During the Second Quarter 2024 Results Conference Call, i-80 Gold Corp (ticker: IAU) disclosed a net loss of $36.8 million. Despite the loss, the company highlighted its continued investments in exploration and pre-development, with $5.1 million spent in the quarter and a total of $7.9 million in 2024. Production figures included 1,636 ounces from residual leaching at Ruby Hill and Lone Tree, and sales of 9,361 tons of oxide mineralized material from Granite Creek, generating $5.9 million in revenue. The company ended the quarter with $47 million in cash and $39 million in restricted cash, and announced the establishment of an at-the-market equity program for financial flexibility.
Key Takeaways:
– Quarterly net loss of $36.8 million
– $5.9 million revenue from Granite Creek sales
– $7.9 million invested in exploration and pre-development in 2024
– $47 million cash and $39 million restricted cash
– Establishment of at-the-market equity program
– Focus on converting exploration success into operational excellence
Company Outlook:
– Progressing with various mining projects
– Transition to toll milling of refractory ore at Granite Creek for increased liquidity
– Anticipated finalization of joint venture at Ruby Hill
– Considering potential asset sales but not currently pursuing mergers and acquisitions
InvestingPro Insights:
– Market capitalization of $353.5 million
– Revenue growth of 52.07% over the last twelve months
– Gross profit margin at -11.41%
– Analysts do not anticipate profitability this year
– Stock price volatility with negative returns
For a comprehensive analysis, additional insights for i-80 Gold Corp are available on InvestingPro’s website. The company reported a net loss for the quarter of $36.8 million or $0.10 per share. However, when adjusted for mark to market losses on the company’s convertible debt, outstanding warrants, gold prepay, and silver purchase and sale agreement, the loss decreased to $25.8 million or $0.07 per share. Despite this, the company continued to invest in exploration, evaluation, and pre-development, with $5.1 million invested during the quarter and a total of $7.9 million invested in 2024. This investment is focused on definition drilling at their projects to advance technical studies to feasibility level. The company also invested $15 million in the development of Granite Creek in the first six months of 2024.
The company ended the quarter with $47 million in cash and $39 million in restricted cash. They also announced the establishment of an at the market equity program to provide financial flexibility over the next 24 months with up to $50 million of additional liquidity.
Ewan Downie provided an update on the company’s projects, highlighting their portfolio of assets in Nevada, including strategically located projects with road access, grid power, and past producing mining operations. The company has six projects in Nevada, including high-grade gold deposits, oxide open pit projects, and polymetallic base metal deposits. They offer significant exploration upside as all deposits are open for expansion.
The company is focused on North Central Nevada, a highly productive gold district. They hold some of the highest grade development stage projects in North America and have the infrastructure in place to become a significant producer in the future. Lone Tree is their key processing facility, giving them a strategic advantage in Nevada’s changing oxide deposits landscape. With their multiple operations and processing facilities, the company is positioned to become a standalone long-term producer. We have a plan to feed this facility through the development of Granite Creek, Ruby Hill, and Cove. Granite Creek is our most advanced project, strategically located near the Turquoise Ridge Mine of Nevada Gold Mines. The South Pacific zone at Granite Creek has shown significant high-grade results, with potential for expansion. As we continue development, we are focusing on accessing ore in the South Pacific zone and improving water control. Our surface drilling campaign is aimed at finalizing the feasibility study for the property. We are also transitioning to an underground drilling campaign for increased efficiency. The South Pacific zone primarily consists of oxide mineralization at the uppermost level, with potential for refractory sulfide deposits in the future. Our focus is on developing sulfide mineralization for long-term sustainability. Our successful entry into the upper level and achievement of high grade portions exceeding 0.3 ounces per ton indicate a promising future, with more tonnage than expected mined from the uppermost level. The Cove project, located near Battle Mountain, is strategically positioned for mineral processing at our Lone Tree facility. Additionally, our Buffalo Mountain deposit shows potential with significant oxide intercepts. The ongoing drill program at Cove, where historic production has yielded millions of ounces of gold and silver, continues to deliver promising results. With underground development underway, we are focused on delineation drilling and feasibility studies to drive future growth. Ruby Hill, our flagship property, boasts a diverse mineralization profile and significant resource potential. Plans to advance base metals and sulfide mineralization through joint ventures and underground development are in progress. The completion of scoping studies and metallurgical work will further enhance the economic viability of our projects. As we continue to advance our exploration and development initiatives, we are confident in the long-term success of our operations. The image shows the preliminary mine design for the Ruby Deeps deposit, a refractory gold deposit that is part of the larger plan for the Lone Tree plant. Additional metallurgical work will be completed this year to explore ore sorting and other methods to potentially reduce transportation costs. At Mineral Point, test work for silver recoveries is ongoing, and hydrology work is being done for long-term mine planning. The discovery of the Hilltop zone in mid-2022 has led to the identification of four different known lenses with CRD and Skarn mineralization. The FAD project on the Gold Hill property is considered one of the highest-grade polymetallic deposits globally. Metallurgical work at FAD has been positive, and the company plans to advance it to resource status in the future. The company aims to convert resources to reserves, enhance financing options through technical studies, and deliver a long-term production plan. The goal is to turn exploration success into operational excellence. The question-and-answer session during the conference included discussions on oxide ore sales, toll milling of refractory ore, and revenue trends at Granite Creek. Matt Gili provided insights into the transition from oxide to refractory materials and the future direction of the property. Are we potentially looking at a doubling or tripling of the current amount after further development, or is it more about the scale of the operation? Any additional information on this would be appreciated.
Matt Gili: We are cautious in providing guidance, but we are definitely ramping up production at Granite Creek. The increased ore tons per day in June show that we are accessing more ore levels, which is a result of development efforts. Dewatering is a key focus for us in the first half of the year.
Don DeMarco: Can you provide some insight into the delays in finalizing the JV for Ruby Hill? Do you anticipate this being completed in the second half of this year or in 2025?
Ewan Downie: The delay in finalizing the JV is due to the importance of ensuring a solid partnership. We learned from past experiences and want to avoid any future issues. We are close to completing the partnership documentation and expect to finalize it before the end of the year.
Don DeMarco: Can you give an update on the CEO succession process that was announced a few months ago? Any additional information on the timing or reasons behind the decision?
Ewan Downie: The CEO succession plan was put in place two years ago, as I believe the company needs someone with more experience in operations. Health issues also played a role in this decision. I will continue as CEO for now, but a transition is planned for the future. We anticipate expanding on the image due to intercepts outside of the current shapes that we believe will become mineralized areas for future development through definition drilling. To achieve the required definition for drilling, we are implementing an underground platform to provide a more stable platform for completing the expansion drilling.
In terms of ore volumes for Q3 and Q4, we expect a significant ramp-up in gold sold from the South Pacific zone mineralization as we go to depth. The sulfide mineralization is expected to increase as well as we add more headings and make more mineralization available week by week and month by month.
As for the plans at Ruby, we are primarily focused on negotiating definitive document structure, tax structure, and balancing gold production with base metals. All commercial terms have been completed, and we are working towards finalizing the agreement. While we aim to complete the agreement soon, the timing may be subject to the back and forth of legal negotiations.
Regarding M&A opportunities, we acknowledge the interest in the industry for projects like ours. While we have diversified projects that attract attention, we believe in the value of our resources in a safe jurisdiction. While there may be interest in our projects, we are not currently considering M&A as we believe we offer significant value to our shareholders. Please feel free to contact our office and speak with Matt, Ryan, or myself for further discussion or any additional questions you may have. We are open to calls, but we are running out of time, so this will be our last question. Thank you to everyone who attended, and don’t hesitate to reach out to us if you need more information.
Operator: Thank you for participating in today’s conference. Please disconnect your lines.
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