Fortitude Gold Corporation’s Q1 2024 financial report highlights a strong financial performance, with increased revenue and a positive outlook for the future. The company’s balance sheet and cash flow statements show growth in key areas, and management’s discussion and analysis of financial condition and results of operations provide insights into the company’s strategies and market position.
Overview of Financial Performance
Gold Resource Corporation reported net sales of $8.2 million in Q1 2024, a 65% decrease compared to $21.5 million in Q1 2023. Net loss was $2.0 thousand in Q1 2024 compared to net income of $6.4 million in Q1 2023. The decrease in sales and swing to a net loss was primarily driven by lower production and sales volumes of gold.
Gold production decreased 65% to 3,983 ounces in Q1 2024 from 11,487 ounces in Q1 2023. The lower production was attributed to mining lower grade ore from the Civit Cat area while awaiting permit approval to access higher grade ore from the Pearl pit.
Financial Metric | Q1 2024 | Q1 2023 | Change |
---|---|---|---|
Net Sales | $8.2 million | $21.5 million | -65% |
Net Income/(Loss) | ($2.0 thousand) | $6.4 million | -100% |
Gold Ounces Produced | 3,983 oz | 11,487 oz | -65% |
Revenue and Profit Trends
Revenue decreased 65% in Q1 2024 compared to Q1 2023, driven by a 65% decrease in gold ounces sold partially offset by a 10% increase in average realized gold price. The average realized gold price was $2,072/oz in Q1 2024 compared to $1,889/oz in Q1 2023.
Mine gross profit fell 66% from $12.3 million in Q1 2023 to $4.2 million in Q1 2024. Lower sales volumes were the primary driver of the decreased profitability.
General and administrative costs were flat at $1.2 million in Q1 2024 compared to $1.1 million in Q1 2023. Exploration expenses remained high at $3.6 million in Q1 2024 compared to $3.7 million in Q1 2023, as the company continued investing in exploration programs at East Camp Douglas, County Line, Isabella Pearl, and other properties.
Strengths and Weaknesses
Key strengths demonstrated during the quarter:
The clear weakness during the quarter was the low production and sales volumes resulting from mining lower grade ore. Grade-related operational challenges present the biggest risk to profitability in coming quarters if permitting delays continue to prevent mining higher grade ore.
Future Outlook
The outlook commentary indicates Gold Resource Corp expects improved production and financial performance in coming quarters based on the following factors:
The company’s liquidity position remains strong with cash and working capital to fund budgeted operations, exploration, and capital programs over the next 12 months. However, the Biden administration’s mining policies, BLM permitting delays, inflationary pressures, and other risk factors present uncertainties around the timing and level of production and earnings growth.
Financial Tables
Three months ended March 31 | 2024 | 2023 |
---|---|---|
Ore Mined (tonnes) | 66,496 | 106,475 |
Ore Grade (g/t) | 0.69 | 3.83 |
Gold Produced (oz) | 3,983 | 11,487 |
Gold Sold (oz) | 3,970 | 11,429 |
Average Gold Price | $2,072/oz | $1,889/oz |
Total Cash Cost | $661/oz | $499/oz |
AISC | $777/oz | $578/oz |
Non-GAAP Reconciliations
Three Months Ended March 31, 2024 |
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Total Cash Cost |
Treatment/Refining Charges |
Depreciation/Amortization |
Reclamation/Remediation |
Total Mine Cost of Sales |
Capital Resources
The company believes its liquidity position is adequate to fund budgeted expenditures over the next 12 months. However, low production, permitting delays, inflationary pressures, and other risks remain as uncertainties.