New Gold Inc. (USA)(NYSEMKT:NGD) released its 3Q2016 report and updated on the construction of its Rainy River project. Gold production came in at 95,546 ounces while copper production amounted to 25.5 million pounds. All-in sustaining costs declined to $682 per ounce, covering total cash costs of $350 per ounce. Cash from operations before any changes in non-cash working capital was $89 million, a jump of 53% compared to 2015. The company reported highest quarterly cash flow since 4Q2013.
Adjusted net earnings came at $13 million in 3Q2016 compared to $9 million in adjusted net loss, recorded in 2015. Net earnings was $5 million against a net loss of $158 million in 2015. Rainy River construction is currently almost 60% complete. Cash and equivalents at the close of September 2016 came at $151 million.
The management speaks
Randall Oliphant, the Executive Chairman of New Gold, said that their businesses will continue to achieve very strong results. With the surge in the prices of gold and the quarterly ASIC of $682 per ounce, the company succeeded in selling each ounce of gold for nearly twice what it cost company to produce it. They are on track to fulfill full-year gold production estimate and are delighted to be in a position to achieve robust margins. Additionally, Rainy River project is 60% complete and advancing well.
As part of company’s second quarter report release, New Gold reduced its FY2016 guidance for all-in sustaining costs and total cash costs by $75 per ounce. Depending on New Gold’s so far released operating performance, and assuming current foreign exchange rates and commodity prices, the firm anticipates its FY2016 all-in sustaining costs and total cash costs to come near the midpoint of the revised ranges of $750 – $790 per ounce and $360-$400 per ounce, respectively.
David Schummer, the COO and Executive VP of New Gold, said that they are extremely proud of 2016 operational performance. The team’s focus on implementing business improvement prospects has resulted in strong performance, particularly at the Peak Mines and New Afton.