Equinox Gold Reports Second Quarter 2024 Financial and Operating Results

Press Release

August 7, 2024

Equinox Gold Corp. (TSX: EQX, NYSE American: EQX) (“Equinox Gold” or the “Company”) is pleased to announce its second quarter 2024 summary financial and operating results. The Company’s unaudited condensed consolidated interim financial statements and related management’s discussion and analysis (“MD&A”) for the three and six months ended June 30, 2024 will be available for download on the Company’s profile on SEDAR+ at www.sedarplus.ca, on EDGAR at www.sec.gov/edgar and on the Company’s website at www.equinoxgold.com. The Company will host a conference call and webcast on August 8, 2024 commencing at 7:30 am Pacific Time to discuss second quarter results and activities underway at the Company. Further details are provided at the end of this news release.

Greg Smith, President and CEO of Equinox Gold, commented: “The highlight of the second quarter was achieving first gold pour at our new Greenstone Mine in Ontario. We also acquired our partner’s 40% interest in the mine and now hold 100% of this world-class asset. We remain on schedule to achieve commercial production at Greenstone during the third quarter.

“At our Mesquite mine, slower-than-planned recoveries affected Q2 production and at our Aurizona mine, a geotechnical event caused a temporary suspension of production for May and June. Post quarter end, we have transitioned to residual leaching at our small Phase 1 Castle Mountain mine while we advance engineering and permitting for the 200,000-ounce-per-year Phase 2 expansion. Our adjusted guidance reflects lower production from these assets in 2024, offset by higher production and lower costs from our increased ownership in Greenstone. We continue to expect substantially higher gold production and significantly lower costs in the second half of 2024.”

HIGHLIGHTS FOR THE THREE MONTHS ENDED JUNE 30, 2024

Operational

• Produced 122,221 ounces of gold
• Sold 115,423 ounces of gold at an average realized gold price of $2,328 per oz
• Total cash costs of $1,747 per oz and AISC of $2,041 per oz⁽¹⁾
• One fatality during the Quarter, as discussed in the Fazenda section of the MD&A
• No lost-time injuries; total recordable injury frequency rate⁽²⁾ of 1.82 per million hours worked for the 12-month rolling period (1.80 for the Quarter)
• Significant environmental incident frequency rate⁽²⁾ of 0.29 per million hours worked for the 12-month rolling period (0.00 for the Quarter)
• Temporarily suspended mining in the Piaba open pit at Aurizona following a geotechnical event as the result of persistent heavy rains; accelerated mining in the new Tatajuba open pit to mitigate the impact to productionEarnings
• Income from mine operations of $26.6 million
• Net income of $283.8 million or $0.72 per share (basic)
• Adjusted net loss of $5.8 million or $0.01 per share⁽¹⁾ (basic)Financial
• Cash flow provided by operations before changes in non-cash working capital of $45.1 million (cash flow used in operations of $33.0 million after changes in non-cash working capital)
• Adjusted EBITDA of $51.3 million⁽¹⁾
• Sustaining expenditures⁽¹⁾ of $31.0 million and non-sustaining expenditures of $82.6 million
• Cash and cash equivalents (unrestricted) of $167.5 million at June 30, 2024
• Net debt⁽¹⁾ of $1,308.9 million at June 30, 2024

Corporate

• On April 23, 2024, the Company announced its acquisition of the remaining 40% interest in Greenstone from Orion
  • At the date of announcement, consideration totaled $995 million and consisted of:
    • 42.0 million common shares of Equinox Gold valued at $250 million;
    • $705 million in cash payable on closing; and
    • $40 million in cash payable by December 31, 2024.
  • The Company closed the transaction on May 13, 2024, giving Equinox Gold 100% ownership of Greenstone. At the date of transaction close, consideration as measured for the purposes of financial reporting totaled $961 million⁽³⁾
  • Equinox Gold funded the cash consideration with net proceeds from a new $500 million three-year term loan (the “Term Loan”) and a bought deal equity financing of common shares of Equinox Gold at a price of $5.30 per common share (the “Offering”). The Offering, including an over-allotment option, closed on April 26, 2024 and Equinox Gold issued 56,419,000 common shares for aggregate gross proceeds of $299 million
• In connection with the Term Loan, entered into gold collar contracts with an average put strike price of $2,177 per oz and an average call strike price of $2,988 per oz, for a total of 279,996 ounces beginning July 2024 through to June 2026
• Extended maturity of 2019 and 2020 convertible notes:
  • Maturity date of the $139.7 million principal 5.00% convertible notes due April 12, 2024 extended by six months to October 12, 2024
  • Maturity date of the $139.3 million principal 4.75% convertible notes due March 10, 2025 extended by six months to September 10, 2025 and conversion price amended from $7.80 to $6.50
• Published the Company’s annual Environmental, Social & Governance (“ESG”) Report
• Announced the “Ride to Greenstone” fundraiser, a 3,634 km cycling relay commencing August 5, 2024 from Vancouver, BC to Geraldton, ON to raise money for the Geraldton District Hospital, with nearly C$1.2 million raised at the date of this news release

Development

• Commenced processing ore at Greenstone:
  • Ore introduced into the grinding circuit on April 6, 2024
  • Achieved first gold pour on schedule on May 22, 2024, with 16,247 oz of gold produced in Q2 2024
  • Advanced ramp-up, with commercial production expected by the end of Q3 2024

RECENT DEVELOPMENTS

• In August 2024, the Company will suspend mining at Castle Mountain for the duration of the Phase 2 permitting process; residual leaching and gold production is expected to continue through the remainder of the year
• Production and cost guidance updated to reflect the consolidation of the Company’s ownership of Greenstone, the suspension of mining at Castle Mountain until Phase 2 permitting is complete, slower-than-expected recoveries at Mesquite and the geotechnical event at Aurizona
  • Production estimated at 655,000 to 750,000 oz of gold with cash costs of $1,305 to $1,405 per oz and AISC of $1,635 to $1,735 per oz sold⁽⁴⁾
  • Sustaining expenditures⁽¹⁾ estimated at $210 million, non-sustaining expenditures estimated at $255 million

(1) Cash costs per oz sold, AISC per oz sold, sustaining capital, sustaining expenditures, adjusted net income, adjusted EBITDA, adjusted EPS, and net debt are non-IFRS measures. See Non-IFRS Measures and Cautionary Notes.
(2) Total recordable injury frequency rate (“TRIFR”) and significant environmental incident frequency rate (“SEIFR”) are both reported per million hours worked. TRIFR is the total number of injuries excluding those requiring simple first aid treatment.
(3) Refer to note 3 of the Company’s condensed consolidated interim financial statements for the three and six months ended June 30, 2024 for further details.

CONSOLIDATED OPERATIONAL AND FINANCIAL HIGHLIGHTS

Read More:

IBF4