Metals Update 03/06/2021

Abcourt Mines earns $367,416 in Q3

Abcourt Mines Inc. had excellent results for the third quarter and the nine-month period ended on March 31, 2021. All amounts are in Canadian dollars unless indicated differently.

Highlights:

  • The company reports a revenue of $4.8-million for the third quarter. This is 15 per cent lower than the $5.6-million reported for the same period in 2020. The lower revenue was due to the failure of the hoist motor at Elder on Dec. 22, 2020. Production was interrupted from that date to the end of January, 2021.
  • Despite this interruption, the company reports a net profit of $367,413 for the third quarter, compared with a loss of $97,604 for the same period in 2020. An adjusted net profit of $938,456 was realized in 2021, compared with $654,837 in 2020. The improvement is due to a lower cost of sales, which is explained by an improvement in the ore grade and a reduction in amortization, depletion and royalties.
  • The average price received for the sale of gold was $2,189 ($1,745 (U.S.)) per ounce in 2021. The company sold 2,199 ounces of golds in the third quarter, compared with 2,585 ounces in 2020, a reduction of 15 per cent. The company sold a fewer member of ounces because of the interruption of operations for one month.
  • Cash cost per ounce sold was $1,648 ($1,314 (U.S.)) and all-in sustaining costs were $2,002 ($1,596 (U.S.)) in 2021, compared with a cash cost of $1,844 ($1,366 (U.S.)) per ounce and an all-in sustaining costs of $2,129 ($1,577 (U.S.)) in 2020. This represents a decrease of 11 per cent for the cash cost and 6 per cent for the all-in sustaining costs compared with 2020. The reduction in cash costs and all-in sustaining costs is explained by lower mining costs and by an improvement of the ore grade at the Elder mine. For the third quarter, the grade was 4.49 grams per tonne (g/t) of gold, compared with 3.6 g/t of gold for the same period in 2020. The increase in grade was about 25 per cent. The lowering of the ounces sold, by about 15 per cent, reduced the impact of the better grade on the cash cost.
  • The cash provided by operating activities totalled $324,000, compared with a loss of $629,000 for third quarter of 2020. The company closed the quarter with $3.3-million in cash, compared with $1.9-million on June 30, 2020, which is an increase of $1.4-million. The increase in cash is due mainly to a first tranche of $1-million received from the Royal Bank of Canada loan.

The Elder mine continues to generate in important net profit and adjusted net profit.

Recent developments:

  • At the Elder mine, drifts were advanced on levels 4, 10 and 11 to open new ore zones. Rehabilitation work on level 12 was started.
  • At the Sleeping Giant mine, rehabilitation work is being done in old drifts. New drifts are advanced and definition drilling is done on levels 235 and 295 to open new ore zones on the upper levels of the mine.

Over the nine-month period, operations generated $5.2-million of cash, which was used to continue the development of Sleeping Giant and Elder mines.

Non-GAAP (generally accepted accounting principles) financial performance measures

This news release presents certain financial performance measures, total cash costs per ounce of gold produced, sustaining costs and all-in sustaining costs per ounce of gold produced, which are non-IFRS (international financial reporting standards) performances measures. These data may not be comparable with data presented by other gold producers. Non-GAAP financial performance measures should be considered together with other data prepared in accordance with IFRS.

About Abcourt Mines Inc.

Abcourt is a gold producer and a Canadian exploration company with strategically located properties in northwestern Quebec, Canada. The Elder property has gold resources. Abcourt is currently focusing on the exploitation of the Elder mine and on the development of the Sleeping Giant mine.

In 2016, Abcourt acquired the Sleeping Giant mine and mill, located halfway between Amos and Matagami in the Abitibi province of Quebec. The mill has a capacity to treat 700 to 750 tonnes per day. An estimate of the mineral resources, according to National Instrument 43-101, was prepared by Valere Larouche, consulting engineer in geology. It was filed on SEDAR on May 13, 2019.

Measured mineral resources total 10,900 tonnes with a grade of 12.20 g/t of gold and indicated resources total 475,625 tonnes with a grade of 11.20 g/t of gold. Inferred resources are 93,100 tonnes with a grade of 11.85 g/t of gold. An NI 43-101 feasibility study was completed in July, 2019, by PRB Mining Services Inc. Probable reserves according to NI 43-101 have been estimated at 339,221 tonnes with a grade of 7.9 g/t of gold.

The Abcourt-Barvue property has silver-zinc reserves. An NI 43-101 feasibility study was completed in 2007 by Roche/Genivar. An update was completed in July, 2019, by PRB Mining Services. A total of 8.07 million tonnes are in proven and probable reserves with a grade of 51.79 g/t of silver and 2.83 per cent zinc. About 81.6 per cent of these reserves are mineable by open pit and 18.4 per cent are mineable by underground operations. In addition, inferred resources total 2.07 million tonnes with a grade of 114.16 g/t of silver and 2.89 per cent zinc.

For the long term in gold, the corporation has prepared a $2-million exploration program, mainly for the Sleeping Giant mine, where important targets of gold mineralization have not yet been explored.

This news release was prepared by Renaud Hinse, engineer and president of Abcourt. Mr. Hinse is a qualified person under the terms of NI 43-101. Mr. Hinse has approved the content of the disclosure in this news release.

Mineral Mountain 5,330,600 warrants extended

The TSX Venture Exchange has consented to the extension in the expiry date of the following warrants.

Private placement

Number of warrants:  5,330,600

Original expiry date of warrants:  Dec. 5, 2020

New expiry date of warrants:  Dec. 5, 2021

Exercise price of warrants:  40 cents (unchanged)

These warrants were issued pursuant to a private placement of 5,330,600 shares, with 5,330,600 share purchase warrants attached, which was accepted for filing by the exchange effective Dec. 23, 2019.