per Ounce (CAD$)(2)                 
$930 - $1,000               $885 - $945
    Sustaining Capital per 
Ounce (CAD$)              $250 - $280               $250 - $280

Corporate G&A per Ounce (CAD$)                    $95 - $110         
$95 - $110
    All-in Sustaining Costs per Ounce (CAD$)(2)  
$1,275 - $1,390           $1,230 - $1,335
    Cash Costs per Ounce 
(US$)(2)(3)                 $680 - $730               $675 - $720

Sustaining Capital per Ounce (US$)(3)            $185 - $205         
$185 - $205
    Corporate G&A per Ounce (US$)(3)                
$70 - $80                 $75 - $90
    All-in Sustaining Costs per
Ounce (US$)(2)(3)  $935 - $1,015             $935 - $1,015


Revised 2016 Capital                            Original             
Revised 
    and Exploration ($M)                              
2016                       2016

Guidance                   Guidance
    Sustaining 
Capital (CAD$)                              $24.1                    
$25.9
    Project Capital (CAD$)                                 
$43.4                    $46.1
    Company-wide Exploration (CAD$)   
$15.5                    $17.1

    Sustaining 
Capital (US$)(3)                            $17.7                    
$19.7
    Project Capital (US$)(3)                               
$31.8                    $35.2
    Company-wide Exploration (US$)(3) 
$11.4                    $13.1

    (1) Revised 
guidance estimates include 1,165 ounces produced from the Monique 
Mine in
    Q1 2016, which were not included in original guidance.


(2) Cash cost and AISC are Non-IFRS measures. Refer to the Non-IFRS
performance
    measures section in the second quarter MD&A.

    (3)
An exchange rate of 1.36 Canadian dollars to 1.00 US dollar was used 
for the
    original 2016 guidance issued on Feb. 11, 2016. The 
revised guidance assumes an
    exchange rate of 1.33 for January to 
June and 1.30 for July to December.
   
 

Island Gold Mine: 2016 Guidance Update

Based on the strong performance during the first six months of the year from the Island Gold Mine and following the completion of a 25-day shutdown for an electrical upgrade in August 2016, operational guidance estimates have been positively revised.

- Annual gold production guidance estimates have increased to between
  75,000 and 80,000 ounces, from 62,000 to 67,000 ounces, a potential
  increase of up to 45% over 2015 production.
- Annual cash cost guidance estimates have decreased to between $800 
  and $840 per ounce (US$610 and US$640 per ounce), from $900 to $960
  per ounce (US$660 to US$705 per ounce), a potential decrease of up 
  to 23% over 2015 cash costs.
- Annual AISC guidance estimates have decreased to between $1,040 and
  $1,110 per ounce (US$795 and US$845 per ounce), from $1,160 and 
  $1,250 per ounce (US$850 to US$920 per ounce), a potential decrease
  of up to 29% over 2015 AISC.
- Exploration expenditure guidance estimates for 2016 have increased 
  to $16.0 million (US$12.2 million), from $14.4 million (US$10.6 
  million), which includes an additional 22,000 metres of drilling 
  that will focus on defining new resources in the fourth mining 
  horizon located between the 860 and 1,000 metre levels, which could
  be incorporated into the short to medium term mine plan.
- Sustaining capital investment guidance estimates for 2016 have 
  increased to $18.9 million (US$14.4 million), from $17.3 million 
  (US$12.7 million), primarily related to advancing the development 
  of the east ramp ($1.3 million), which had previously been 
  allocated to project capital. 

Annual project capital guidance estimates for 2016 have increased to $46.1 million (US$35.2 million), from $43.4 million (US$31.8 million), which includes a new surface maintenance and warehouse facility ($2.9 million) and ventilation optimization ($1.5 million), partially offset by the $1.3 million in development of the east ramp, which has been reallocated to sustaining capital.

   

                                Island Gold Revised 2016 
Guidance Estimates
    Revised 2016                                  
Original                  Revised 
    Operational                 
2016                      2016
     Estimates  
Guidance                  
Guidance
    Gold Ounces Produced                         62,000 - 
67,000          75,000 - 80,000
    Cash Costs per Ounce (CAD$)(1)   
$900 - $960              $800 - $840
    Sustaining 
Capital per Ounce (CAD$)              $260 - $290              $240 -
$270
    All-in Sustaining Costs per Ounce (CAD$)(1)  $1,160 - $1,250
$1,040 - $1,110

    Cash Costs per Ounce (US$)(1)(2)       
$660 - $705              $610 - $640
    Sustaining Capital
per Ounce (US$)(2)             $190 - $215              $185 - $205

All-in Sustaining Costs per Ounce (US$)(1)(2)     $850 - $920      
$795 - $845

    Revised 2016 Capital                         
Original                  Revised
    and Exploration ($M)        
2016                      2016

Guidance                  
Guidance
    Sustaining Capital (CAD$)                               
$17.3                   $18.9
    Project Capital (CAD$)             
$43.4                   $46.1
    Exploration 
(CAD$)                                      $14.4                   
$16.0

    Sustaining Capital (US$)(2)                             
$12.7                   $14.4
    Project Capital (US$)(2)           
$31.8                   $35.2
    Exploration 
(US$)(2)                                    $10.6                   
$12.2

    (1) Cash cost and AISC are Non-IFRS measures. Refer to the
Non-IFRS performance
    measures section in the second quarter MD&A.

    (2) An exchange rate of 1.36 Canadian dollars to 1.00 US 
dollar was used for the
    original 2016 guidance issued on Feb. 11,
2016. The revised guidance assumes
    an exchange rate of 1.33 for 
January to June and 1.30 for July to December.
   
 

Beaufor Mine and Quebec Division: 2016 Guidance Update

Gold production in the first six months of the year was impacted by lower grades mined in the upper zones and a delay in mining from the higher grade Q Zone, however production is expected to increase over the balance of the year as stope mining in the Q Zone began in early August.

- Annual gold production guidance estimates for the Quebec Division 
  have reduced to between 23,000 and 26,000 ounces, which includes 
  1,165 ounces produced from Monique Mine in the first quarter. At 
  the Beaufor Mine production is expected to significantly increase 
  over the balance of the year as stope mining is focused in the 
  higher grade Q Zone.
- Due to the lower than planned production levels from the Beaufor 
  Mine in the first six months of the year, annual cash cost guidance
  estimates have increased to between $1,150 and $1,300 per ounce 
  (US$875 and US$1,000 per ounce).
- Annual AISC guidance estimates have increased to between $1,420 and
  $1,610 per ounce (US$1,080 and US$1,235 per ounce).
- As production from the Beaufor Mine is expected to increase over 
  the balance of the year, cash costs and AISC are expected to 
  decrease, which we anticipate will result in positive free cash 
  flow generation for the year. 
   

                               Quebec Division Revised 2016 
Guidance Estimates
    Revised 2016                                  
Original                Revised
    Operational                
2016                    2016

Estimates                                           Guidance         
Guidance
    Gold Ounces Produced(1)                          
25,000 - 30,000        23,000 - 26,000
    Cash Costs per Ounce 
(CAD$)(2)                   $1,000 - $1,060        $1,150 - $1,300

Sustaining Capital per Ounce (CAD$)                  $230 - $270    
$270 - $310
    All-in Sustaining Costs per Ounce (CAD$)(2)   
$1,230 - $1,330        $1,420 - $1,610

    Cash Costs per Ounce 
(US$)(2)(3)                     $735 - $780          $875 - $1,000

Sustaining Capital per Ounce (US$)(3)                $170 - $195    
$205 - $235
    All-in Sustaining Costs per Ounce (US$)(2)(3) 
$905 - $975        $1,080 - $1,235

    Revised 2016 Capital 
and Exploration ($M)            Original                Revised

2016            
2016

Guidance                Guidance
    Sustaining Capital (CAD$)       
$6.8                   $7.0
    Project 
Capital (CAD$)                                        -              
-
    Exploration (CAD$)                                      
$1.1                   $1.1

    Sustaining Capital (US$)(3)       
$5.0                   $5.3
    Project 
Capital (US$)(3)                                      -              
-
    Exploration (US$)(3)                                    
$0.8                   $0.8
    (1) Revised guidance estimates 
include 1,165 ounces produced from the Monique Mine
    in Q1 2016, 
which were not included in original guidance.
    
    (2)Cash cost 
and AISC are Non-IFRS measures. Refer to the Non-IFRS performance

measures section in the second quarter MD&A.

    (3)An exchange rate
of 1.36 Canadian dollars to 1.00 US dollar was used for the

original 2016 guidance issued on Feb. 11, 2016. The revised guidance 
assumes an
    exchange rate of 1.33 for January to June and 1.30 for
July to December.
 

About Richmont Mines Inc.

Richmont Mines has produced over 1.6 million ounces of gold from its operations in Quebec, Ontario and Newfoundland since beginning production. The Corporation currently produces gold from the Island Gold Mine in Ontario, and the Beaufor Mine in Quebec. The Corporation is also advancing development of the significant high-grade resource extension at depth of the Island Gold Mine in Ontario. With 35 years of experience in gold production, exploration and development, and prudent financial management, the Corporation is well-positioned to cost-effectively build its Canadian reserve base and to successfully enter its next phase of growth.

Forward-Looking Statements

This news release contains forward-looking statements that include risks and uncertainties. When used in this news release, the words "estimate", "project", "anticipate", "expect", "intend", "believe", "hope", "may" and similar expressions, as well as "will", "shall" and other indications of future tense, are intended to identify forward-looking statements. The forward-looking statements are based on current expectations and apply only as of the date on which they were made. Except as may be required by law or regulation, the Corporation undertakes no obligation and disclaims any responsibility to publicly update or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise.

The factors that could cause actual results to differ materially from those indicated in such forward-looking statements include changes in the prevailing price of gold, the Canadian-United States exchange rate, grade of ore mined and unforeseen difficulties in mining operations that could affect revenue and production costs. Other factors such as uncertainties regarding government regulations could also affect the results. Other risks may be set out in Richmont Mines' Annual Information Form, Annual Reports and periodic reports. The forward-looking information contained herein is made as of the date of this news release.

Cautionary note to US investors concerning resource estimates

Information in this press release is intended to comply with the requirements of the Toronto Stock Exchange and applicable Canadian securities legislation, which differ in certain respects with the rules and regulations promulgated under the United States Securities Exchange Act of 1934, as amended ("Exchange Act"), as promulgated by the SEC. The Reserve and Resource estimates in this press release were prepared in accordance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101) adopted by the Canadian Securities Administrators. The requirements of NI 43-101 differ significantly from the requirements of the United States Securities and Exchange Commission (the "SEC").

U.S. Investors are urged to consider the disclosure in our annual report on Form 20-F, File No. 001-14598, as filed with the SEC under the Exchange Act, which may be obtained from us (without cost) or from the SEC's web site: http://sec.gov/edgar.shtml.

Renaud Adams, President and CEO, Phone: +1-416-368-0291 ext. 101; Anne Day, Vice-President, Investor Relations, Phone: +1-416-368-0291 ext. 105

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