Alamos Gold Reports Record Fourth Quarter 2022 Production and Provides Three-Year Production and Operating Guidance Strong outlook with multi-year production guidance increased, capital guidance maintained, and all-in sustaining costs expected to decrease 18% over the next three
ALAMOS GOLD INC.
Brookfield Place, 181 Bay Street, Suite 3910, P.O. Box #823
Toronto, Ontario, Canada M5J 2T3
Telephone: (416) 368-9932 or 1 (866) 788-8801
All amounts are in United States dollars, unless otherwise stated.
F O R I M M E D I A T E R E L E A S E
W E B S I T E : w w w . a l a m o s g o l d . c o m T R A D I N G S Y M B O L : T S X : A G I N Y S E : A G I
Alamos Gold Reports Record Fourth Quarter 2022 Production and Provides
Three-Year Production and Operating Guidance
Strong outlook with multi-year production guidance increased, capital guidance
maintained, and all-in sustaining costs expected to decrease 18% over the next three
years driving strong margin expansion
Toronto, Ontario (January 12, 2023) – Alamos Gold Inc. (TSX:AGI; NYSE:AGI) (“Alamos” or
the “Company”) today reported fourth quarter and annual 2022 production. The Company also
provided updated three-year production and operating guidance.
“With our strongest performance of the year coming in the fourth quarter, including record
production, we met full year 2022 production guidance. We also expect to meet cost guidance
with a significant decrease in costs in the second half of the year driven by the ramp up of low-
cost production from La Yaqui Grande. We expect this trend to continue over the next several
years with a 9% increase in production and 5% decrease in all-in sustaining costs in 2023
driven by a full year of production from La Yaqui Grande, and strong ongoing performances at
our Canadian operations,” said John A. McCluskey, President and Chief Executive Officer.
“As outlined in our updated three-year guidance, our strong outlook remains intact. We have
increased our production guidance for 2023 and 2024, reflecting a stronger outlook at both
Mulatos and Island Gold, and we remain on track to deliver a substantial decrease in costs
over the next three years. With higher production and lower costs, we expect to generate
growing free cash flow while funding the Phase 3+ Expansion at Island Gold. Once completed
in 2026, we expect this to drive a significant increase in production, a further reduction in costs
and substantial free cash flow growth,” Mr. McCluskey added.
2023 – 2025 Guidance Summary: Operating Mines
2023 2024 2025
Current Previous Current Previous Current
Total Gold Production (000 oz) 480 - 520 460 - 500 470 - 510 460 - 500 470 - 510
Total Cash Costs(1) ($/oz) $825 - $875 $775 - $875 $675 - $775 $650 - $750 $650 - $750
All-in Sustaining Costs(1),(2) ($/oz) $1,125 - $1,175 $1,075 - $1,175 $975 - $1,075 $950 - $1,050 $950 - $1,050
Total sustaining & growth capital(1),(3)
(Operating mines; ex. exploration)
($ millions)
$280 - 320 $280 - 320 $290 - 330 $290 - 330 $290 - 330
(1) Refer to the “Non-GAAP Measures and Additional GAAP” disclosure at the end of this press release for a description of these measures.
(2) All-in sustaining cost guidance for 2024 and 2025 includes the same assumptions for G&A and stock based compensation as in cluded in 2023.
(3) Sustaining and growth capital guidance is for producing mines and excludes capital for Lynn Lake , other development projects, and capitalized
exploration. Growth capital and total capital were revised higher by $60m in each of 2023 and 2024 with the release of the Island Gold Phase 3+
Expansion Study on June 28, 2022.
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Fourth Quarter and Full Year 2022 Operating Highlights
• Record quarterly production: of 134,200 ounces of gold, a 9% increase from the
third quarter. This was driven by solid performances from all three operations,
including a substantial increase at Mulatos with the ramp up of La Yaqui Grande
• Met 2022 annual production guidance: with the strong fourth quarter performance,
production of 460,400 ounces was in line with annual guidance and consistent with
2021
• Costs expected to meet 2022 guidance: total cash costs and all-in sustaining costs
(“AISC”) for 2022 have not been finalized but are expected to decrease in the fourth
quarter to the lowest levels of the year. Full year costs are expected to be in line with
guidance for total cash costs of between $875 and $925 per ounce and AISC of
between $1,190 and $1,240 per ounce, a solid performance given industry-wide
inflationary pressures
• Record revenues: sold 133,164 ounces of gold in the fourth quarter at an average
realized price of $1,741 per ounce for record revenues of $232 million. Full year sales
totaled 456,574 ounces of gold at an average realized price of $1,799 per ounce for
revenues of $821 million
• Stronger cash position: ended the year with approximately $130 million of cash and
cash equivalents, up from $117 million as of September 30, 2022. The Company
remains debt-free
Fourth Quarter and Full Year 2022 Operating Results
Q4 2022 Q4 2021 2022 2021 2022 Guidance
Gold production (ounces)
Young-Davidson 44,500 51,900 192,200 195,000 185,000 – 200,000
Island Gold 40,600 37,500 133,700 140,900 125,000 – 135,000
Mulatos District 49,100 23,100 134,500 121,300 130,000 – 145,000
Total gold production 134,200 112,500 460,400 457,200 440,000 – 480,000
Three Year Guidance Overview1 – Operating Mines
• Multi-year production guidance increased with 9% growth expected in 2023:
production is expected to increase to between 480,000 and 520,000 ounces in 2023
and remain at similar levels in 2024 and 2025. Production guidance was increased for
2023 and 2024 with stronger production expected from Island Gold and Mulatos
• Additional upside potential in 2025 with further growth expected in 2026: newly
issued 2025 guidance excludes the higher-grade Puerto Del Aire (“PDA”) project which
represents potential production upside at Mulatos. This upside is expected to be
outlined in a new development plan for PDA to be completed in the second half of
2023. A further increase in production is expected in 2026 with the completion of the
Phase 3+ Expansion at Island Gold
• Total cash costs expected to decrease 6% in 2023 to between $825 and $875 per
ounce, and 22% by 2025 to $650 to $750 per ounce: costs are expected to
decrease substantially over the next three years driven by low-cost production growth
from La Yaqui Grande and Island Gold. A further improvement in costs is expected in
2026 following the completion of the Phase 3+ Expansion. Cost guidance for 2023 and
2024 increased a modest 3% on average over previous guidance reflecting industry-
wide cost pressures
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• All-in sustaining costs expected to decrease 5% to $1,125 to $1,175 per ounce in
2023, and 18% by 2025 to $950 to $1,050 per ounce: consistent with total cash
costs, AISC are expected to decrease significantly over the next three years with a
further improvement expected in 2026 following the completion of the Phase 3+
Expansion at Island Gold
• Total capital guidance maintained and stable over the next three years: total
capital (excluding capitalized exploration) is expected to range between $292 to $332
million in 2023, consistent with 2022 guidance. This includes $280 to $320 million of
capital at producing mines, with a similar rate expected in 2024, both unchanged from
previous guidance. Capital spending for producing mines is expected to remain at
similar levels in 2025 and decrease significantly in 2026 following the completion of the
Phase 3+ Expansion. The total capital budget for 2023 includes:
o Sustaining capital guidance of $105 to $115 million: up approximately 13%
from 2022, primarily reflecting higher sustaining capital at Island Gold.
Sustaining capital is expected to remain at similar levels through 2025
o Growth capital guidance for producing mines of $175 to $205 million:
down 11% from 2022 with the increase in growth capital at Island Gold more
than offset by the decrease at Mulatos with the completion of construction at La
Yaqui Grande in 2022
• Exploration budget of $47 million: similar to expected 2022 spending with the
majority allocated towards following up on ongoing exploration success at Island Gold
and the Mulatos District, including at the higher-grade underground PDA deposit
• Fully funded growth with strong free cash flow: higher production and declining
costs are expected to drive strong free cash flow over the next three years while
continuing to fund the Phase 3+ Expansion at Island Gold. A further increase in free
cash flow is expected in 2026 with the completion of the Phase 3+ Expansion
• Strong ongoing returns to shareholders: through the existing $0.10 per share
annualized dividend (paid quarterly) and share repurchases under the Normal Course
Issuer Bid. In 2022, the Company returned $48 million to shareholders between
dividends and share repurchases, consistent with 2021
1 Guidance statements in this release are forward-looking information. See the Assumptions and Sensitives section of this release along with the
cautionary note at the end of this release.
Upcoming 2023 catalysts
• 2022 year-end Mineral Reserve and Resource update: February 2023
• Island Gold and Mulatos exploration updates: ongoing
• Lynn Lake Environmental Impact Statement Approval and updated Feasibility
Study: H1 2023
• PDA development plan: H2 2023
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2023 Guidance
2023 Guidance 2022 Guidance
Young-Davidson Island Gold Mulatos District Lynn Lake Total Total
Gold production (000 oz) 185 - 200 120 - 135 175 - 185 480 - 520 460 (actual)
Cost of sales, including
amortization ($ millions)(2) $625 $610
Cost of sales, including
amortization ($/oz)(2) $1,250 $1,325
Total cash costs ($/oz)(1) $900 - 950 $600 - 650 $900 - 950 - $825 - 875 $875 - 925
All-in sustaining costs ($/oz)(1) $1,125 - 1,175 $1,190 - 1,240
Mine-site all-in sustaining costs
($/oz)(1)(3) $1,175 - 1,225 $950 - 1,000 $950 - 1,000 -
Capital expenditures ($ millions)
Sustaining capital(1) $50 - 55 $45 - 50 $10 - $105 - 115 $90 - 105
Growth capital(1) $5 - 10 $165 - 185 $5 - 10 $12 $187- 217 $215 - 240
Total Sustaining and Growth
Capital(1) ($ millions) $55 - 65 $210 - 235 $15 - 20 $12 $292 - 332 $305 - 345
Capitalized exploration(1) ($ millions) $5 $11 $4 $5 $25 $27
Total capital expenditures and
capitalized exploration(1) ($ millions) $60 - 70 $221 - 246 $19 - 24 $17 $317 - 357 $332 - 372
(1) Refer to the "Non-GAAP Measures and Additional GAAP" disclosure at the end of this press release for a description of these measures.
(2) Cost of sales includes mining and processing costs, royalties, and amortization expense, and is calculated based on the mid -point of total cash
cost guidance.
(3) For the purposes of calculating mine -site all-in sustaining costs at individual mine sites, the Company does not include an allocation of corporate
and administrative and share based compensation expenses to the mine sites.
Gold production in 2023 is expected to increase approximately 9% over 2022 (based on the
mid-point of guidance) driven by higher production from the Mulatos District, with La Yaqui
Grande contributing a full year of production. Production guidance for 2023 has increased 4%
from previous three-year guidance provided in January 2022 reflecting stronger outlooks for
both Mulatos and Island Gold. Production is expected to be relatively balanced between the
first and second half of the 2023.
Total cash costs and AISC are expected to decrease 6% and 5%, respectively, from 2022
(based on the mid-point of guidance) reflecting a full year of low-cost production from La
Yaqui Grande. Costs are expected to decrease through the year, primarily driven by
increasing grades and declining costs at Young-Davidson.
Capital spending is expected to decrease slightly from 2022 and is consistent with previous
three-year guidance for 2023. Approximately 55% of full year capital is expected to be spent
during the first half of the year. Capital spending and costs are expected to decline in the
second half of the year, which is anticipated to drive stronger free cash flow.
Despite significant industry-wide inflationary pressures, the Company has maintained 2023
capital guidance and the upper end of the range of its total cash cost and AISC guidance.
Furthermore, the Company remains on track to deliver a substantial decrease in costs over
the next three years highlighting the strength and quality of its asset base.
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2023 – 2025 Guidance: Operating Mines
2023 2024 2025
Current Previous Current Previous Current
Gold Production (000 oz)
Young-Davidson 185 - 200 185 - 200 185 - 200 185 - 200 185 - 200
Island Gold 120 - 135 115 - 125 145 - 160 140 - 155 175 - 190
Mulatos District 175 - 185 160 - 175 140 - 150 135 - 145 110 - 120
Total Gold Production (000 oz) 480 - 520 460 - 500 470 - 510 460 - 500 470 - 510
Total Cash Costs(1) ($/oz) $825 - $875 $775 - $875 $675 - $775 $650 - $750 $650 - $750
All-in Sustaining Costs(1),(2) ($/oz) $1,125 - $1,175 $1,075 - $1,175 $975 - $1,075 $950 - $1,050 $950 - $1,050
Sustaining capital(1),(3) ($ millions) $105 - 115 $95 - 110 $105 - 115 $95 - 110 $105 - 115
Growth capital(1),(3),(4) ($ millions) $175 - 205 $185 - 210 $185 - 215 $195 - 220 $185 - 215
Total sustaining & growth capital(1),(3)
(Operating mines; ex. exploration)
($ millions)
$280 - 320 $280 - 320 $290 - 330 $290 - 330 $290 - 330
(1) Refer to the “Non-GAAP Measures and Additional GAAP” disclosure at the end of this press release for a description of these measures.
(2) All-in sustaining cost guidance for 2024 and 2025 includes the same assumptions for G&A and stock based compensation as included in 2023.
(3) Sustaining and growth capital guidance is for producing mines and excludes capital for Lynn Lake and other development projects, and
capitalized exploration.
(4) Growth capital was revised higher by $60m in each of 2023 and 2024 to reflect the Island Gold Phase 3+ Expansion Study released on June 29,
2022.
Gold production is expected to remain at similar levels in 2024 and 2025, with increasing
production from Island Gold offsetting a decrease in production at Mulatos. Consistent with
2023, production guidance for 2024 was increased reflecting stronger outlooks for both Island
Gold and Mulatos. Production guidance for 2025 excludes any production from the higher-
grade PDA project which represents potential upside within the Mulatos District. This potential
upside is expected to be outlined in a new development plan for the project to be completed in
the second half of 2023. The completion of the Phase 3+ Expansion at Island Gold is
expected to drive a further increase in production in 2026, with additional growth potential
from Lynn Lake beyond that.
Total cash costs and AISC are expected to improve significantly in 2024, decreasing 15% and
11%, respectively, from 2023. This reflects a further decrease in costs from the Mulatos
District, with La Yaqui Grande providing the majority of production, as well as lower costs at
Island Gold, reflecting the mining and processing of higher grades. A growing contribution of
low-cost production from Island Gold is expected to drive a further decrease in costs in 2025
such that total cash costs and AISC are expected to decrease 22% and 18%, respectively,
from 2022. Costs are expected to decrease further in 2026 following the completion of the
Phase 3+ Expansion at Island Gold.
Capital spending at existing operations (excluding Lynn Lake) is expected to decrease slightly
in 2023, primarily driven by lower capital at Mulatos with the completion of construction of La
Yaqui Grande in 2022, offset in-part by a higher rate of capital spending on the Phase 3+
Expansion at Island Gold. Capital spending at existing operations is expected to remain at
similar levels in 2024 and 2025 and then decrease substantially following the completion of
the Phase 3+ Expansion at Island Gold in 2026. Sustaining capital spending at existing
operations is expected to remain relatively stable over the next several years.
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(1) Production and AISC are based on mid-point of guidance.
(2) Refer to the “Non-GAAP Measures and Additional GAAP” disclosure at the end of this press release for a description of these measures .
(3) Total consolidated all-in sustaining costs include corporate and administrative and share based compensation expenses.
460
500 490 490460 480 480
$1,215
$1,125
$1,000
$1,150
$1,025 $1,000
0
100
200
300
400
500
600
700
800
2022E 2023E 2024E 2025E
Production Guidance (000 oz Au)1
2023 – 2025 Production and AISC Guidance
Young Davidson Island Gold
Mulatos Previous guidance
AISC previous guidance (US$/oz) AISC new guidance (US$/oz)
1,2,3 1,2,3
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Young-Davidson
Guidance
Young-Davidson Q3 YTD
2022 Q4 2022 2022A 2022E (3) 2023E 2024E 2025E
Gold Production (000 oz) 148 45 192 185 - 200 185 - 200 185 - 200 185 - 200
Previous Guidance (000 oz) 185 - 200 185 - 200
Total Cash Costs(1) ($/oz) $858 - - $850 - 900 $900 - 950
Mine-site AISC(1),(2) ($/oz) $1,087 - - $1,125 - 1,175 $1,175 - 1,225
Tonnes of ore processed (tpd) 7,919 7,585 7,835 8,000 8,000
Grade processed (g/t Au) 2.31 2.31 2.31 2.15 - 2.35 2.15 - 2.35
Average recovery rate (%) 91% 91% 91% 90 - 92% 90 - 92%
Sustaining capital(1) ($ millions) $34 - - $50 - 55 $50 - 55
Growth capital(1) ($ millions) $14 - - $5 - 10 $5 - 10
Total sustaining & growth capital(1)
(ex. exploration) ($ millions) $47 - - $55 - 65 $55 - 65
Capitalized exploration(1) ($ millions) $4 - - $4 $5
(1) Refer to the "Non-GAAP Measures and Additional GAAP" disclosure at the end of this press release and the Q3 2022 MD&A for a description
and calculation of these measures.
(2) For the purposes of calculating mine-site all-in sustaining costs at individual mine sites, the Company does not include an allocation of corporate
and administrative and share based compensation expenses to the mine sites.
(3) Refers to 2022 guidance announced on January 17, 2022.
Gold production at Young-Davidson over the next three years is expected to be consistent
with 2022 and previous guidance for 2023 and 2024, reflecting similar grades and mining and
processing rates.
Grades mined and processed are expected to range between 2.15 and 2.35 grams per tonne
of gold (“g/t Au”) in 2023 and remain at similar levels through 2025. Grades mined are
expected to increase in 2027 and beyond and average closer to Mineral Reserve grade, as
YD West becomes more of a significant contributor to production.
Total cash costs and mine-site AISC are expected to increase slightly from 2022 levels,
primarily reflecting industry-wide cost inflation. Costs are expected to remain at similar levels
over the next three years.
Capital spending in 2023 (excluding exploration) is expected to range between $55 and $65
million, similar to 2022. Capital spending is expected to remain at similar levels in 2024 and
2025.
Young-Davidson is expected to generate mine-site free cash flow of approximately $100
million in 2022, a significant milestone for the second consecutive year. Given the strong
ongoing performance of the operation since the completion of the lower mine expansion, and
with a 15-year Mineral Reserve life as of the end of 2021, Young-Davidson is well positioned
to generate similar free cash flow in 2023 and over the long-term.
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Island Gold
Guidance
Island Gold Q3 YTD
2022 Q4 2022 2022A 2022E(3) 2023E 2024E 2025E
Gold Production (000 oz) 93 41 134 125 - 135 120 - 135 145 - 160 175 - 190
Previous Guidance (000 oz) 115 - 125 140 - 155
Total Cash Costs(1) ($/oz) $650 - - $550 - 600 $600 - 650
Mine-site AISC(1),(2) ($/oz) $941 - - $850 - 900 $950 - 1,000
Tonnes of ore processed (tpd) 1,233 1,304 1,251 1,200 1,200
Grade processed (g/t Au) 9.25 10.70 9.64 8.8 - 10.8 8.6 - 10.2
Average recovery rate (%) 95% 97% 96% 96 - 97% 96 - 97%
Sustaining capital(1) ($ millions) $26 - - $35 - 40 $45 - 50
Growth capital(1) ($ millions) $63 - - $145 - 160 $165 - 185
Total sustaining & growth capital(1)
(ex. exploration) ($ millions) $90 - - $180 - 200 $210 - 235
Capitalized exploration(1)
($ millions) $14 - - $20 $11
(1) Refer to the "Non-GAAP Measures and Additional GAAP" disclosure at the end of this pre ss release and the Q3 2022 MD&A for a description
and calculation of these measures.
(2) For the purposes of calculating mine -site all-in sustaining costs at individual mine sites, the Company does not include an allocation of corporate
and administrative and share based compensation expenses to the mine sites.
(3) Refers to 2022 guidance announced on January 17, 2022 .
Production guidance for Island Gold has increased 6% for 2023 and 3% for 2024, relative to
previous three-year guidance, reflecting increased grades. Gold production in 2023 is
expected to remain at similar levels as 2022 with similar grades and mining and processing
rates. As outlined in the Phase 3+ Expansion study released in June 2022, grades mined are
expected to increase in 2024, driving production higher. A further increase in grades and
increase in mining rates toward the latter part of 2025, are expected to drive another increase
in production in 2025. Mining rates are expected to increase in 2026 following the completion
of the Phase 3+ Expansion, driving a more significant increase in production.
Total cash costs and mine-site AISC are expected to increase slightly in 2023 compared to
2022, reflecting industry-wide cost inflation. Costs are expected to decrease slightly in 2024
and 2025, reflecting higher grades processed. A further decrease in mine-site AISC is
expected in 2026 and beyond following the completion of the Phase 3+ Expansion.
Capital spending at Island Gold (excluding exploration) is expected to be between $210 and
$235 million in 2023 as spending on the Phase 3+ Expansion ramps up. The first half of 2023
will be focused on construction of the hoist house and headframe, with the sinking of the shaft
expected to commence in the latter part of the year. Capital spending is expected to be
weighted earlier in the year with approximately 55% of the full year budget planned to be
spent in the first half of the year. Consistent with the Phase 3+ Study, capital spending is
expected to remain at similar levels in 2024 and 2025 and then drop considerably in 2026
once the expansion is complete.