Karora Resources, a multi-asset mineral resource company focused on precious metals acquisition, exploration, evaluation, and development, released on May 15 its Q1 2023 gold production figures, exceeding target levels. The company produced 39,827 ounces of gold this quarter, a whopping 45% increase from Q1 2022. Growth figures reflected 27% more tons processed and a 13% increase in average grade.
“We are off to a strong start in 2023, with record quarterly production exceeding target levels driven by grade outperformance and higher than expected tonnes mined and processed,” the company’s chairman and CEO, Paul Andre Huet, commented in the release.
With Q1’s major successes, Karora Resources remains on track to reach 2023’s target of 145,000 to 160,000 ounces.
The cash operating and all-in sustaining costs totaled at an average of $1,124 and $1,213 per ounce, respectively, compared to last year’s pricier averages of US$1,310 and US$1,396. The first quarter’s all-in-sustaining costs fall in line with the company’s yearly target for 2023 of $1,100 to $1,250 per ounce.
“Our unit costs are tracking in line with our 2023 plan and guidance and improved 14% from last year’s first quarter. We also continued to advance our capital programs on schedule and budget, with the second decline and first of three ventilation raises at Beta Hunt completed during the quarter,” Huet continued.
The company’s first-quarter revenue reached C$96.8 million, a 48% increase from Q1 2022, with 38% more gold sold, totaling at 36,145 ounces. Karora Resources set its quarterly record for these figures in Q4 2022 and has maintained it in recent months. Q1 showed an increase in working capital, however, from $38 million to $43.9 million.
“Our financial performance in the first quarter was solid, with revenue matching the record level we reported last quarter, operating earnings improving from both prior periods, and adjusted earnings more than tripling from a year ago. Operating cash flow was strong, and while we recorded a slight decline in our cash position (primarily related to reducing accounts payable), we saw an improvement in working capital from $38.0 million at year-end to $43.9 million at the end of the first quarter,” Huet explained.
Operating activities allowed Q1 2023 cash flow to more than double from 2022’s Q1 figure, increasing from C$12.2 million to C$28.6 million. The first quarter’s net loss of C$2.9 million improved from Q1 2022’s net loss of C$3.7 million.
Karora Resources’ adjusted earnings reached C$4.8 million compared to Q1 2022’s total of C$1.1 million. The company largely traces back its successes to its Beta Hut gold mine and the Higginsville gold operations in Western Australia, its current primary focus area of development, exploration, and growth.
“A highlight of the quarter was the continued emergence of Beta Hunt as a world-class mine with gold production of 26,577 ounces exceeding planned levels and increasing by 55% from a year ago and 27% from last quarter. The mine’s cost performance was excellent, with cash operating costs of $967 per ounce improving from both prior periods,” Huet explained.
Aside from its excellent output rates this quarter, Beta Hut also showed promising exploration activity in recent months, according to Huet. In the last few months, Karora Resources not only increased reserves but also continued drilling further into the mine, locating exciting growth potential for the coming year.
“We are equally confident that, within this world-class gold mine, we are well on our way to establishing a profitable, long-term nickel mining operation that will support further improvement in gold unit costs through higher byproduct credits,” Huet continued.
The Higginsville gold operations also exceeded Q1 2022’s output by 28%, with operating costs trending lower. The mine produced 13,250 ounces in Q1 2023, and the company expects even better results moving forward after ramping up production. “Cash operating costs improved from a year ago and are expected to trend lower, particularly later in the year when we commence open-pit mining at our Pioneer project,” Huet explained.
Karora Resources also controls the Spargos Reward project, another high-grade mine in Western Australia. As the company continues expanding efforts at each of its projects, we can expect to see more releases like Q1’s report in future months. With gold demand soaring across sectors, major mining corporations gain the ideal opportunity to capitalize on the growing investment needs.
“We expect to see cash growth resume over the course of the year as we execute our expansion plan and deliver operationally into the current strong gold price environment,” Huet concluded.