Corrected - Eldorado Gold Reports 2018 Year-End and Fourth Quarter Financial and Operational Results
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NEWS RELEASE
TSX: ELD NYSE: EGO February 21, 2019
Corrected - Eldorado Gold Reports 2018 Year-End and Fourth Quarter
Financial and Operational Results
VANCOUVER, BC – Eldorado Gold Corporation, (“Eldorado” or “the Company”) today reports that the Company will
refile on SEDAR at www.sedar.com under the Company’s profile its Audited Consolidated Financial Statements for
the years ending December 31, 2018 and 2017 and corresponding Management’s Discussion and Analysis to
correct certain typographical errors outlined at the end of this release.
In addition, the Company is reissuing its updated press release entitled “Eldorado Gold Reports 2018 Year-End and
Fourth Quarter Financial and Operational Results” as follows in order to correct the typographical errors included in
the prior version as described at the end of this release.
Year End Financial and Operating Results Overview (1)
• 2018 Production was ahead of plan: Annual gold production of 349,147 ounces of gold (2017: 292,971 ounces)
including 35,350 ounces of pre-commercial production from Lamaque.
◦ Exceeded original 2018 guidance of 290,000 – 330,000 ounces of gold.
• 2019 guidance increased ~27% year on year: 2019 guidance is 390,000 – 420,000 ounces of gold (per January
30, 2019 press release).
• Progress at Lamaque: A total of 35,350 pre-commercial ounces were produced during the year, including the
first gold pour from ore processed in the Sigma Mill in December 2018. $189.9 million in capital, including
capitalized exploration was spent at Lamaque in 2018, offset by $39.7 million in pre -commercial revenues. The
Company expects to be in commercial operation at Lamaque in Q1 2019.
• Revenue growth: Total revenue from continuing operations during the year was $459.0 million (2017: $391.4
million). Gold revenue from continuing operations was $386.0 million (2017: $333.3 million) on sales of 304,256
ounces of gold at an average realized gold price of $1,269 per ounce (2017: 264,080 ounces at $1,262 per
ounce).
• Increased cash flow provided by continuing operations : Net cash provided by operating activities of
continuing operations was $66.3 million in 2018 (2017: $30.8 million).
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• Cash operating costs consistent with guidance: Cash operating costs were $625 per ounce sold for 2018
(2017: $509 per ounce) and were in-line with expectations of $600-650 per ounce for 2018.
• Continued solid financial liquidity : The Company closed the year with total liquidity of approximately $543
million, including $293 million in cash, cash equivalents and term deposits, and $250 million in an undrawn line
of credit.
• Net loss attributable to shareholders: 2018 Net loss attr ibutable to shareholders of the Company from
continuing operations was $361.9 million or $2.28 per share, mainly attributable to impairment adjustments of
$447.8 for Olympias and Kisladag. Net loss attributable to shareholders of the Company from continuin g
operations in 2017 was $7.1 million or $0.07 per share. Adjusted net loss attributable to shareholders of the
Company in 2018 was $28.6 million, or $0.17 per share (2017: Adjusted net earnings attributed to shareholders
of the Company of $15.2 million, or $0.10 per share).
• Startup of Olympias: Olympias declared commercial production on December 31, 2017. In 2018, a total of
322,659 tonnes of ore were processed with an average grade of 7.75 g/t Au, resulting in 46,750 payable ounces
of gold produced, at operating cash costs of $764 per ounce sold.
• Kisladag Heap Leach: After the decision to suspend placement of ore on the pad in Q2 2018, recoveries
continued to improve, resulting in production of 172,009 ounces for the year. In Q3 2018, as a result of the
completion of the feasibility study and the Board approval to advance the Kisladag mill project, a review of the
useful lives of the Kisladag heap leach assets resulted in an impairment charge of $117.6 million ($94.1 million
net of deferred income tax) re cognized during the third quarter. In January 2019, the Company announced the
decision to suspend the mill project and resume mining by the end of Q1 2019.
• Free cash flow from resumption of mining and heap leaching at Kisladag: Will provide the opportunit y to
consider initial debt retirement starting later in 2019.
Fourth Quarter 2018 Highlights
• First gold poured at Lamaque: A total of 16,046 ounces of gold were produced during the quarter, including
the first gold pour from ore processed in the Sigma Mill in December.
• Steady cash operating costs: Q4 cash operating costs of $626 per ounce and all-in sustaining costs of $1,200
per ounce including $21 per ounce in non-cash operating costs from inventory change, were in line with Q4
2017 ($577 per ounce and $1,104 per ounce, respectively, for 2017).
• Updated Reserves and Resources: As of September 30, 2018, total Proven and Probable Reserves of 389
million tonnes at 1.35 grams per tonne gold containing 16.9 million ounces were reported.
◦ Added new reserves of 60,000 ounces of gold at Lamaque
◦ Replaced depletion of 80,000 ounces of gold at Efemcukuru
◦ Added 572,000 ounces of gold to the Lamaque Inferred Resources which now total 1.8 million ounces of
gold.
◦ Maiden Inferred Resource at Bolcana in Romania of 381 million tonnes at 0.53 grams per tonne gold and
0.18% copper containing 6.5 million ounces of gold and 686,000 tonnes of copper.
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◦ Share consolidation: In December 2018, the Company completed a 5:1 consolidation of its common
shares.
Eldorado’s President and CEO, George Burns, stated: “As a result of the team ’s hard work in 2018, we are well
positioned to grow annual gold production to over 500,000 ounces in 2020. We expect this will allow us to generate
significant free cash flow and provide us with the opportunity to consider debt retirement later this year.
“The restart of mining and heap leaching at Kisladag is a key part of our path forward. With improved heap leach
recoveries, we expect our revised plan will provide increased free cash flow over the next three years.
“Eldorado’s growth is also supported by the strong momentum at Lamaque. Less than two years after we acquired
the asset, we are set to begin commercial gold production later this quarter. We expect total output at Lamaque,
including pre -commercial production, in excess of 100,000 ounces in 2019. We continue to focus on expansion
possibilities through resource conversion, exploration drilling and increasing mill feed at this core asset.
“Looking ahead, I am confident about our future. Eldorado is a focused gold producer with strong assets and a team
that is committed to driving long-term shareholder value.”
Consolidated Financial and Operational Highlights
Summarized Annual Financial Results
(Continuing operations, except where noted)
2018 2017
Revenue $459.0 $391.4
Gold revenue $386.0 $333.3
Gold produced 349,147 292,971
Gold sold (oz) 6 304,256 264,080
Average realized gold price ($/oz) $1,269 $1,262
Cash operating costs ($/oz) 5 625 509
Total cash costs ($/oz) 5 650 534
All-in sustaining cost ($/oz) 5 994 922
Net earnings from gold mining operations 83.5 121.2
Net loss 1, 2 (361.9 ) (9.9 )
Net loss per share – basic ($/share) 1, 2 (2.28 ) (0.07 )
Adjusted net earnings (loss) 1, 2, 7 (28.6 ) 15.2
Adjusted net earnings (loss) per share ($/share) 1, 2 (0.17 ) 0.10
Cash flow from operating activities 3 61.3 66.5
Dividends paid — (10.6)
Cash, cash equivalents and term deposits 293.0 485.0
Total assets 4,628.9 5,090.3
Total long-term financial liabilities 4 $710.2 $703.7
(1) Includes discontinued operations - China in 2017.
(2) Attributable to shareholders of the Company.
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(3) Before changes in non-cash working capital.
(4) Includes all long-term liabilities except deferred income tax liabilities.
(5) By-product revenues are off-set against costs.
(6) Excludes pre-commercial sales from Lamaque and Olympias.
(7) See reconciliation of net earnings to adjusted net earnings.
Summarized Quarterly Financial Results
(Continuing operations, except where noted)
2018 Q1 Q2 Q3 Q4 2018
Revenue $131.9 $153.2 $81.1 $92.8 $459.0
Gold revenue $115.4 $121.3 $76.0 $73.3 $386.0
Gold produced (oz) 86,634 99,105 84,783 75,887 349,147
Gold sold (oz) 5 86,587 94,224 64,589 58,856 304,256
Average realized gold price ($/oz) $1,333 $1,287 $1,177 $1,245 $1,269
Cash operating cost ($/oz) 4 571 587 754 626 625
Total cash cost ($/oz) 4 598 610 762 666 650
All-in sustaining cost ($/oz) 4 878 934 1,112 1,200 994
Net earnings from gold mining operations 34.7 30.1 4.7 14.0 83.5
Net earnings (loss) 1, 2 8.7 (24.4 ) (128.0 ) (218.2 ) (361.9 )
Net earnings (loss) per share – basic ($/share) 1, 2 0.06 (0.15 ) (0.81 ) (1.38 ) (2.28 )
Adjusted net earnings (loss) 1, 2, 6 14.0 (1.8 ) (21.9 ) (18.9 ) (28.6 )
Adjusted net earnings (loss) per share ($/share) 1, 2 0.09 (0.01 ) (0.14 ) (0.11 ) (0.17 )
Cash flow from operating activities 3 37.9 23.5 23.2 (23.3 ) 61.3
Cash, cash equivalents and term deposits $459.7 $429.8 $385.0 $293.0 $293.0
2017 Q1 Q2 Q3 Q4 2017
Revenue $111.9 $82.7 $95.4 $101.4 $391.4
Gold revenue $90.5 $72.2 $84.4 $86.2 $333.3
Gold produced (oz) 75,172 63,692 70,053 83,887 292,971
Gold sold (oz) 5 74,068 57,206 65,439 67,367 264,080
Average realized gold price ($/oz) $1,222 $1,262 $1,290 $1,280 $1,262
Cash operating cost ($/oz) 4 466 484 508 577 509
Total cash cost ($/oz) 4 483 502 547 602 534
All-in sustaining cost ($/oz) 4 791 846 925 1,104 922
Net earnings from gold mining operations 37.0 28.1 30.1 26.0 121.2
Net earnings (loss) 1, 2 3.8 11.2 (4.2 ) (20.7 ) (9.9 )
Net earnings (loss) per share – basic ($/share) 1, 2 0.03 0.08 (0.03 ) (0.15 ) (0.07 )
Adjusted net earnings (loss) 1, 2 8.0 6.3 1.3 (0.4 ) 15.2
Adjusted net earnings (loss) per share ($/share) 1, 2 0.06 0.04 0.01 (0.02 ) 0.10
Cash flow from operating activities 3 28.2 16.9 16.3 5.1 66.5
Cash, cash equivalents and term deposits $873.9 $752.1 $546.1 $485.0 $485.0
(1) Includes discontinued operations - China in 2017.
(2) Attributable to shareholders of the Company.
(3) Before changes in non-cash working capital.
(4) By-product revenues are off-set against costs.
(5) Excludes pre-commercial sales from Lamaque and Olympias.
(6) See reconciliation of net earnings to adjusted net earnings.
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REVIEW OF FINANCIAL PERFORMANCE
Total revenue of $459.0 million, represented a 17% increase over 2017 revenue of $391.4 million due to increased
gold production. The realized gold price in 2018 was $1,269 per ounce, marginally higher than the realized gold price
of $1,262 per ounce in 2017.
Operating cash costs per ounce sold in 2018 averaged $625, an increase from $509 in 2017, mainly reflecting the
impact of the first year of operations at Olympias in 2018 where operating cash costs per ounce sold were $764 for
the year. Operating cash costs in 2018 were also impacted by a higher non-cash inventory change at Kisladag during
the year. Operating cash costs per ounce sold at Kisladag were $662 in 2018, compared to $500 in 2017, the increase
due primarily to the non-cash inventory change impact of $309 per ounce sold as a result of lower inventory on the
pad in 2018.
Exploration and evaluation expenditures decreased from $38.3 million in 2017 to $33.8 million in 2018. The decrease
for both the year and fourth quarter reflected the exploration focus on brownfields resource expansion at the
Company's mining operations and development projects during 2018. General and administrative expenses of $46.8
million in 2018 decreased 14% from $54.6 million in 2017.
Deferred tax recovery was $86.5 million for 2018 due to the impairment adjustments recorded for Kisladag and
Olympias, together with a 1% decrease in the Greece corporate income tax rate. The corporate income tax rate in
Greece was 29% in 2018 and will gradually decrease 1% each year to 25% by 2022.
Net Loss to Shareholders
In 2018 the net loss to shareholders from continuing operations was $361.9 million, ($2.28 per share) compared to
net loss from continuing operations of $7.1 million and a net loss from discontinuing operations of $2.8 million in 2017,
reflective of the impairment charge of $330.2 million ($247.7 million net of deferred tax) at Olympias in Q4 2018, and
the impairment charge related to Kisladag leach pad assets of $117.6 million ($94.1 million net of tax) in Q3 2018.
In Q4 2018, the Company recorded an impairment adjustment for Olympias of $330.2 million ($247.7 million net of
deferred tax). The Company believes this is reflective of the con tinued jurisdictional risk with obtaining permits in
Greece, and the recent softening of the global concentrate market. As a result, the net loss attributable to shareholders
during the quarter was $218.2 million ($1.38 per share) as compared to a net loss attributable to shareholders for the
quarter ended December 31, 2017 of $20.7 million ($0.15 per share)
In 2018, the adjusted net loss from continuing operations was $28.6 million, compared to adjusted net earnings of
$15.2 million in 2017, a reflection of higher production and gold price in Q4 2017.
The adjusted net loss from continuing operations in Q4 2018 was $18.9 million as compared to Q4 2017 adjusted net
loss of $0.4 million. Adjusted net earnings for Q4 2018 were slightly lower year over year d ue to reduced sales
volumes, and marginally lower gold prices, together with increased production costs due to first year of Olympias
production.
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Operations Update and Outlook
Gold Operations
Gold Operations
3 months ended
December 31,
12 months ended
December 31,
2018 2017 2018 2017 2019 Outlook
Total
Ounces produced 1 75,887 83,887 349,147 292,971 390,000 – 420,000
Cash operating costs ($/oz) $626 $577 $625 $509 $550 – 600
All in sustaining costs ($/oz) 3 1,200 1,104 994 922 900 – 1,000
Sustaining capex $17.2 $24.5 $54.4 $56.8 $80 – 105
Kisladag
Ounces produced 28,196 44,357 172,009 171,358 145,000 – 165,000
Cash operating costs ($/oz) $547 $604 $662 $500 $570 – 620
All in sustaining costs ($/oz) 3 770 n/a 812 n/a n/a
Sustaining capex $4.2 $11.4 $17.8 $27.9 $10 – 15
Efemcukuru
Ounces produced 23,544 25,295 95,038 96,080 90,000 – 100,000
Cash operating costs ($/oz) $535 $525 $511 $524 $550 – 600
All in sustaining costs ($/oz) 3 1,041 n/a 834 n/a n/a
Sustaining capex $9.1 $13.1 $24.4 $28.9 $15 – 20
Olympias
Ounces produced1 8,101 7,174 46,750 18,472 50,000 – 55,000
Cash operating costs ($/oz) $1,237 n/a $764 n/a $550 – 650
All in sustaining costs ($/oz) 3 2,038 n/a 1,297 n/a n/a
Sustaining capex $3.9 n/a 12.2 n/a $20 – 25
Lamaque
Ounces produced 2 16,046 7,061 35,350 7,061 100,000 – 110,000
Cash operating costs ($/oz) n/a n/a n/a n/a $550 – 600
All in sustaining costs ($/oz) 3 n/a n/a n/a n/a n/a
Sustaining capex n/a n/a n/a n/a $35 – 45
(1) Includes pre-commercial production in 2017 and 2018
(2) Includes pre-commercial production at Lamaque.
(3) The Company commenced reporting AISC by site in 2018.
Gold production in 2018 was 349,147 ounces up 19% year on year (2017: 292,971 ounces) due to increased
production at Kisladag, commercial production at Olympias and pre-commercial production at Lamaque. Production
at Efemcukuru remained in-line with 2017. Gold production in Q4 2018 was 75,887 ounces , down 10% quarter on
quarter (Q4 2017: 83,887) due to lower production at Kisladag partially offset by increased production at Lamaque.
For further information on the Company’s operating results for the year -end and fourth quarter of 2018, please see
the Company’s Management’s Discussion and Analysis filed on SEDAR at www.sedar.com under the Company’s
profile.
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Conference Call
A conference call to discuss the details of the Company’s Fourth Quarter and Year End 2018 Results and Technical
Reports will be held by senior management on Friday, February 22, 2019 at 8:30 AM PT (11:30 AM ET). The call will
be webcast and can be accessed at Eldorado Gold ’s we bsite: www.eldoradogold.com and via this link:
http://services.choruscall.ca/links/eldoradogold20190222.html
Conference Call Details Replay (available)
Date: February 22, 2019 Toronto: 1+ 604.638.9010
Time: 8:30 am PT (11:30 am ET) Toll Free: 1.800.319.6413
Dial in: 1+ 604.638.5340 Pass code: 2800
Toll free: 1.800.319.4610
About Eldorado Gold
Eldorado is a gold and base metals producer with mining, development and exploration operations in Turkey, Canada,
Greece, Romania, Serbia, and Brazil. The Company has a highly skilled and dedicated workforce, safe and
responsible operations, a portfolio of high -quality assets, and long -term partnerships with local
communities. Eldorado's common shares trade on the Toronto Stock Exchange (TSX: ELD) and the New York Stock
Exchange (NYSE: EGO).
Contacts
Investor Relations
Peter Lekich, Manager Investor Relations
604.687.4018 or 1.888.353.8166 [email protected]
Media
Louise Burgess, Director Communications & Government Relations
604.687.4018 or 1.888.353.8166 [email protected]
Cautionary Note about Forward-looking Statements and Information
Certain of the statements made and information provided in this press release are forward -looking statements or information within the me aning
of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws. Often, these f orward-looking
statements and forward-looking information can be identified by the use of words such as "plans", "expects", "is expected", "budget", “continue”,
“projected”, "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or the negatives thereof or variations 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 or information contained in this release include, but are not limited to, statements or information with r espect to: our
guidance and outlook, including expected production, cost guidance and recoveries of gold, including higher heap leach recoveries at Kisladag,
favourable economics for our heap leaching plan and the ability to extend heap leach mine life at Kisladag through further me tallurgical tests on
deeper material, planned capital and exploration expenditures; our expecta tion as to our future financial and operating performance, including
expectations around generating significant free cash flow and debt retirement, expected metallurgical recoveries, gold price and global concentrate
outlook; and our strategy, plans and go als, including our proposed exploration, development, construction, permitting and operating plans and
priorities and related timelines and schedules and results of litigation and arbitration proceedings.
Forward-looking statements and forward -looking information by their nature are based on assumptions and involve known and unknown risks,
market uncertainties and other factors, which may cause the actual results, performance or achievements of the Company to be materially different
from any future results, performance or achievements expressed or implied by such forward -looking statements or information.
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We have made certain assumptions about the forward-looking statements and information, including assumptions about the geopolitical, economic,
permitting and legal climate that we operate in; the future price of gold and other commodities; the global concentrate market; exchange rates;
anticipated costs and expenses; production, mineral reserves and resources and metallurgical recoveries, the impact of acq uisitions, dispositions,
suspensions or delays on our business and the ability to achieve our goals. In particular, except where otherwise stated, we have assumed a
continuation of existing business operations on substantially the same basis as exists at the time of this release.
Even though our management believes that the assumptions made and the expectations represented by such statements or informat ion are
reasonable, there can be no assurance that the forward -looking statement or information will pro ve to be accurate. Many assumptions may be
difficult to predict and are beyond our control.
Furthermore, should one or more of the risks, uncertainties or other factors materialize, or should underlying assumptions pr ove incorrect, actual
results may vary materially from those described in forward-looking statements or information. These risks, uncertainties and other factors include,
among others, the following: results of further testwork, recoveries of gold and other metals; geopolitical and economic c limate (global and local),
risks related to mineral tenure and permits; gold and other commodity price volatility; continued softening of the global con centrate market; risks
regarding potential and pending litigation and arbitration proceedings relating t o the Company ’s, business, properties and operations; expected
impact on reserves and the carrying value; the updating of the reserve and resource models and life of mine plans; mining ope rational and
development risk; financing risks, foreign country oper ational risks; risks of sovereign investment; regulatory risks and liabilities including,
environmental regulatory restrictions and liability; discrepancies between actual and estimated production, mineral reserves and resources and
metallurgical testing a nd recoveries; additional funding requirements; currency fluctuations; community and non -governmental organization
actions; speculative nature of gold exploration; dilution; share price volatility; competition; loss of key employees; and de fective title to mineral
claims or properties, as well as those risk factors discussed in the sections titled “Forward-Looking Statements” and "Risk factors in our business"
in the Company's most recent Annual Information Form & Form 40 -F. The reader is directed to carefully review the detailed risk discussion in our
most recent Annual Information Form filed on SEDAR under our Company name, which discussion is incorporated by reference in t his release, for
a fuller understanding of the risks and uncertainties that affect the Company’s business and operations.
Forward-looking statements and information is designed to help you understand management ’s current views of our near and longer term
prospects, and it may not be appropriate for other purposes.
There can be no assurance that forward-looking statements or information will prove to be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly, you should not place undue reliance on the forward -looking statements or
information contained herein. Except as required by law, we do not expect to update forward -looking statements and information continually as
conditions change.
Financial Information and condensed statements contained herein or attached hereto may not be suitable for readers that are unfamiliar with the
Company and is not a substitute for reading the Company’s financial statements and related MD&A available on our website and on SEDAR under
our Company name. The reader is directed to ca refully review such document for a full understanding of the financial information summarized
herein.
Except as otherwise noted, scientific and technical information contained in this press release was reviewed and approved by Paul Skayman,
FAusIMM, Chief Operating Officer for Eldorado Gold Corporation, and a "qualified person" under NI 43 -101.
Mineral resources which are not mineral reserves do not have demonstrated economic viability. With respect to “indicated mineral resource ” and
“inferred mineral r esource”, there is a great amount of uncertainty as to their existence and a great uncertainty as to their economic and legal
feasibility. It cannot be assumed that all or any part of a “measured mineral resource ”, “indicated mineral resource ” or “inferred mineral resource”
will ever be upgraded to a higher category.
Cautionary Note to US Investors Concerning Estimates of Measured, Indicated and Inferred Resources
The terms “mineral resource”, “measured mineral resource ”, “indicated mineral resource ”, “inferred mineral resource ” used herein are Canadian
mining terms used in accordance with NI 43 -101 under the guidelines set out in the Canadian Institute of Mining and Metallurgy and Petroleum
(the “CIM”) Standards on Mineral Resources and Mineral Reserves, a dopted by the CIM Council, as may be amended from time to time. These
definitions differ from the definitions in the United States Securities & Exchange Commission (“SEC”) Industry Guide 7. In the United States, a
mineral reserve is defined as a part of a mineral deposit which could be economically and legally extracted or produced at the time the mineral
reserve determination is made.
While the terms “mineral resource ”, “measured mineral resource, ” “indicated mineral resource ”, and “inferred mineral resour ce” are recognized
and required by Canadian regulations, they are not defined terms under standards in the United States and normally are not pe rmitted to be used