Cerrado GOLD Announces Third Quarter Financial Results
November 28, 2024 www.cerradogold.com
CERRADO GOLD ANNOUNCES THIRD QUARTER FINANCIAL RESULTS
• Gold equivalent production of 16,604 Gold Equivalent Ounces (“GEO”) for Q3; On track
for full year guidance of 50,000-60,000 GEO
• Adjusted EBITDA of $7.4 million for Q3, 2024
• Decrease in the working capital deficit by over US$20 million year to date
TORONTO, ONTARIO – Cerrado Gold Inc. [TSX.V:CERT][OTCQX:CRDOF; FRA:BAI0] (“Cerrado” or the
“Company”) announces its operational and financial results for the third quarter (“Q3/24”) including
its Minera Don Nicolas (“MDN”) gold project in Santa Cruz Province, Argentina and its Mont Sorcier
High Quality Iron Project in Quebec. The Company’s Q3/24 financial results continue to consolidate
the expenses, assets, and liabilities related to the Monte Do Carmo gold project (“MDC”) as the sale
of MDC (the " Transaction") to Amarillo Mineração do Brasil Ltda. (" Amarillo"), a wholly -owned
subsidiary of Hochschild Mining PLC ("Hochschild), was completed subsequent to quarter end. The
sale was in connection with the exercise of Amarillo’s option pursuant to an option agreement dated
March 5, 2024 (the "Option Agreement").
In connection with the Transaction, Cerrado received closing cash payments totaling US$30 million
from Amarillo on November 6, 2024, in addition to the US$15 million that was previously received
in connection with granting the Option. A further two payments totaling US$15 million in aggregate
are expected to be received within the next 28 months bringing the total consideration of the sale
to US$60 million (approximately C$83 million).
Production results for MDN were previously released on October 16, 2024. The Company’s financial
results are reported and available on SEDAR + (www.sedarplus.com) and the Company’s website
(www.cerradogold.com).
Q3/24 MDN Operating Highlights
• Q3/24 production of 16,604 GEO
• Q3/24 Adjusted EBITDA of $7.4 million
• AISC of $1,678 during Q3; focus on cost reduction initiatives has begun
• Recent 43-101 Mineral Resource Update and Preliminary Economic Assessment Completed
for MDN showing an NPV5% of $111MM at $2,100 oz gold price over a 5 year mine life
• Focus remains on delivering cashflow and strengthening the balance sheet with significant
progress made towards debt reduction during the quarter
-2-
Operational results for Q3 2024 demonstrated a slight increase in production over the previous
quarter, highlighting greater stability in operations. Ore from the Calandrias Norte high-grade open
pit was exhausted late in the quarter and is now being replaced by additional high-grade feed from
two additional pits. The CIL plant is now expected to continue production until early 2025 as
operations continue to transition to solely heap leach production. The ramp up of heap leach
operations continued to improve as crushing capacity continued to climb with record production of
1,664 GEO in August before a slight decline in September as some adjustments were put in place to
support the overall expansion of the facilities. The performance of the heap leach continues to
depend on the output of the crushing circuit. The installation of the secondary crusher is expected
to reduce fleet and operating costs. The new circuit is expected to be fully operational by the end of
the 4th quarter, at which time the mobile crushers will be placed on standby. Recovery rates are in
line with expectations given ore on the pad to date.
Mark Brennan, CEO and Chairman commented, "The results from this quarter further confirm we
have entered into a more stable period of operations. We expect this to continue for the rem ainder
of the year as the heap leach operation continues to ramp up to its expanded capacity. The cashflow
from operations, combined with funds received from the sale of the MDC project , have had a
significant positive impact on our working capital position , and we are now positioned to deploy
capital in a strategic and fiscally prudent manner to ramp up exploration efforts at MDN, complete
a bankable feasibility study at our high grade Mont Sorcier iron project and fund our recently
announced normal course issuer bid.”
Q3 Financial Performance
-3-
Table 1. Q3 2024 Operational and Financial Performance
Key Operating Information Unit 2024 2023 2024 2023
Operating Data
High Grade CIL Operations
Ore Mined ktonnes 43.43 57.50 187.06 205.65
Waste Mined ktonnes 1,234.99 880.61 4,416.83 3,103.65
Total Mined ktonnes 1,278.41 938.11 4,603.88 3,309.30
Strip Ratio waste/ore 28.44 15.32 23.61 15.09
Mining rate ktpd 13.90 10.20 16.86 12.12
Ore Milled ktonnes 98.65 83.37 254.69 273.93
Head Grade Au g/t 4.58 3.19 4.90 4.25
Head Grade Ag g/t 7.86 5.16 9.99 5.29
Recovery Au % 92% 93% 91% 89%
Recovery Ag % 64% 65% 58% 65%
Mill Throughput tpd 1,072 906 933 1,003
Gold Ounces Produced oz 13,022 9,446 36,549 35,575
Silver Ounces Produced oz 15,047 7,858 47,441 30,715
Gold Equivalent Ounces Produced oz 13,201 9,544 37,108 35,948
Heap Leach Operations
Ore Mined ktonnes 364.84 236.61 716.24 378.38
Waste Mined ktonnes 884.78 468.66 2,111.90 780.55
Total Mined ktonnes 1,249.62 705.28 2,828.14 1,158.93
Strip Ratio waste/ore 2.43 1.98 2.95 2.06
Mining rate ktpd 13.58 7.67 10.36 4.25
Ore placed on pad ktonnes 433.81 237.94 949.87 378.20
Head Grade Au g/t 0.75 0.52 0.74 0.52
Head Grade Ag g/t 10.04 4.22 10.69 4.47
Recovery Au % 31% 13% 30% 13%
Recovery Ag % 9% 3% 8% 3%
Gold Ounces Produced oz 3,253 526 6,646 526
Silver Ounces Produced oz 12,713 951 25,639 951
Gold Equivalent Ounces Produced oz 3,403 538 6,955 538
Consolidated Gold Production
Gold Ounces Produced oz 16,275 9,972 43,195 36,101
Silver Ounces Produced oz 27,760 8,809 73,079 31,665
Gold Equivalent Ounces Produced oz 16,604 10,082 44,063 36,486
Gold Ounces Sold oz 15,505 11,263 41,108 38,175
Silver Ounces Sold oz 28,505 9,071 70,764 33,662
Gold Equivalent Ounces Sold oz 15,844 11,374 41,949 38,582
Average realized price and Average realized margin
Metal Sales $ 000's 36,669 21,574 91,786 70,225
Cost of Sales $ 000's 29,257 20,270 75,972 57,712
Gross Margin from Mining Operations $ 000's 7,412 1,304 15,814 12,513
Average realized price per gold ounce sold (1) $/oz 2,329 1,897 2,192 1,819
Total cash costs per gold ounce sold (1) $/oz 1,617 1,689 1,556 1,349
Average realized margin per gold ounce sold (1) $/oz 712 207 635 470
Total Direct Operating Costs (1) $ 000's 22,563 17,336 60,708 44,458
Royalties and production taxes (1) $ 000's 2,514 1,691 3,276 7,037
Total Cash Costs (1) $ 000's $25,077 $19,027 $63,984 $51,495
Total direct operating costs per gold ounce sold (1) $/oz 1,455 1,539 1,477 1,165
Royalties and production taxes per gold ounce sold (1) $/oz 162 150 80 184
Total cash costs per gold ounce sold (1) $/oz $1,617 $1,689 $1,556 $1,349
AISC - Minera Don Nicolas (1) $/oz $1,678 $1,703 $1,580 $1,359
(1) This is a non-IFRS performance measure, see non-IFRS Performance Measures
Three Months Ended September 30 Nine months ended September
-4-
The Company produced 16,604 GEO during the third quarter ended September 30, 2024, as
compared to 10,082 GEO for the third quarter ended September 30, 2023. Production is higher in
the three months ended September 30, 2024, due to 44% higher gold head grade and 18% higher
throughput.
The Company generated revenue of $36.7 million for the third quarter ended September 30, 2024,
from the sale of 15,505 ounces of gold and 28,505 ounces of silver at an average realized price per
gold ounce sold of $2,329. For the third quarter ended September 30, 2023, the Company generated
revenue of $21.6 million from the sale of 11,263 ounces of gold and 9,071 ounces of silver at an
average realized price per gold ounce sold of $1,897. Revenue and sales of gold for the current
period are higher than the quarter ended September 30, 2023, due to higher ounces sold and higher
average realized gold price.
Cost of sales for the third quarter ended September 30, 2024, were $29.3 million as compared to
$20.3 million for the quarter ended September 30, 2023. The Company incurred $5.6 million higher
production costs for the third quarter ended September 30, 2024 , due primarily to higher labour
costs.
Total cash costs (including royalties) per ounce sold were $1,617 per ounce in the third quarter
ended September 30, 2024, as compared to $1,689 per ounce for the third quarter ended
September 30, 2023 , a $72 per ounce decrease (refer to reconciliation of Non -IFRS performance
metrics). The decrease is a result of higher ounces sold in 2024 as compared to 2023.
Net income for the third quarter ended September 30, 2024, was $1.5 million as compared to a $0.4
million net loss for the third quarter ended September 30, 2023. The decrease in net loss is primarily
a result of an increase in revenue offset by higher other expenses.
The Company incurred general and administrative expenses of $2.9 million for the third quarter
ended September 30, 2024, as compared to $3.3 million of general and administrative expenses
incurred during the third quarter ended September 30, 2023. For the three months ended
September 30, 2024 , there was a decrease in share based payments expense of $0.4 million and
office expense of $0.3 million offset by an increase in professional fees of $0.3 million.
Other expense of $2.1 million during the third quarter ended September 30, 2024, includes finance
expense of $1.6 million, foreign exchange gain of $6.4 million, loss on fair value remeasurement of
Corporate Financial Highlights Unit 2024 2023 2024 2023
Financial Data
Total revenue $ 000's 36,669 21,574 91,786 70,225
Mine operating expenses $ 000's 29,257 20,270 75,972 57,712
Income from mining operations $ 000's 7,412 1,304 15,814 12,513
Net income (loss) $ 000's 1,540 (404) (4,701) (8,270)
Adjusted EBITDA (1) $ 000's 7,435 30 19,856 13,064
Operating cash flow before movements in working capital (1) $ 000's 13,309 2,314 23,114 19,349
Operating cash flow $ 000's 6,768 10,268 14,643 37,543
Cash and cash equivalents $ 000's 7,949 11,565 7,949 11,565
Working capital (deficiency) $ 000's (47,179) (58,338) (47,179) (58,338)
Capital Expenditures $ 000's 1,669 13,583 8,196 34,822
(1) This is a non-IFRS performance measure, see non-IFRS Performance Measures
Three Months Ended September 30 Nine months ended September
-5-
MDN stream obligation of $2.4 million and loss on fair value remeasurement of MDC secured note
and stream obligation of $3.1 million.
Normal Course Issuer Bid
As previously announced on November 13, 2024 , the Company announced TSX Venture Exchange
approval for the Company’s notice to implement a normal course issuer bid (the "NCIB") permitting
the Company to repurchase, for cancellation, up to 5,170,903 common shares ("Common Shares")
of the Company, representing 5% of the issued and outstanding Common Shares.
Share Incentive Issuances
The Company also announces it has issued 200,000 share purchase options at an exercise price of
C$0.365 for a period of 2 years to a third party consultant of the Company.
Review of Technical Information
The scientific and technical information in this press release has been reviewed and approved by
Sergio Gelcich, P.Geo., Vice President, Exploration for Cerrado Gold Inc., who is a Qualified Person
as defined in National Instrument 43-101.
About Cerrado
Cerrado Gold is a Toronto-based gold production, development, and exploration company focused
on gold projects in South America. The Company is the 100% owner of both the producing Minera
Don Nicolás and Las Calandrias mine in Santa Cruz province, Argentin a. In Canada, Cerrado Gold is
developing its 100% owned Mont Sorcier Iron Ore and Vanadium project located outside of
Chibougamou, Quebec.
In Argentina, Cerrado is maximizing asset value at its Minera Don Nicolas operation through
continued operational optimization and is growing production through its operations at the Las
Calandrias heap leach project. An extensive campaign of exploration is ongoing to further unlock
potential resources in our highly prospective land package in the heart of the Deseado Masiff.
In Canada, Cerrado holds a 100% interest in the Mont Sorcier Iron Ore and Vanadium project, which
has the potential to produce a premium iron ore concentrate over a long mine life at low operating
costs and low capital intensity. Furthermore, its high grad e and high purity product facilitates the
migration of steel producers from blast furnaces to electric arc furnaces , contributing to the
decarbonization of the industry and the achievement of sustainable development goals.
For more information about Cerrado please visit our website at: www.cerradogold.com.
Mark Brennan
CEO and Chairman
Mike McAllister
Vice President, Investor Relations
Tel: +1-647-805-5662
-6-
Disclaimer
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS
DEFINED IN POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE
ADEQUACY OR ACCURACY OF THIS RELEASE.
This press release contains statements that constitute “forward -looking information” (collectively,
“forward-looking statements”) within the meaning of the applicable Canadian securities legislation.
All statements, other than statements of historical fact , are forward -looking statements and are
based on expectations, estimates and projections as at the date of this news release. Any statement
that discusses predictions, expectations, beliefs, plans, projections, objectives, assumptions, future
events or performance (often but not always using phrases such as “expects”, or “does not expect”,
“is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”,
“estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain
actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be
achieved) are not statements of historical fact and may be forward-looking statements.
Forward-looking statements contained in this press release include, without limitation, statements
regarding the business and operations of Cerrado, anticipated continued improvements in operating
results and working capital position, receipt of funds due from Amarillo within 28 months, stabilizing
operations at MDN, ramp up of the heap leach operation and assumptions set out in the PEA . In
making the forward- looking statements contained in this press release, Cerrado has made certain
assumptions. Although C errado believes that the expectations reflected in forward -looking
statements are reasonable, it can give no assurance that the expectations of a ny forward-looking
statements will prove to be correct. Known and unknown risks, uncertainties, and other factors which
may cause the actual results and future events to differ materially from those expressed or implied
by such forward -looking statements. Such factors include, but are not limited to general business,
economic, competitive, political and social uncertainties. Accordingly, readers should not place
undue reliance on the forward -looking statements and information contained in this press release .
Except as required by law, Cerrado disclaims any intention and assumes no obligation to update or
revise any forward -looking statements to reflect actual results, whether as a result of new
information, future events, changes in assumptions, changes in f actors affecting such forward -
looking statements or otherwise.