Eldorado Gold Reports Q2 2021 Financial and Operational Results
NEWS RELEASE
TSX: ELD NYSE: EGO July 29, 2021
Eldorado Gold Reports Q2 2021
Financial and Operational Results
VANCOUVER, BC - Eldorado Gold Corporation (“Eldorado” or “the Company”) today reports the Company’s
financial and operational results for the second quarter of 2021.
• Quarterly production in line with expectations; full year 2021 annual guidance: Gold production totalled
116,066 ounces in Q2 2021, a decrease of 16% from Q2 2020 production of 137,782 ounces and a 4% increase
over Q1 2021, driven by a planned shift to lower-grade ore at Kisladag. Eldorado is maintaining its 2021 annual
production guidance of 430,000-460,000 ounces of gold at an all-in sustaining cost of $920-1,150 per ounce
sold.
• All-in sustaining costs: Q2 2021 all-in sustaining costs of $1,074 per ounce of gold sold in the quarter
increased from Q2 2020 ($859 per ounce sold) as a result of lower production in the quarter and increased from
Q1 2021 ($986 per ounce sold) primarily as a result of AISC in that quarter benefiting from a reversal of accrued
royalty expense.
• Net loss and adjusted net earnings attributable to shareholders: Net loss attributable to shareholders of the
Company in Q2 2021 was $55.7 million, or $0.31 loss per share (Q2 2020: $49.1 million or $0.29 earnings per
share, Q1 2021: $11.9 million or $0.07 earnings per share)(1). Adjusted net earnings attributable to shareholders
of the Company in Q2 2021 were $29.3 million, or $0.16 earnings per share ( Q2 2020: $47.2 million or $0.28
earnings per share, Q1 2021: $24.6 million or $0.14 earnings per share)(1).
• EBITDA: Q2 2021 EBITDA was $7.6 million (Q2 2020: $131.8 million Q2 2020 $105.3 million) and Q2 2021
adjusted EBITDA was $101.9 million (Q2 2020 : $135.8 million, Q2 2020: $108.0 million). Material adjustments
in Q2 2021 included a $99.5 million ($89.5 million net of deferred tax) impairment of the Tocantinzinho project, a
non-core gold asset, as a result of a plan to consider selling the project.
• Free cash flow: Negative free cash flow of $36.6 million in Q2 2021 decreased from free cash flow of $63.4
million in Q2 2020 as a result of higher capital spend and lower sales. A decrease from free cash flow of $24.6
million in Q1 2021 was primarily due to increased growth capital spending, increased tax payments and the
timing of royalty and interest payments. We expect free cash flow generation to improve in the second half of
2021.
• Financial position: Debt repayments in Q2 2021 included $50 million on the Company's revolving credit facility
and $22 million on the Company's term loan. At June 30, 2021, the Company had $410.7 million of cash, cash
equivalents and term deposits and approximately $150 million available under its revolving credit facility.
• Capital spending: Capital expenditures totalled $72.5 million in Q2 2021 (Q2 2020 : $37.1 million, Q1 2021:
$64.9 million), reflecting a planned increased in growth capital spending and following reduced spending in the
prior year due to the novel coronavirus ("COVID-19") pandemic. Capital allocation is following a rigorous
process to ensure discipline and control at all operations.
◦ At Kisladag, $29.4 million investment in the quarter related to waste stripping, construction of the north
leach pad to support the mine life extension and installation of a high-pressure grinding roll ("HPGR")
circuit, which is expected to improve heap leach recovery with commissioning now scheduled to initiate
at the start of Q4 2021.
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◦ At Lamaque, $8.9 million investment in the quarter related primarily to the decline connecting the
Triangle underground mine with the Sigma mill, which is expected to reduce operating costs, reduce
greenhouse gas emissions, and provide access for underground drill platforms for Ormaque, Plug 4,
and other exploration targets in the prospective corridor.
• Optimization of the Kassandra mines: Operations at Olympias were negatively affected in Q2 2021 as the
Company progresses through the implementation of transformation efforts at its Kassandra mines. Discussions
with stakeholders are ongoing and are expected to lead to a sustainable continuous improvement program as
the year progresses.
• Measures remain in place to manage the impact of the COVID-19 pandemic: The Company's mines remain
fully operational and isolated cases of COVID-19 have been successfully managed. Preventing the spread of
COVID-19, ensuring safe working environments across Eldorado's global sites, and preparedness should an
outbreak occur, remain priorities.
(1) 2020 and YTD 2021 amounts have been recast to correct an immaterial error related to an understatement of the net book value of certain of our property,
plant and equipment as a result of errors in the amounts recorded for depreciation. See Note 2(c) of our Unaudited Condensed Consolidated Interim
Financial Statements.
“We delivered strong production this quarter driven by Kisladag and Lamaque and we continue to be on track to
meet our 2021 production and cost guidance," said George Burns, President and CEO. “We ended the quarter with
a cash balance of just over $410 million and are maintaining a strong liquidity position as we continue to grow our
business. Our balance sheet continues to emerge as a major strength, which will enable us to fund growth and
maximize the opportunities ahead of us.”
“In line with our growth strategy, we are investing capital into our operations, particularly at Kisladag and Lamaque,
to deliver value from our portfolio of assets. Equally, the Kassandra mines represent a significant opportunity for the
company to develop our top tier assets in Europe. In Greece, we continue to work through transformation efforts
focused on increasing productivity and are actively engaged with our key stakeholders on this front.”
“With strong operational results in the first half of 2021 and numerous upcoming catalysts expected in the second
half of the year, Eldorado remains well positioned for growth and value creation in the future.”
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Consolidated Financial and Operational Highlights
3 months ended June 30, 6 months ended June 30,
2021 2020 2021 2020
Revenue $233.2 $255.9 $457.8 $460.6
Gold revenue $209.5 $232.9 $405.1 $416.6
Gold produced (oz) 116,066 137,782 227,808 253,732
Gold sold (oz) 114,140 134,960 227,734 251,179
Average realized gold price ($/oz sold) (4) $1,835 $1,726 $1,779 $1,658
Cash operating costs ($/oz sold) (1,4) 645 550 643 586
Total cash costs ($/oz sold) (1,4) 746 616 716 644
All-in sustaining costs ($/oz sold) (1,4) 1,074 859 1,030 902
Net (loss) earnings for the period (2,5) (55.7) 49.1 (43.8) 46.2
Net (loss) earnings per share – basic ($/share) (2,5) (0.31) 0.29 (0.25) 0.27
Adjusted net earnings (loss) (2,3,4,5) 29.3 47.2 53.9 61.7
Adjusted net earnings (loss) per share ($/share) (2,3,4,5) 0.16 0.28 0.30 0.37
Cash flow from operating activities before changes in working capital (4) 62.8 99.0 141.6 168.5
Free cash flow (4) (36.6) 63.4 (12.0) 70.5
Cash, cash equivalents and term deposits $410.7 $440.3 $410.7 $440.3
(1) By-product revenues are off-set against cash operating costs.
(2) Attributable to shareholders of the Company.
(3) See reconciliation of net earnings (loss) to adjusted net earnings (loss) in the section 'Non-IFRS Measures' in the June 30, 2021 MD&A.
(4) These measures are non-IFRS measures. See the June 30, 2021 MD&A for explanations and discussion of these non-IFRS measures.
(5) 2020 and YTD 2021 amounts have been recast to correct an immaterial error related to an understatement of the net book value of certain of our property,
plant and equipment as a result of errors in the amounts recorded for depreciation. See Note 2(c) of our Unaudited Condensed Consolidated Interim
Financial Statements.
Gold production of 116,066 ounces decreased 16% from last year’s second quarter production of 137,782 ounces.
Gold sales in Q2 2021 totalled 114,140 ounces, a decrease of 15% from 134,960 ounces sold in Q2 2020. The
lower sa les volume compared with the prior year primarily reflects decreases in production at Kisladag and
Olympias.
Total revenue was $233.2 million in Q2 2021, a decrease from $255.9 million in Q2 2020. Total revenue was $457.8
million in the six months ended June 30, 2021 , a decrease from $460.6 million in the six months ended June 30,
2020. The decreases in both three and six-month periods were due to lower sales volumes and were partially offset
by higher average realized gold prices.
Cash operating costs in Q2 2021 averaged $645 per ounce sold, an increase from $550 in Q2 2020, and cash
operating costs per ounce sold averaged $643 in the six months ended June 30, 2021, an increase from $586 in the
six months ended June 30, 2020 . Increases in both the three and six-month periods were primarily due to lower-
grade ore mined and processed at Kisladag, Lamaque, and Olympias, resulting in fewer ounces produced and sold.
These increases were partially offset by a modest reduction in cash operating costs per ounce sold at Efemcukuru
as a result of the weakening of the Turkish Lira from Q2 2020 and a change in the structure of concentrate contracts
whereby lower payable ounces are offset by the elimination of treatment charges and other deductions.
We reported net loss attributable to shareholders of $55.7 million ($0.31 loss per share) in Q2 2021, compared to
net earnings of $49.1 million ($0.29 per share) in Q2 2020 and net loss of $43.8 million ($0.25 loss per share) in the
six months ended June 30, 2021 compared to net earnings of $46.2 million ($0.27 per share) in the six months
ended June 30, 2020 . The decreases in both periods were primarily due to the $99.5M impairment loss related to
the Tocantinzinho project, and also reflects lower production and sales volumes, which were partially offset by lower
income tax expense.
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Adjusted net earnings were $29.3 million ($0.16 per share) in Q2 2021 compared to $47.2 million ($0.28 per share)
in Q2 2020. Adjusted net earnings in Q2 2021 removes, among other things, the $99.5 million i mpairment of the
Tocantinzinho project, the $6.2 million loss on the non-cash revaluation of the derivative related to redemption
options in our debt, the $5.3 million net recovery of deferred tax relating to tax rate changes in Greece and Turkey
and the $7.0 million ($5.3 million net of tax) gain on sale of mining licences in Turkey.
Gold Operations
3 months ended June 30, 6 months ended June 30,
2021 2020 2021 2020
Total
Ounces produced 116,066 137,782 227,808 253,732
Ounces sold 114,140 134,960 227,734 251,179
Cash operating costs ($/oz sold) (1,2) $645 $550 $643 $586
All-in sustaining costs ($/oz sold) (1,2) $1,074 $859 $1,030 $902
Sustaining capital expenditures (2) $24.2 $21.9 $44.7 $41.3
Kisladag
Ounces produced 44,016 59,890 90,188 110,066
Ounces sold 44,049 59,917 91,555 111,517
Cash operating costs ($/oz sold) (1,2) $529 $465 $510 $459
All-in sustaining costs ($/oz sold) (1,2) $728 $630 $665 $606
Sustaining capital expenditures (2) $3.7 $5.4 $6.5 $8.4
Lamaque
Ounces produced 35,643 33,095 64,478 60,448
Ounces sold 34,677 31,964 63,755 58,692
Cash operating costs ($/oz sold) (1,2) $658 $480 $704 $553
All-in sustaining costs ($/oz sold) (1,2) $1,065 $796 $1,109 $908
Sustaining capital expenditures (2) $11.0 $8.0 $20.3 $16.3
Efemcukuru
Ounces produced 23,473 26,876 46,771 50,115
Ounces sold 23,006 25,692 47,136 48,913
Cash operating costs ($/oz sold) (1,2) $525 $534 $525 $586
All-in sustaining costs ($/oz sold) (1,2) $917 $807 $802 $835
Sustaining capital expenditures (2) $3.8 $3.6 $6.3 $6.7
Olympias
Ounces produced 12,934 17,921 26,371 33,103
Ounces sold 12,409 17,387 25,288 32,057
Cash operating costs ($/oz sold) (1,2) $1,237 $993 $1,190 $1,086
All-in sustaining costs ($/oz sold) (1,2) $1,893 $1,377 $1,845 $1,500
Sustaining capital expenditures (2) $5.7 $4.9 $11.5 $9.9
(1) By-product revenues are off-set against cash operating costs.
(2) These measures are non-IFRS measures. See the June 30, 2021 MD&A for explanations and discussion of these non-IFRS measures.
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Kisladag
Kisladag produced 44,016 ounces of gold in Q2 2021, a decrease of 27% from 59,890 ounces in Q2 2020. The
decrease was the result of a planned shift to lower-grade ore through 2021 as compared to 2020. Production was in
line with expectations for the quarter and solution processing rates have increased as a result of the installation of
two additional multi-stage carbon-in-column sets during Q1 2021.
Cash operating costs per ounce sold increased to $529 in Q2 2021 from $465 in Q2 2020 . The increase was
primarily due to lower production and sales volumes, a result of lower grade ore mined in the quarter, and was
partially offset by lower costs as a result of the weakening of the Turkish Lira from Q2 2020.
AISC per ounce sold increased to $728 in Q2 2021 from $630 in Q2 2020, as a result of lower production and sales.
AISC per ounce sold was positively impacted in Q2 2021 by reduced sustaining capital spending as compared to
Q2 2020. Sustaining capital expenditures of $3.7 million in Q2 2021 primarily included process upgrades and mine
equipment overhauls.
Lamaque
Lamaque produced 35,643 ounces of gold in Q2 2021, an 8% increase from 33,095 ounces in Q2 2020 despite a
planned shift to lower-grade ore stopes. Average grade was 5.98 grams per tonne in Q2 2021 an increase from 5.17
grams per tonne in Q1 2021 but lower than 7.25 grams per tonne in Q2 2020. Grade is expected to improve at
Lamaque in the second half of 2021.
Cash operating costs per ounce sold increased to $658 in Q2 2021 from $480 in Q2 2020, primarily reflecting the
planned shift to lower-grade ore and were negatively impacted by a stronger Canadian dollar in the quarter as
compared to Q2 2020.
AISC per ounce sold increased to $1,065 in Q2 2021 from $796 in Q2 2020 and included $11.0 million of sustaining
capital expenditure related primarily to underground development, underground infrastructure improvements and
tailings management.
Growth capital expenditures of $8.9 million in Q2 2021 and $16.0 million in the six months ended June 30, 2021
primarily included continued development of the decline from the Sigma mill to the Triangle mine which commenced
in Q3 2020 and remains on schedule for completion in Q4 2021. Following completion, the decline is expected to
reduce operating costs, reduce greenhouse gas emissions, and provide access for underground drill platforms for
Ormaque, Plug 4, and other exploration targets in the prospective corridor between the Triangle underground mine
and the Sigma mill.
Efemcukuru
Efemcukuru produced 23,473 ounces of gold in Q2 2021 , a 13% decrease from 26,876 ounces in Q2 2020
reflecting a slight decrease in tonnes milled combined with lower average grade. Production in 2021 has also been
adjusted to reflect reduced payable ounces, following a change in structure of concentrate sales contracts. The
lower payable ounces under the new contracts are offset by a decrease in production costs due to the elimination of
treatment charges and other deductions.
Cash operating costs per ounce sold improved to $525 in Q2 2021 from $534 in Q2 2020. Cash operating costs in
Q2 2021 benefited from lower selling costs due to the change in structure of concentrate sales contracts and lower
costs resulting from the weakening of the Turkish Lira. These decreases were partly offset by a decrease in average
grade to 6.60 in Q2 2021 from 7.21 in Q2 2020.
AISC per ounce sold increased to $917 in Q2 2021 from $807 in Q2 2020. The increase is primarily due to higher
royalty expense as a result of a 25% increase to gold royalty rates, effective from September 2020. Sustaining
capital expenditure of $3.8 million in Q2 2021 primarily included underground development, resource conversion
drilling and process upgrades.
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Olympias
Olympias produced 12,934 ounces of gold in Q2 2021 , a 28% decrease from 17,921 ounces in Q2 2020 . The
decrease reflected lower processing volumes in the quarter, combined with lower average gold grade. Lead, silver
and zinc production was also lower in Q2 2021 as compared to Q2 2020 primarily a result of lower processing
volumes, a modest increase in lead and silver average grades and a modest decrease in zinc average grade.
Operations at Olympias were negatively affected in Q2 2021 by work slowdowns as the Company progresses
through the implementation of transformation efforts at its Kassandra mines. Discussions with stakeholders are
ongoing and are expected to lead to a sustainable continuous improvement program as the year progresses.
Further improvement is underway to long range mine design and planning based on updated geotechnical
guidance.
Cash operating costs per ounce sold increased to $1,237 in Q2 2021 from $993 in Q2 2020 primarily a result of
decreased production and lower silver and base metal sales, which reduce cash operating costs as by-product
credits.
AISC per ounce sold increased to $1,893 in Q2 2021 from $1,377 in Q2 2020 in line with higher cash operating
costs and an increase in royalties following ratification of the Amended Investment Agreement in March 2021. AISC
was also negatively impacted by an increase in sustaining capital expenditure to $5.7 million in Q2 2021 from $4.9
million in Q2 2020 . Sustaining capital expenditure in Q2 2021 primarily included underground development,
diamond drilling and tailings facility construction.
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Conference Call
A conference call to discuss the details of the Company’s Q2 2021 results will be held by senior management on
Friday, July 30, 2021 at 11:30 AM ET (8:30 AM PT). The call will be webcast and can be accessed at Eldorado’s
website: www.eldoradogold.com and via this link: http://services.choruscall.ca/links/eldoradogold20210730.html.
Conference Call Details Replay (available until Sept. 3, 2021)
Date: July 30, 2021 Vancouver: +1 604 638 9010
Time: 11:30 AM ET (8:30 AM PT) Toll Free: 1 800 319 6413
Dial in: +1 604 638 5340 Access code: 7013
Toll free: 1 800 319 4610
About Eldorado
Eldorado is a gold and base metals producer with mining, development and exploration operations in Turkey,
Canada, Greece, Romania 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).
Contact
Investor Relations & Media
Lisa Wilkinson, VP, Investor Relations
604.757.2237 or 1.888.353.8166 [email protected]
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Non-IFRS Measures
Certain non-IFRS measures are included in this press release, including average realized gold price per ounce sold, cash operating costs and
cash operating costs per ounce sold, total cash costs and total cash costs per ounce sold, all-in sustaining costs ("AISC") and AISC per ounce
sold, adjusted net earnings/(loss), adjusted net earnings/(loss) per share, working capital, cash flow from operations before changes in non-cash
working capital, earnings before interest, taxes and depreciation and amortization ("EBITDA") and adjusted earnings before interest, taxes and
depreciation and amortization ("Adjusted EBITDA"), free cash flow and sustaining capital. Please see the June 30, 2021 MD&A for explanations
and discussion of these non-IFRS measures. The Company believes that these measures, in addition to conventional measures prepared in
accordance with International Financial Reporting Standards (“IFRS”), provide investors an improved ability to evaluate the underlying
performance of the Company. The non-IFRS measures are intended to provide additional information and should not be considered in isolation
or as a substitute for measures of performance prepared in accordance with IFRS. These measures do not have any standardized meaning
prescribed under IFRS, and therefore may not be comparable to other issuers.
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 meaning
of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws. Often, these forward-looking
statements and forward-looking information can be identified by the use of words such as "anticipates", "believes", "budget", "continue",
"expected", "expects", "forecast", "guidance", "intended", "ongoing", "opportunity", "plans", "scheduled" 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 respect to: the
Company’s 2021 annual guidance; plans to sell the Tocantinzinho project; construction of the decline connecting Sigma mill with the Triangle
underground mine, including the timing of completion and anticipated benefits; continued drilling at the Ormaque gold resource, completion of the
HPGR circuit, including the timing of completion; expected tax expense in Turkey; the optimization of Greek operations, including the benefits
and risks thereof; development of the Kassandra mines, including expected benefits thereof; expected depreciation expense for 2021; our
expectation as to our future financial and operating performance, including expectations concerning generating free cash flow; working capital
requirements; debt repayment obligations; use of proceeds from financing activities; expected metallurgical recoveries and improved concentrate
grade and quality; and risk factors affecting our business; our strategy, plans and goals, including our proposed exploration, development,
construction, permitting and operating plans and priorities and related timelines.
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.
We have made certain assumptions about the forward-looking statements and information, including assumptions about: our preliminary gold
production and our guidance, timing of construction of the decline between Sigma mill and the Triangle underground mine; results from drilling at
Ormaque; benefits of the improvements at Kisladag; how the world-wide economic and social impact of COVID-19 is managed and the duration
and extent of the COVID-19 pandemic; timing and cost of construction and exploration; 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, expenses
and working capital requirements; production, mineral reserves and resources and metallurgical recoveries; the impact of acquisitions,
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 information are
reasonable, there can be no assurance that the forward-looking statement or information will prove 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 prove incorrect, actual
results may vary materially from those described in forward-looking statements or information. These risks, uncertainties and other factors
include, among others: inability to meet production guidance, inability to complete construction of the decline between Triangle mill and the
Triangle underground mine on time or to meet expected timing thereof, poor results from drilling at Ormaque; inability to complete improvements
at Kisladag or to meeting expected timing thereof, or to achieve the benefits thereof; inability to assess taxes in Turkey or depreciation expenses;
global outbreaks of infectious diseases, including COVID-19; timing and cost of construction, and the associated benefits; recoveries of gold and
other metals; geopolitical and economic climate (global and local), risks related to mineral tenure and permits; gold and other commodity price
volatility; information technology systems risks; continued softening of the global concentrate market; risks regarding potential and pending
litigation and arbitration proceedings relating to our 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 operational and development risk; financing risks; foreign country
operational 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 and recoveries; additional
funding requirements; currency fluctuations; community and non-governmental organization actions; speculative nature of gold exploration;
dilution; share price volatility and the price of our common shares; competition; loss of key employees; and defective title to mineral claims or
properties, as well as those risk factors discussed in the sections titled “Forward-looking Statements and Information” 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 and EDGAR under our Company name, which discussion is incorporated
by reference in this release, for a fuller understanding of the risks and uncertainties that affect the Company’s business and operations.
The inclusion of 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
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