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Pure Gold battles through Q1

Embattled miner Pure Gold’s revenue improved in the first quarter of the year but net losses got deeper as it continues with plans to achieve sustainable cash flow by the end of the year.
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The miner saw revenue of C$18.4 million for the three months, which is up from C$6.4 million a year earlier.

Pure Gold reported Q1 production of 6,653 ounces and sales of 7,876oz at a gold price of C$1,848oz sold. That compares to a year earlier when it produced 6,796oz and sold 2,924oz at a price of C$1,774/oz sold.

The company's net loss of C$21.5 million, or $0.05 per share, meanwhile, fell from losses of C$16.8 million, or C$0.04 per share in the same period of 2021.

On March 31, Pure Gold had a cash balance of C$6.5 million and total loans and borrowings of C$119.2 million.

Pure Gold owns and operates the PureGold mine in Red Lake, Ontario, Canada, which entered commercial production in 2021 following the construction of an 800tpd underground mine and processing facilities.

The company produced first gold at the mine in December 2020 and during that month, the company's share price crested at C$2.9 and has since been on a downward trajectory, reaching C$0.163 on May 17 of this week.

Pure Gold is working towards ramping up the mine to the 800tpd by the September quarter, reducing operating and sustaining capital costs by at least 30%, and achieving a sustainable positive site-level cash flow while completing critical trade-off studies in support of an updated mineral resource, reserve, and life of mine plan by the end of the year.

The company said that several new initiatives were launched during Q1 to achieve the goals.

"These initiatives include faster sill development to expedite access to higher grade stopes by developing sills faster, by taking longer rounds and improving definition drilling and grade control procedures," it said.

Production in the current quarter is expected to benefit from definition drilling in Q4 last year, it noted.

Pure Gold said it expects to see "sustainable increases in both ore throughput and head grade" progressively throughout the year.

Pure Gold has a market capitalization of C$77.19 million. The company's market capitalization had at one time been almost C$1 billion.