Net earnings for New Gold (TSX: NGD) surged in 2016, reaching US$2.7 million from a loss of US$201.4 million in the 2015 period due to higher gold and silver prices and higher copper sales volumes. This was offset by operating troubles at the company’s Rainy River concession in Ontario, Canada.
Revenues dropped to US$683.8 million, down 4 percent from US$712.9 million in 2015.
“Our solid operating performance in 2016 enabled us to deliver record low all-in sustaining costs, resulting in strong margins and cash flow,” said Hannes Portmann, President and CEO. “Our three primary areas of focus in 2017 are enhancing our financial flexibility, executing our updated Rainy River plan and continuing to deliver operationally. Looking further ahead, we feel well positioned for the long-term with a robust gold reserve base of 15 million ounces.”
Gold and silver production both dropped in 2016, with 381,663 ounces of gold produced compared to 435,718 ounces in 2015. Silver reached 1.3 million ounces from 1.9 million ounces in 2015. But copper production increased to 102.3 million pounds from 100 million pounds for the comparable period last year.
New Gold’s Rainy River project has faced significant delays this year and the company now has to spend an additional US$195 to bring it into production. This has resulted in a drop in stock prices and the resignation of Randall Oliphant as the company’s Executive Chairman.
The full report can be found here.