Richmont Mines

Richmont Mines Reports Strong Third Quarter Financial Results Driven by Record Gold Production and Solid Cost Performance at Island Gold

Toronto (ots/PRNewswire) - Richmont Mines Inc. (TSX: RIC) (NYSE: RIC) ("Richmont" or the "Corporation") announces operating and financial results for the three and nine months ended September 30, 2017. (All amounts are in Canadian dollars, unless otherwise indicated.)

THIRD QUARTER AND NINE-MONTH HIGHLIGHTS - CONTINUING OPERATIONS[(1)]

- Revenues of $36.5 (US$29.2) million for the quarter and $123.4 
  (US$94.3) million for the nine-month period.
- Net earnings of $4.8 (US$3.8) million, or $0.08 (US$0.06) per share
  for the quarter and $21.7 (US$16.6) million, or $0.34 (US$0.26) per
  share for the nine-month period.
- Record production of 26,659 ounces of gold (22,666 ounces sold) for
  the quarter and 76,541 ounces of gold (74,849 ounces sold) for the 
  nine-month period, positioning the Island Gold Mine to exceed the 
  high end of annual production guidance of between 87,000 and 93,000
  ounces.
- Cash costs[(2)] of $666 (US$532) per ounce for the quarter and $637
  (US$487) per ounce for the nine-month period. The Island Gold Mine 
  remains on track to beat the lower end of annual cash cost guidance
  of between $715 and $765 (US$550 to US$590) per ounce.
- All-In-Sustaining Costs[(2)] ("AISC") for the Island Gold Mine were
  $886 (US$708) per ounce for the quarter and $796 (US$609) per ounce
  for the nine-month period. The Island Gold Mine remains on track to
  beat the lower end of annual AISC guidance of between $945 and $995
  (US$725 and US$765) per ounce.
- AISC for continuing operations, including all corporate overhead, 
  was $1,038 (US$829) per ounce for the quarter and $921 (US$704) per
  ounce for the nine-month period.
- Operating cash flow from the Island Gold Mine was $14.5 (US$11.6) 
  million for the quarter and $62.2 (US$47.5) million for the 
  nine-mine period. Operating cash flow[(2)] (before changes in 
  non-cash working capital), including all corporate overhead, was 
  $11.5 (US$9.2) million for the quarter, or $0.18 (US$0.14) per 
  share, and $50.6 (US$38.7) million for the nine-month period, or 
  $0.80 (US$0.61) per share.
- The Island Gold Mine generated strong free cash flow of $4.4 
  (US$3.5) million for the quarter and $31.8 (US$24.3) million for 
  the nine-month period. Net free cash flow[(2)], including all 
  corporate overhead, was $1.8 (US$1.4) million for the quarter, or 
  $0.03 (US$0.02) per share, and $21.0 (US$16.0) million for the 
  nine-month period, or $0.33 (US$0.25) per share.
- Cash balance at the end of the quarter was approximately $90.0 
  (US$72.1) million. As a result of timing, the finished goods 
  inventory at the end of the quarter consisted of approximately 
  2,000 gold ounces. These ounces were sold in the fourth quarter.
- Year to date, Island Gold has continued to outperform the 2017 
  Expansion Case Preliminary Economic Assessment ("PEA") on all key 
  metrics, which demonstrates the significant upside potential of 
  this asset.
- The mill expansion to 1,100 tonnes per day advanced during the 
  quarter and the operation is anticipated to achieve the target run 
  rate in the latter part of 2018.
- On September 11, 2017, Richmont announced that it had entered into 
  a definitive agreement with Alamos Gold ("Alamos") whereby Alamos 
  will acquire all of the issued and outstanding shares of Richmont 
  pursuant to a plan of arrangement. The transaction is expected to 
  close on, or about, November 23, 2017. 

"The positive results we have reported were supported by another consecutive quarter of solid performance from the Island Gold Mine. This high-quality operation delivered record production at peer leading cash costs, which positions Island Gold to beat annual guidance for the third consecutive year. Year to date, the Island Gold Mine has generated a strong free cash flow stream of $31.8 million, which will increase significantly once the level of capital investment decreases to sustaining levels post 2018," commented Renaud Adams, President and CEO. He continued, "During the quarter, we announced a transaction with Alamos that is consistent with our commitment to create significant shareholder value. As part of this strategic transaction, our shareholders will maintain exposure to the ongoing potential of the Island Gold Mine and benefit from having meaningful ownership in a diversified intermediate producer with a proven and experienced management team."



_______________________
[1]   Continuing operations includes the Island Gold Mine and 
corporate overhead. The
Beaufor Mine, the Camflo Mill, the Monique Mine, the 
Wasamac development project
and all other mineral claims, mining leases and mining 
concessions located in the
province of Quebec are reported as discontinued operations.
Refer to the Q3
Management's Discussion and Analysis for further details.  

[2]   Refer to the Non-IFRS Performance Measures disclosure 
presented at the end of this
press release. 


Financial and Operating Highlights - Continuing Operations[(1)]




Quarter    Quarter   
Nine-Months  Nine-Months
ended      ended     
ended         ended
Sept.30,   Sept.30,   
Sept.30,     Sept.30,
2017       2016      
2017         2016
(in thousands of $, except
per share and per oz amounts)                          
Gold produced (oz)                          26,659     14,031    
76,541      59,237
Gold sold (oz)                              22,666     13,673    
74,849      59,851
Cash costs per ounce ($)[(2)]                  666        947    
637         761
AISC per ounce ($)[(2)]                      1,038      1,463    
921       1,134
Realized gold price per ounce ($)            1,608      1,756    
1,644       1,657
Revenue from mining operations              36,549     24,053   
123,363      99,378
Net earnings (per share)                      0.08       0.01    
0.34        0.18
Operating cash flow, per share[(2)]           0.19       0.05    
0.81        0.53
Operating cash flow (before non-cash
changes in working capital), per
share[(2)]                                    0.18       0.08    
0.80        0.59
Sustaining Capital ($)                       4,984      5,090    
11,933      15,283
Project Capital ($)                         10,042     13,457    
21,941      28,390
Net free cash flow, per share[(2)]            0.03     (0.24)    
0.33      (0.18)
Revenue from mining operations (US$)        29,174     18,431    
94,336      75,184
Net earnings (per share) (US$)                0.06       -       
0.26        0.13
Operating cash flow, per share[(2)] (US$)     0.15       0.04    
0.62        0.40
Operating cash flow (before non-cash
changes in working capital), per
share[(2) ](US$)                              0.14       0.06    
0.61        0.45
Sustaining Capital (US$)                     3,978      3,900    
9,125      11,562
Project Capital (US$)                        8,016     10,312    
16,778      21,478
Net free cash flow, per share[(2) ](US$)      0.02     (0.18)    
0.25      (0.14) 


[(1)] Continuing operations includes the Island Gold Mine and 
corporate overhead.
[(2)] Non-IFRS performance measure. Refer to the Non-IFRS 
performance measures section
contained in the Q3 2017 Management's Discussion and 
Analysis. 

Island Gold Mine: Operational Highlights

Year to date, the Island Gold Mine has outperformed the PEA on all key operating and financial metrics including tonnes mined and milled, grades and unit operating costs, all of which has supported a significant free cash flow stream of $31.8 (US$24.3) million.

- Underground mine and mill productivities of 1,028 and 931 tonnes 
  per day year to date (1,055 and 946 tonnes per operating day), 
  respectively, as compared to the 1,000 tonnes per day and 900 
  tonnes per day considered in the PEA. Following underground mine 
  infrastructure improvements completed during the quarter, the mill 
  is now operating at an average of nearly 1,000 tonnes per day.
- Unit operating costs of $182 (US$139) per tonne, below the $204 
  (US$151)/tonne considered in the PEA.
- The mill upgrade to 1,100 tonnes per day mill is currently underway
  and advancing well on schedule. A ball mill has been sourced and is
  currently being refurbished, detailed engineering has been 
  completed and earthworks started in the third quarter. The mill 
  target run rate is anticipated to be achieved in the latter part of
  2018.
- Upgrade of the mining infrastructure to support the expanded 
  capacity has advanced in the third quarter. Surface fans have been 
  upgraded to increase mine ventilation and new underground pumping 
  stations have been commissioned. Additional mining equipment, such 
  as trucks and scoops, have been ordered with deliveries estimated 
  for the first half of 2018. 


Consolidated Highlights - Continuing and Discontinued 
Operations[(1)]

Quarter    Quarter   
Nine-Months  Nine-Months
ended      ended     
ended         ended
Sept.30,   Sept.30,   
Sept.30,     Sept.30,
(in thousands of $, except                  2017       2016      
2017         2016
per share and per oz amounts)                                    

Gold produced (oz)                         30,039     18,856     
90,689       74,545
Gold sold (oz)                             26,287     17,774     
89,855       74,901
Cash costs per ounce ($)[(2)]                 840      1,054     
783          892
AISC per ounce ($)[(2)]                     1,259      1,595     
1,101        1,289
Realized gold price per ounce ($)           1,608      1,754     
1,644        1,659
Revenue from mining operations             42,378     31,244    
148,118      124,496
Net earnings (per share), basic              0.03       -        
0.28         0.19
Operating cash flow, per share[(2)]          0.13       0.05     
0.81         0.59
Operating cash flow (before non-cash
changes in working capital), per
share[(2)]                                   0.15      0.09      
0.80         0.64
Net free cash flow, per share[(2)]          (0.05)   (0.26)      
0.26       (0.20)
Revenue from mining operations (US$)        33,827   23,942     
113,266       94,187
Net earnings (per share) (US$)                0.02      -        
0.21         0.14
Operating cash flow, per share[(2)] (US$)     0.10     0.04      
0.62         0.44
Operating cash flow (before non-cash
changes in working capital), per
share[(2) ](US$)                              0.12     0.07      
0.61         0.48
Net free cash flow, per share[(2) ](US$)    (0.04)   (0.20)      
0.20        (0.15) 


[(1)] Continuing operations includes the Island Gold Mine and 
corporate overhead. The
Beaufor Mine, the Camflo Mill, the Monique Mine, the 
Wasamac development project
and all other mineral claims, mining leases and mining 
concessions located in
the province of Quebec are reported as discontinued 
operations. Refer to the Q3
Management's Discussion and Analysis for further details.
[(2)] Non-IFRS performance measure. Refer to the Non-IFRS 
performance measures section
contained in the Q3 2017 Management's Discussion and 
Analysis. 

Upcoming News and Events

- Special Meetings of Richmont and Alamos Shareholders (Nov. 16)
- Closing of the Richmont / Alamos Transaction (on, or about, Nov. 
  23) 

Financial Statements and Management's Discussion and Analysis

The financial statements and related Management's Discussion and Analysis can be found on the Corporation's website at http://www.richmont-mines.com or under the Corporation's profile on http://www.sedar.com and with the Securities and Exchange Commission at http://www.sec.gov/edgar.shtml.

Non-International Financial Reporting Standards ("IFRS") Performance Measures

In this press release, the terms "cash costs per ounce", "all-in sustaining costs", "net free cash flow" and "operating cash flow" are used, which are non-IFRS performance measures, and may not be comparable to similar measures presented by other companies. The Corporation believes that, in addition to conventional measures prepared in accordance with IFRS, the Corporation and certain investors use this information to evaluate the Corporation's performance. Accordingly, these non-IFRS measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. For full disclosure and reconciliation of these measures, refer to the Non-IFRS Performance Measures section contained in the Q3 2017 Management's Discussion and Analysis.

About Richmont Mines Inc.

Richmont Mines currently produces gold from the Island Gold Mine in Ontario and is also advancing development of the significant high-grade resource extension to the east and at depth. With more than 35 years of experience in gold production, exploration and development, and prudent financial management, the Corporation has successfully positioned the Island Gold Mine to cost-effectively build its Canadian reserve base and to 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", "objective" 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's 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 United States Securities and Exchange Commission (the "SEC"). The requirements of National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") adopted by the Canadian Securities Administrators differ significantly from the requirements of the SEC.

U.S. Investors are urged to consider the disclosure in our annual report on Form 40-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.

National Instrument 43-101

The scientific or technical information in this news release has been reviewed by Mr. Daniel Adam, Geo., Ph.D., Vice-President, Exploration, an employee of Richmont Mines Inc., and a qualified person as defined by NI 43-101.

Contacts:

Renaud Adams,

President and CEO,

Phone: +1-416-368-0291 ext. 101



Anne Day

Senior Vice-President,

Investor Relations

Phone: +1-416-368-0291 ext. 105
 

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