TORONTO--(BUSINESS WIRE)--Nov. 13, 2006--Alamos Gold Inc. (TSX:
AGI) ("Alamos" or the "Company") announces that it has released its
unaudited interim financial results for the three-month and nine-month
periods ended September 30, 2006. Unaudited consolidated financial
statements are attached, and together with accompanying notes and
management's discussion and analysis for the three-month and
nine-month periods ended September 30, 2006 and 2005 will be available
under the Company's name at www.sedar.com.
All figures are unaudited and in United States dollars unless
otherwise stated. Refer to the Cautionary Non-GAAP Statements section
at the end of this release for a discussion of the non-GAAP measures
used by the Company.
Third Quarter 2006 Highlights:
During the three-month period ended September 30, 2006, the
Company:
-- Reported record gold production of 24,882 ounces
-- Sold 19,500 ounces of gold at an average realized price of
$624 per ounce for proceeds of $12.2 million. An additional
3,700 ounces of third quarter 2006 gold production were
available for sale at quarter-end
-- Reduced mining costs to record low levels of $1.13 per tonne
of material
-- Incurred cash operating costs of $287 per ounce of gold sold
as a result of a higher waste-to-ore ratio and lower grade
material being mined in the quarter
-- Realized a cash margin per ounce of gold sold of $305 per
ounce
-- Cash flow from operating activities before changes in non-cash
working capital (a non-GAAP measure) of $3,768,000 in the
quarter, and $13,909,000 for the nine-month period ended
September 30, 2006
-- Recognized earnings of $835,000 in the quarter and $1,120,000
for the nine-month period ended September 30, 2006
-- Achieved crusher throughput averaging 15,000 tonnes of ore per
day at 80% passing 1/2 inch crush size
Subsequent to quarter-end, the Company:
-- Attained record average daily gold production of 390 ounces
per day in the first 7 days of November
-- Commenced leaching of ore on expanded leach pad over an area
of 35,000 square meters
Results of Operations
The Mulatos mine (the "Mine") achieved commercial production April
1, 2006. The Company produces gold in dore bars for shipment to a
refinery.
Gold production at the Mine in the third quarter of 2006 was
24,882 ounces of gold in dore and gold sales were 19,500 ounces. On a
year-to-date basis, the Mine produced 69,454 ounces of gold and gold
sales were 65,950 ounces. All reported mine production is subject to
final refinery settlement.
The Mine achieved cost levels per tonne of ore consistent with the
Feasibility Study in the third quarter, taking into account a higher
waste-to-ore ratio in the quarter, as outlined in the attached table.
Mining costs were slightly above feasibility at $1.13 per tonne of
material. Management believes additional improvements in these unit
costs can be realized. Crusher throughput is achieving targeted Phase
II levels of 15,000 tonnes of ore per day.
The tables below outline key quarterly production and cost
indicators during 2006:
Q1 2006
Production summary (1) Q2 2006 Q3 2006 YTD 2006
----------------------------------------------------------------------
----------------------------------------------------------------------
Ounces produced (2) 20,949 23,623 24,882 69,454
----------------------------------------------------------------------
----------------------------------------------------------------------
Ore mined - tonnes 1,165,787 1,224,319 1,116,973 3,507,079
----------------------------------------------------------------------
Waste mined - tonnes 2,198,484 2,070,213 3,049,427 7,318,124
----------------------------------------------------------------------
Total tonnes mined 3,364,271 3,294,532 4,166,400 10,825,203
----------------------------------------------------------------------
----------------------------------------------------------------------
Tonnes of ore crushed 332,275 612,482 1,290,275 2,235,032
----------------------------------------------------------------------
----------------------------------------------------------------------
Tonnes of ore mined per
day 13,100 13,600 12,100 12,900
----------------------------------------------------------------------
Tonnes of ore crushed per
day (1) 6,400 6,800 14,000 9,800
----------------------------------------------------------------------
----------------------------------------------------------------------
Waste-to-ore ratio 1.89 1.69 2.73 2.09
----------------------------------------------------------------------
----------------------------------------------------------------------
Grade (g/t) 1.47 1.94 1.43 1.61
----------------------------------------------------------------------
Feasibility Q1 Q2 Q3
Costs per tonne summary Study (3) 2006 2006 2006
----------------------------------------------------------------------
Mining cost per tonne $0.95 $1.29 $1.33 $1.13
----------------------------------------------------------------------
----------------------------------------------------------------------
Waste-to-ore ratio 1.42 1.89 1.69 2.73
----------------------------------------------------------------------
----------------------------------------------------------------------
Mining cost per tonne of ore $2.44 $3.71 $3.64 $4.22
----------------------------------------------------------------------
Crushing cost per tonne of ore $1.15 $2.28 $1.99 $1.15
----------------------------------------------------------------------
Processing cost per tonne of ore $1.98 $1.45 $1.81 $1.67
----------------------------------------------------------------------
Administration cost per tonne of ore $0.97 $1.22 $1.26 $0.93
----------------------------------------------------------------------
----------------------------------------------------------------------
Cost per tonne of ore $6.54 $8.66 $8.70 $7.97
----------------------------------------------------------------------
(1) Tonnes of ore crushed per day for Q1 2006 reflects the results
of March 2006 only as the crushing and conveying system was
successfully commissioned in February 2006.
(2) Q1 2006 and Q2 2006 reported gold production has been adjusted
to reflect final settlement amounts. Q3 2006 reported gold production
is subject to final settlement.
(3) Average life of mine amounts as reported in the Feasibility
Study.
Cash operating cost per ounce of gold sold was $287 in the third
quarter of 2006 compared with $261 in the second quarter 2006 and $308
in the first quarter of 2006. On a year-to-date basis, cash operating
costs per ounce of gold sold was $285. In the third quarter, cash
operating costs were higher than feasibility due primarily to a higher
waste-to-ore ratio (2.73:1), lower mined head grade (1.43 g/t) and
expected lower recoveries from coarsely crushed ore stacked on the
leach pad.
Gold recovery rates are sensitive to crush size with finer crushed
material yielding higher recovery. The Company has assembled a
database of monthly composite column tests to analyze the recovery
rates of ore mined. Based on the results to date the Company's
expectations are that run-of-mine ore will recover approximately 50%
of gold content and coarsely crushed ore (approximately 80% passing 1
inch) will recover between 55% and 60%. The Company stacked
run-of-mine and coarse-crushed ore on the pad until July 1, 2006.
During the third quarter the Company was able to crush the ore to
a much finer size than achieved in previous periods. Crushed ore to
the pad averaged 80% passing 5/8 inch in the third quarter, which
compares with 80% passing 1 inch in the second quarter. In September
and October crusher throughput achieved 80% passing 1/2 inch. The
Company continues to reduce crush size in the expectation of achieving
the average life-of-mine feasibility recovery rate of 73%.
The Company realized an operating cash margin of $305 per ounce
compared with $326 per ounce in the second quarter, based on the
realized gold price. The cash margin calculated in the Feasibility
Study was $175 per ounce.
Mine operating costs allocated to ounces sold are summarized in
the table below for the periods indicated (change % is from Q2-2006 to
Q3-2006):
Q3 2006 Change Q2 2006 Q1 2006
----------------------------------------------------------------------
%
----------------------------------------------------------------------
Gold production - ounces (1) 24,882 +5.3 23,623 20,949
----------------------------------------------------------------------
Gold sales - ounces 19,500 -18.0 23,780 22,670
----------------------------------------------------------------------
----------------------------------------------------------------------
Cash operating costs (000)(2) $5,592 -9.7 $6,195 $6,975
----------------------------------------------------------------------
- Per ounce sold $287 +10.0 $261 $308
----------------------------------------------------------------------
----------------------------------------------------------------------
Royalties and production taxes
(000)(3) $623 -16.9 $750 -
----------------------------------------------------------------------
Total cash costs (000)(4) $6,215 -10.5 $6,945 $6,975
----------------------------------------------------------------------
- Per ounce sold $319 +9.2 $292 $308
----------------------------------------------------------------------
----------------------------------------------------------------------
Amortization (000) $1,664 -18.0 $2,030 $1,931
----------------------------------------------------------------------
Accretion of asset retirement
obligations (000) $40 +2.6 $39 $38
----------------------------------------------------------------------
Total production costs (000)(5) $7,919 -12.1 $9,014 $8,944
----------------------------------------------------------------------
- Per ounce sold $406 +7.1 $379 $394
----------------------------------------------------------------------
----------------------------------------------------------------------
- Realized gold price per ounce $624 +1.0 $618 $551
----------------------------------------------------------------------
- Realized cash margin per ounce (6) $305 -6.4 $326 $243
----------------------------------------------------------------------
(1) Q1 2006 and Q2 2006 reported gold production has been adjusted
to reflect final settlement amounts. Q3 2006 reported gold production
is subject to final settlement differences (if any).
(2) Cash operating costs is a non-GAAP measure which includes all
direct mining costs, refining and transportation costs and by-product
credits. Cash operating costs is equivalent to mining and processing
costs as reported in the Company's financial statements.
(3) Production royalties are included as of April 1, 2006 at 5% of
net precious metals revenues.
(4) Total cash costs is a non-GAAP measure which includes all cash
operating costs and royalties and production taxes. Total cash costs
is equivalent to mining and processing costs and royalties as reported
in the Company's financial statements.
(5) Total production costs is a non-GAAP measure which includes
all total cash costs, amortization, and accretion of asset retirement
obligations. Total production costs is equivalent to mining and
processing costs, royalties, amortization and accretion of asset
retirement obligations as reported in the Company's financial
statements.
(6) Realized cash margin per ounce is a non-GAAP measure which is
calculated as the difference between the Company's gold sales and
mining and processing and royalty expenses as reported in the
Company's financial statements.
Financial Results
A summary of the Company's financial results for the three and
nine-month periods ended September 30, 2006 and 2005 is presented
below:
Q3 2006 YTD 2006 Q3 2005 YTD 2005
----------------------------------------------------------------------
----------------------------------------------------------------------
Cash provided by (used
for) operating
activities before
changes in non-cash
working capital (000)
(1) $3,768 $13,909 ($1,459) ($3,304)
----------------------------------------------------------------------
Changes in non-cash
working capital (000) ($6,624) ($15,211) ($2,883) ($2,882)
----------------------------------------------------------------------
Cash used for
operating activities
(000) ($2,856) ($1,302) ($4,342) ($6,186)
----------------------------------------------------------------------
----------------------------------------------------------------------
Earnings (loss) for
the period (000) $835 $1,120 ($2,448) ($6,302)
----------------------------------------------------------------------
Earnings (loss) per
share (2) $0.01 ($0.06) ($0.03) ($0.08)
----------------------------------------------------------------------
Weighted average
number of common
shares outstanding
- Basic 93,403,000 85,583,000 77,275,000 77,148,000
----------------------------------------------------------------------
(1) A non-GAAP measure.
(2) Earnings (loss) per share YTD 2006 includes the debt
settlement expense related to the early conversion of convertible
debentures that was charged to retained earnings of $5,990,000 or
$0.07 per share.
The Company reported revenue of $12.2 million based on sales of
19,500 ounces of gold. There was an additional 3,700 ounces of gold in
dore available for sale after the end of the third quarter. The
Company generated cash from operating activities (before changes in
non-cash working capital) of $3,768,000 in the third quarter of 2006,
and $13,909,000 on a year-to-date basis. Net of working capital
changes the Company used $2,856,000 in operations in the third quarter
and $1,302,000 year-to-date, mainly as a result of increasing spare
parts and supplies at the Mine and to mine and partially process
gold-bearing ore. The Company had earnings of $835,000 or $0.01 per
share in the third quarter and $1,120,000 year-to-date. A loss per
share of $0.06 was incurred on a year-to-date basis reflecting a loss
on conversion of convertible debentures in June 2006. The third
quarter of 2006 benefited significantly as a result of the early
conversion of debentures, by eliminating interest, accretion and
foreign exchange costs associated with the debentures. Results for the
three and nine-month periods ended September 30, 2005 are not
comparable as they do not reflect commercial mining activities.
Exploration and Mine Development Activities
During 2006, the Company's exploration activities have focused
primarily on resource definition projects. During the nine-month
period ended September 30, 2006, the Company invested $6.8 million in
exploration and development activities of which $2.9 million was
incurred in the third quarter. Exploration activities during the year
were primarily focused on development drilling in the Escondida,
Escondida Hanging Wall Zone (EHWZ), and El Victor areas, and near-mine
exploration drilling at San Carlos and Puerto del Aire. A breakdown of
the exploration expenditures by project is presented in the table
below:
Project name Q3 2006 YTD 2006
($000) ($000)
----------------------------------------------------------------------
Escondida 1,320 3,190
----------------------------------------------------------------------
El Victor 648 1,521
----------------------------------------------------------------------
San Carlos 532 532
----------------------------------------------------------------------
El Realito 56 309
----------------------------------------------------------------------
Puerto del Aire 125 212
----------------------------------------------------------------------
Bajios 2 188
----------------------------------------------------------------------
Other 240 861
----------------------------------------------------------------------
2,923 6,813
----------------------------------------------------------------------
In August 2006, the Company released results of a Phase I drilling
program completed in the San Carlos area, located at the extreme
northeast end of the Escondida area. The area was selected as a
high-priority exploration target based on geologic similarities to the
high-grade EHWZ. The drilling program delineated an extensive area of
blind mineralization extending a minimum of 600 meters to the
northeast from the El Victor project area.
A development drift connecting the Escondida and El Victor zones
was initiated in 2005 to complete development drilling from
underground along a two-kilometer mineralized structural corridor.
Drill stations were established at 50 to 100 meter intervals
throughout the length of underground development. Drilling was
completed in the Escondida deposit in June, with a total of 128
underground core holes (10,276 meters) drilled. All Escondida drill
holes have been logged, photographed, sampled and sent for assay. Two
underground core rigs were moved from Escondida to El Victor in the
second quarter. A total of 96 drill holes (6,950 meters) have been
drilled to date at El Victor.
In addition, 26 reverse circulation ("RC") drill holes (4,191
meters) have been drilled in the El Victor to Gap area. Drilling is
expected to continue and results to date have been favorable, with
mineralization continuity indicated between El Victor and Gap. Initial
Gap zone intercepts include 38.11m of 2.86 g/t Au in 06EV024 and
54.88m of 1.94 g/t Au in 06EV029. Additional surface and underground
drilling will be required to interpret zone geometry and extent.
An update on the EHWZ was issued on March 15, 2006, announcing
additional high-grade gold intervals from recently completed drilling
designed to further define the zone. High-grade intercepts have been
encountered in an area approximately 165 meters long by 75 meters
wide. Surface drilling is complete with 64 reverse circulation holes
(6,431 meters) and seven large-diameter core holes (194 meters).
Twenty-three additional RC holes (1,784 meters) were drilled into the
EHWZ during August and September to infill gaps in the preliminary
block model and to allow for core-RC comparison in areas of
predominantly underground core data. Additional intercepts of coarse
visible gold were encountered. Assay and logging data for all of the
EHWZ surface drill holes and underground drill holes are complete and
resource modeling using the new data is in progress.
A bulk sampling drift into the EHWZ commenced in the third
quarter. To date, 255 meters of development has been completed with an
estimated total of 8,000 tonnes of high-grade material removed and
stockpiled. Abundant visible gold is present throughout the
development workings, often in pockets of coarse nuggety gold. Gold
particle size is much greater than expected, frequently greater than
one millimeter, and occasionally to greater than 20 millimeters.
Gold mode of occurrence and sampling data to date suggest that
large bulk samples will be needed to accurately estimate grade. All
rounds have been carefully handled to avoid contamination and
individually stockpiled for bulk sampling. Large 12 kilogram grab
samples taken from the first 67 bulk 40-60 tonne rounds within the
high-grade zone average 25.29 g/t Au.
A recognized expert in coarse gold sampling will be on site in
mid-November to recommend sampling protocol for accurately estimating
content of the coarsest gold.
The exploration programs are being carried out under the direction
of Ken Balleweg, P. Geol, BSc. Geological Engineering, M.S. Geology,
Alamos' Vice President of Exploration and the Qualified Person as
defined by National Instrument 43-101 of the Canadian Securities
Administrators. Sampling method for bulk grab samples of mined
material was to excavate a shallow trench at four locations in each
stockpiled individual round and sample the run of mine
material. Several rounds were also continuously grab sampled while
being mucked. Drilling method was reverse circulation using a center
return bit and 1.5 meter sample intervals. Strict sampling and QA/QC
protocol are followed, including the insertion of standards and blanks
on a regular basis. Samples were sent to ALS Chemex Inc. in
Hermosillo, Mexico for sample preparation and then to Vancouver,
British Columbia for analysis. Analytical method for the bulk samples
was screen fire assay. Analytical method for drill samples is fire
assay with atomic adsorption finish and gravimetric finish for
individual samples with a gold concentration greater than 3.0 g/t. A
0.5 g/t cut-off grade was used for calculation of composite intervals,
with only a single 1.5m interval of sub-0.5 g/t material allowed
within a composite interval.
Resource estimates for both the EHWZ and the Escondida main
deposit are expected to be completed in late 2006.
Liquidity and Capital Resources
At September 30, 2006 the Company had cash and cash equivalents of
$9.4 million (December 31, 2005: $4.5 million) and working capital of
$32.5 million (December 31, 2005: $13.0 million).
As at September 30, 2006, the Company had an unsecured $10 million
revolving line of credit with a bank, available for general corporate
purposes. At the end of the third quarter, $3 million had been drawn
on this facility.
Outlook
The Company achieved several milestones in the third quarter in
reporting record quarterly gold production, and reaching its targeted
rate of 15,000 tonnes of crushed ore per day in September.
Considerable progress was also made in reducing costs per tonne of ore
to levels consistent with the Feasibility Study. The Company expects
to sustain the cost savings that were realized in the third quarter.
In the third quarter, the Company was able to crush ore to a much
finer size than achieved in previous periods. Objectives for the
fourth quarter of 2006 include reducing crush size to Feasibility
Study specifications to improve gold recoveries and to achieve record
gold production and sales.
Alamos' common shares are traded on the Toronto Stock Exchange
under the symbol "AGI" and convertible debentures under the symbol
AGI.DB".
The company anticipates that its yearly production will be in line
with its previous guidance.
Conference Call:
Alamos' senior management will host a conference call on Tuesday,
November 14th, at 11:00 a.m. EDT (8:00 am PDT) to discuss its
financial results and exploration and operations activities.
Live Conference Call:
Please dial 416-644-3418 or 1-800-814-4862 to access this call
between 11:00 AM ET and 12:00 PM ET on Tuesday, November 14th, 2006.
Instant Replay Access information:
For those unable to participate in the conference call at the
scheduled time, a replay of the conference call will be available
beginning on November 14th at 1:00 PM ET until Tuesday, November 21st
at 11:59 PM ET.
Replay Access No.: 416-640-1917
Passcode: 21206477 followed by the number sign.
Replay Access No.: 877-289-8525
Passcode: 21206477 followed by the number sign.
Webcast:
The conference call will also be webcast live at
www.alamosgold.com
Cautionary Non-GAAP Statements
The Company believes that investors use certain indicators to
assess gold mining companies. They are intended to provide additional
information and should not be considered in isolation or as a
substitute for measures of performance prepared with GAAP. "Cash flow
from operating activities before changes in non-cash working capital"
is a non-GAAP performance measurement which could provide an
indication of the Company's ability to generate cash flows from
operations, and is calculated by adding back the change in non-cash
working capital to "Cash provided by (used for) operating activities"
as presented on the Company's consolidated statements of cash flows.
"Mining cost per tonne of ore" is a non-GAAP performance measurement
which could provide an indication of the mining and processing
efficiency and effectiveness at the Mine. It is determined by dividing
the relevant mining and processing costs by the tonnes of ore
processed in the period. "Cost per tonne of ore" is usually affected
by operating efficiencies and waste-to-ore ratios in the period. "Cash
operating cost per ounce" and "total cash cost per ounce" as used in
this analysis are non-GAAP terms typically used by gold mining
companies to assess the level of gross margin available to the Company
by subtracting these costs from the unit price realized during the
period. These non-GAAP terms are also used to assess the ability of a
mining company to generate cash flow from operations. There may be
some variation in the method of computation of "cash operating cost
per ounce" as determined by the Company compared with other mining
companies. In this context, "cash operating cost per ounce" reflects
the cash operating cost allocated from in-process and dore inventory
associated with ounces of gold sold in the period. "Cash operating
cost per ounce" may vary from one period to another due to operating
efficiencies, waste-to-ore ratios, grade of ore processed and gold
recovery rate in the period. "Total cash cost per ounce" includes
"cash operating cost per ounce" plus applicable cash royalties.
The TSX has not reviewed and does not accept responsibility for
the adequacy or accuracy of this release.
Safe Harbor Statement under the United States Private Securities
Litigation Act of 1995. Except for the statements of historical fact
contained herein, the information presented constitutes
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements,
include, but are not limited to those with respect to, the price of
gold, the estimation of mineral reserves and resources, the
realization of mineral reserves estimates, the timing and amount of
estimated future production, costs of production, capital
expenditures, costs and timing of the development of new deposits,
success of exploration activities, Alamos' hedging practices,
permitting time lines, currency fluctuations, requirements for
additional capital, government regulation of mining operations,
environmental risks, unanticipated reclamation expenses, title
disputes or claims limitations on insurance coverage and the timing
and possible outcome of pending litigation. Often, but not always,
forward-looking statements can be identified by the use of words such
as "plans", "expects", or "does not expect", "is expected", "budget",
"estimates", "forecasts", "intends", "anticipates" or "does not
anticipate", or "believes", or variation of such words and phrases or
statements that certain actions, events or results, "may", "could",
"would" "might" or "will" be taken, occur or be achieved.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of Alamos to be materially different from
any future results, performance or achievements expressed or implied
by such forward-looking statements. Such factors include, among
others, the actual results of current exploration activities, actual
results of current reclamation activities, conclusions of economic
evaluations, changes in project parameters as plans continue to be
refined, future prices of gold, possible variations in ore grade or
recovery rates, failure of plant, equipment or processes to operate as
anticipated, accidents, labour disputes and other risks of the mining
industry, delays in obtaining governmental approvals or financing or
in the completion of development or construction activities, as well
as those factors discussed under the section entitled "Risk Factors"
of the Company's Annual Information Form. Although Alamos has
attempted to identify important factors that could cause actual
actions, events or results to differ materially from those described
in forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate as actual results and future events could
differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on
forward-looking statements contained herein.
ALAMOS GOLD INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited - stated in thousands of United States dollars)
September 30, December 31,
2006 2005
------------- ------------
A S S E T S
Current Assets
Cash and cash equivalents $9,419 $4,519
Restricted cash 81 1,219
Fair value of forward contracts - 966
Amounts receivable 5,235 3,862
Advances and prepaid expenses 1,362 1,935
Inventory 25,404 9,989
------------- ------------
41,501 22,490
Deferred financing charges - 1,183
Long-term investment 1,100 -
Mineral property held for sale - 1,013
Mineral property, plant and equipment 111,091 101,514
------------- ------------
$153,692 $126,200
------------- ------------
L I A B I L I T I E S
Current Liabilities
Accounts payable and accrued liabilities $4,474 $5,323
Bank loan 3,000 3,000
Current portion of capital lease
obligations 1,500 1,190
------------- ------------
8,974 9,513
Future income taxes 840 -
Capital lease obligations 7,004 3,616
Convertible debenture 1,126 33,326
Asset retirement obligations 2,235 2,100
S H A R E H O L D E R S' E Q U I T Y
Share capital 158,493 87,830
Warrants - 265
Convertible debenture 297 9,983
Contributed surplus 3,196 3,170
Deficit (28,473) (23,603)
------------- ------------
133,513 77,645
------------- ------------
$153,692 $126,200
------------- ------------
ALAMOS GOLD INC.
CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) AND DEFICIT
(Unaudited - stated in thousands of United States dollars, except per
share amounts)
For the three-month For the nine-month
periods ended periods ended
September 30 September 30
----------------------- -----------------------
2006 2005 2006 2005
OPERATING REVENUES
Gold sales $12,165 $441 $39,355 $441
----------- ----------- ----------- -----------
OPERATING EXPENSES
Mining and processing 5,592 300 18,763 300
Royalties 623 - 1,373 -
Amortization 1,664 84 5,625 201
Exploration 1,500 495 3,374 884
Corporate and
administrative 722 531 2,827 2,214
Stock-based
compensation 390 - 1,170 927
Accretion of asset
retirement
obligations 40 4 117 9
----------- ----------- ----------- -----------
10,531 1,414 33,249 4,535
----------- ----------- ----------- -----------
EARNINGS (LOSS) FROM
OPERATIONS 1,634 (973) 6,106 (4,094)
Interest income 103 218 291 823
Interest expense (278) (588) (1,867) (1,205)
Financing charges (74) (114) (375) (202)
Accretion of
convertible debenture
discount (15) (413) (945) (866)
Foreign exchange gain
(loss) 166 (578) (843) (758)
Other loss (21) - (407) -
----------- ----------- ----------- -----------
Earnings (loss) before
income tax for the
period 1,515 (2,448) 1,960 (6,302)
Future income taxes (680) - (840) -
----------- ----------- ----------- -----------
Earnings (loss) for
the period 835 (2,448) 1,120 (6,302)
Deficit, beginning of
period (29,308) (18,010) (23,603) (14,156)
Conversion of
convertible
debentures - - (5,990) -
----------- ----------- ----------- -----------
Deficit, end of period $(28,473) $(20,458) $(28,473) $(20,458)
----------- ----------- ----------- -----------
Earnings (loss) per
share - basic and
diluted $0.01 $(0.03) ($0.06) $(0.08)
----------- ----------- ----------- -----------
Weighted average
number of common
shares outstanding
- basic 93,403,000 77,275,000 85,583,000 77,148,000
- diluted 96,483,000 77,275,000 85,583,000 77,148,000
ALAMOS GOLD INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited - stated in thousands of United States dollars)
For the three- For the nine-
month periods month periods
ended September ended September
30 30
---------------- -----------------
Cash provided by (used for): 2006 2005 2006 2005
Operating Activities
Earnings (loss) for the period $835 $(2,448) $1,120 $(6,302)
Adjustments for items not involving
cash:
Amortization 1,664 84 5,625 201
Accretion of asset retirement
obligations 40 4 117 9
Foreign exchange loss (gain) on
convertible debenture 85 1,578 1,578 1,984
Fair value of forward contracts 59 (1,204) 966 (1,204)
Interest expense settled with
common shares - - 833 -
Future income taxes 680 - 840 -
Accretion of convertible debenture
discount 15 413 945 866
Loss on settlement of convertible
debenture - - 414 -
Amortization of deferred financing
charges - 114 301 215
Stock-based compensation 390 - 1,170 927
Changes in non-cash working
capital:
Amounts receivable (581) 361 (1,373) 31
Inventory (6,508) (2,320) (12,028) (2,866)
Prepaid expenses (885) (88) (961) (65)
Accounts payable and accrued
liabilities 1,350 (836) (849) 18
------- -------- -------- --------
(2,856) (4,342) (1,302) (6,186)
------- -------- -------- --------
Investing Activities
Short-term investments - - - 15,000
Deposits and advances to
contractors 2,667 (158) 1,533 (2,557)
Mineral property, plant and
equipment (5,590) (16,054) (18,657) (41,520)
------- -------- -------- --------
(2,923) (16,212) (17,124) (29,077)
------- -------- -------- --------
Financing Activities
Convertible debenture issued - - - 40,306
Common shares issued 725 248 18,490 1,341
Capital lease advances 1,427 - 4,450 -
Capital lease repayments (437) - (752) -
Restricted cash (6) 1,263 1,138 (1,092)
Deferred financing charges - 26 - (1,690)
------- -------- -------- --------
1,709 1,537 23,326 38,865
Net (decrease) increase in cash and
cash equivalents (4,070) (19,017) 4,900 3,602
Cash and cash equivalents -
beginning of period 13,489 35,746 4,519 13,127
------- -------- -------- --------
Cash and cash equivalents - end of
period $9,419 $16,729 $9,419 $16,729
------- -------- -------- --------
Supplemental information:
Interest paid $252 $1,231 $1,787 $1,231
------- -------- -------- --------
CONTACT: Alamos Gold Inc.
John A. McCluskey, 416-368-9932 Ext. 203
President and Chief Executive Officer
or
Victoria Vargas, 416-368-9932 Ext. 201
Investor Relations
vvargas@alamosgold.com
www.alamosgold.com
SOURCE: Alamos Gold Inc.
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