Eldorado Gold Reports Q2 2023 Financial and Operational Results; Well Positioned to Meet 2023 Guidance
NEWS RELEASE
TSX: ELD NYSE: EGO July 27, 2023
Eldorado Gold Reports Q2 2023 Financial and Operational Results;
Well Positioned to Meet 2023 Guidance
VANCOUVER, BC - Eldorado Gold Corporation (“Eldorado” or “the Company”) today reports the Company’s
financial and operational results for the second quarter of 2023. For further information, please see the Company’s
Consolidated Financial Statements and Management’s Discussion and Analysis ("MD&A") filed on SEDAR+ at
www.sedarplus.com under the Company’s profile.
Second Quarter 2023 Highlights
Operations
• Gold production: 109,435 ounces, compared to 113,462 ounces in Q2 2022, a 4% decrease from Q2 2022
as a result of lower throughput at Lamaque due to the wildfires in the region and lower average gold grade
and recoveries at Olympias.
• Gold sales : 110,134 ounces at an average realized gold price per ounce sold 1 of $1,953, compared to
107,631 ounces at an average realized gold price per ounce sold of $1,849 in Q2 2022. Gold sales
increased 2% from Q2 2022 primarily a result of an increase in production at Kisladag.
• Production costs: $117.0 million, compared to $109.3 million in Q2 2022. The increase was primarily due
to higher royalty expense and increased sales volumes.
• Cash operating costs 1: $791 per ounce gold sold, compared to $ 789 per ounce gold sold in Q2 2022.
Cash operating costs increased from Q2 2022 primarily as a result of lower by-product credits.
• All-in sustaining costs ("AISC")1: $1,296 per ounce sold, compared to $1,270 per ounce sold in Q2 2022,
primarily reflecting the increase in cash operating costs per ounce sold and slightly offset by lower
sustaining capital expenditures.
• Total capital expenditures: $99.4 million, including $42.6 million of growth capital 1 invested at Skouries,
with activity focused on mobilization, procurement and advancement of contracts. Growth capital invested
at the operating mines totalled $29.0 million and was primarily related to Kisladag waste stripping to support
mine life extension and construction of the first phase of the North Heap Leach Pad. Sustaining capital 1
totalled $26.1 million , including $16.2 million at Lamaque for underground development, equipment
rebuilds, and the expansion of the tailing management facility.
• Production and cost outlook: The Company is maintaining its 2023 annual gold production guidance and
cost guidance. Gold production is expected to be 475,000 - 515,000 ounces of gold. Ca sh operating costs
per ounce sold are expected to be $760 t o $860, total operating costs of $860 to $960 per ounce sold and
AISC per ounce sold of $1,190 to $1,290.
Financial
• Revenue: $229.9 million in Q2 2023, an increase of 8% from $213.4 million in Q2 2022, primarily due to
higher sales volumes, and higher average realized gold price.
• Net cash generated from operating activities from continuing operations: $75.3 million compared to
$27.0 million in Q2 2022, primarily as a result of higher gold sales volumes and higher average realized
prices.
1
1 These financial measures or ratios are non-IFRS financial measures or ratios. Certain additional disclosure for non-IFRS financial measures
and ratios have been incorporated by reference and additional detail can be found at the end of this press release and in the section 'Non-IFRS
and Other Financial Measures and Ratios' in the Company's June 30, 2023 MD&A.
• Cash flow from operating activities before changes in working capital 2: $82.4 million in Q2 2023,
compared to $49.2 million in Q2 2022, primarily driven by higher sales volumes, lower finance costs and
lower income taxes paid.
• Cash, cash equivalents and term deposits: $456.6 million , as at June 30, 2023 . Cash increased by
$194.7 million from March 31, 2023, primarily as a result of a strategic equity investment ( $61.3 million) by
the European Bank for Reconstruction and Development ("EBRD") and a bought deal financing ( $101.1
million) that were both completed during the quarter.
• Net earnings (loss): Net earnings of $1.5 million, or $ 0.01 earnings per share, compared to net loss of
$22.9 million or $0.12 loss per share in Q2 2022. Higher net earnings in Q2 2023, compared to Q2 2022, is
primarily a result of higher gold sales, higher average realized gold prices, foreign exchange gain and lower
finance costs.
• Adjusted net earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA") 2:
$106.8 million, compared to $88.5 million in Q2 2022. The increase was primarily driven by increased gold
sales, coupled with lower finance costs.
• Adjusted net earnings (loss) 2: $16.1 million or $ 0.09 earnings per share, compared to net earnings of
$13.6 million or $0.07 earnings per share in Q2 2022. Adjusted net earnings in Q2 2023 added back a non-
cash loss of $21.4 million on foreign exchange translation of deferred tax balances and removed a non-
cash $8.4 million gain on derivative instruments, primarily on gold collars entered into during this quarter.
• Free cash flow 2: Negative $21.7 million compared to negative $62.7 million in Q2 2022. Free cash flow
excluding Skouries was $13.2 million compared to negative $56.9 million in Q2 2022, with the stronger
figure this quarter due primarily to both higher sales volumes and realized gold price as well as lower tax
installments and temporary working capital movements.
• Project Facility Drawdowns: Drawdowns on the Skouries Term Facility for Q2 2023 totalled €65.9 million,
including the previously reported initial drawdown of €32.3 million in April 2023.
Corporate
• Strategic Investment by the EBRD: On June 14, 2023, Eldorado completed a strategic investment of CDN
$81.5 million ( $61.3 million ) by the EBRD. In June the funds were invested in the Skouries project in
Northern Greece, and were credited against the Company’s 20% equity funding commitment per the terms
of the project financing facility that closed on April 5, 2023.
• Bought Deal: On June 7, 2023, the Company completed a bought deal offering for gross proceeds of CDN
$135.2 million ($101.1 million). Proceeds from the offering are expected to be used to fund growth initiatives
across Eldorado's portfolio, including some not currently contemplated within the Company's five-year plan,
as well as for general corporate and working capital purposes.
• Gold Collar Contracts: In May 2023, Eldorado entered into a series of zero-cost gold collar contracts in
order to manage potential cash flow variability during the Skouries construction period.
• Sustainability: On May 31, 2023, the Company published the 2022 Sustainability Report, its 11 th annual
report, detailing our environmental, social and governance performance.
• Appointed Vice President, Legal: On July 24, 2023, Tamiko Ohta was appointed as Vice President, Legal.
Skouries Highlights
• As at June 30, 2023, detailed engineering is 48% complete and procurement is 62% complete.
• Growth capital invested of $42.6 million in Q2 2023, expected total investment of $240-$260 million in 2023.
• Mobilized the first major earthwork initiative for construction of the haul roads to build earthworks structures.
• Commenced structural steel and cladding of process plant and foundation construction of primary crusher.
• On track for commissioning in mid-2025 and commercial production at the end of 2025.
Transitioned to full construction in Q2 2023 with finalization of the project financing. Capital investment in Q2 2023
continued to focus on early construction works, engineering and procurement. Underground development advanced
the west decline while mobilization occurred related to the first major earthwork initiative for construction haul roads
to build earthworks structures. Upcoming milestones in 2023 include the mobilization of major construction contracts
for concrete, finalizing the awards of the remaining major procurement and contract packages to 90% completion,
and advancing detailed engineering to 90% completion.
2
2 These financial measures or ratios are non-IFRS financial measures or ratios. Certain additional disclosure for non-IFRS financial measures
and ratios have been incorporated by reference and additional detail can be found at the end of this press release and in the section 'Non-IFRS
and Other Financial Measures and Ratios' in the Company's June 30, 2023 MD&A.
“During the quarter, both Kisladag and Lamaque demonstrated resiliency in the face of extraordinary weather-
related events,” said George Burns, Eldorado Gold’s President and CEO. “Starting in late May, wildfires in the Abitibi
region impacted operations at Lamaque. The safety of our employees and contractors is our top priority and a
number of shifts were suspended. Our team took the opportunity to re-sequence the maintenance schedule and
devised an alternative route to safely get employees to the Triangle underground that has resulted in minimal impact
to expected production for the year. During the month of May at Kisladag, the region experienced heavy rainfall, and
despite the impact, the team safely delivered on its key milestones during the quarter which included successfully
completing the commissioning of the new agglomeration circuit and rotating the high-pressure grinding rolls for the
first time.”
“At Olympias, I am pleased to report that the team delivered on a number of key productivity initiatives including
implementing ventilation on demand and bulk emulsion blasting during the quarter,” continued Burns. “Further, the
substation is now energized, and in early July, the ventilation fans were able to start, which is expected to not only
improve our energy efficiency and health and safety of our employees, but also increase the number of
development headings we can effectively work in. I see this as the inflection point that we have been working
towards over the past several years through our transformation efforts, which we expect will give us the ability to
drive increased tonnage and production going forward. During the quarter, as we worked to finalize the
implementation of these initiatives at Olympias which were expected earlier in the year, our mine sequencing was
impacted which resulted in lower grades impacting gold and by-product production. That, in combination with lower
realized zinc by-product prices and higher treatment charges, resulted in much higher all-in sustaining costs. We
expect these costs to trend downwards as we realize the benefits of our productivity initiatives and sequence back
into higher grade stopes in the second half of the year, consistent with our 2023 Olympias guidance.”
“In sustainability, Eldorado released its 11th Annual Sustainability Report in late May highlighting our environmental,
social and governance performance over the past year,” said Burns. “Further, our team in Greece completed their
first verification against the Mining Association of Canada’s ‘Towards Sustainable Mining’ protocols. They achieved
“Triple A” ratings across all indicators for Tailings Management and Biodiversity, underlining our commitment to
responsible mining practices. At Lamaque, despite the wildfires, we took delivery of our first electric underground
haul truck, marking the first of its kind in Quebec. Once fully operational, we expect electric trucks at Lamaque to
both mitigate our GHG emissions and support lower operating costs due to anticipated productivity improvements.”
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Consolidated Financial and Operational Highlights
3 months ended June 30, 6 months ended June 30,
Continuing operations (4) 2023 2022 2023 2022
Revenue $229.9 $213.4 $459.2 $408.1
Gold produced (oz) (5) 109,435 113,462 220,944 206,671
Gold sold (oz) 110,134 107,631 219,951 202,103
Average realized gold price ($/oz sold) (2) $1,953 $1,849 $1,943 $1,868
Production costs (5) 117.0 109.3 228.2 213.9
Cash operating costs ($/oz sold) (2,3,5) 791 789 784 810
Total cash costs ($/oz sold) (2,3,5) 928 879 893 908
All-in sustaining costs ($/oz sold) (2,3,5) 1,296 1,270 1,252 1,306
Net earnings (loss) for the period (1,5) 0.9 (25.3) 20.2 (342.9)
Net earnings (loss) per share – basic ($/share) (1,5) 0.00 (0.14) 0.11 (1.88)
Net earnings (loss) per share – diluted ($/share) (1,5) 0.00 (0.14) 0.11 (1.88)
Net earnings (loss) for the period continuing operations (1,5) 1.5 (22.9) 20.9 (62.6)
Net earnings (loss) per share continuing operations – basic ($/share)(1,4,5) 0.01 (0.12) 0.11 (0.34)
Net earnings (loss) per share continuing operations – diluted ($/share)(1,4,5) 0.01 (0.12) 0.11 (0.34)
Adjusted net earnings (loss) continuing operations - basic (1,2,4,5) 16.1 13.6 34.6 (5.7)
Adjusted net earnings (loss) per share continuing operations ($/share)(1,2,4,5) 0.09 0.07 0.19 (0.03)
Net cash generated from operating activities 75.3 27.0 115.6 62.3
Cash flow from operating activities before changes in working capital (2,5) 82.4 49.2 175.6 98.5
Free cash flow (2) (21.7) (62.7) (56.7) (89.5)
Free cash flow excluding Skouries (2) 13.2 (56.9) (6.7) (79.1)
Cash, cash equivalents and term deposits 456.6 370.0 456.6 370.0
Total assets 4,742.1 4,504.8 4,742.1 4,504.8
Debt 546.0 497.2 546.0 497.2
(1) Attributable to shareholders of the Company.
(2) These financial measures or ratios are non-IFRS financial measures or ratios. See the section 'Non-IFRS and Other Financial Measures and Ratios' of
our MD&A for explanations and discussions of these non-IFRS financial measures or ratios.
(3) Revenues from silver, lead and zinc sales are off-set against cash operating costs.
(4) Amounts presented for 2023 and 2022 are from continuing operations only and exclude the Romania segment. See Note 4 of our condensed
consolidated interim financial statements for the three and six months ended June 30, 2023.
(5) A concentrate weight-scale calibration correction at Olympias has resulted in an adjustment to ending inventory as at March 31, 2023 of 1,024 gold
ounces. Gold production in Q1 2023 has been reduced by this amount, resulting in additional production costs of $1.3 million and additional depreciation
expense of $0.7 million for Q1 2023.
Total revenue was $229.9 million in Q2 2023 , an increase of 8% from $213.4 million in Q2 2022 and was
comparable to $229.4 million earned in Q1 2023 . Total revenue was $459.2 million in the six months ended
June 30, 2023, an increase from $408.1 million in the six months ended June 30, 2022. The increases in both three
and six-month periods were primarily due to higher sales volumes, and higher average realized gold price.
Production costs increased to $117.0 million in Q2 2023 from $109.3 million in Q2 2022 and to $228.2 million in the
six months ended June 30, 2023 from $213.9 million in the six months ended June 30, 2022 . Increases in both
periods were primarily due to higher royalty expense and increased sales volumes.
Cash operating costs averaged $791 per ounce sold in Q2 2023, an increase from $789 in Q2 2022 , which is
primarily due to lower by-product credits. Cash operating costs per ounce sold averaged $784 in the six months
ended June 30, 2023, a decrease from $810 in the six months ended June 30, 2022, primarily due to an increase in
volume sold.
AISC per ounce sold averaged $1,296 in Q2 2023 , an increase from $1,270 in Q2 2022 , due to increases in
royalties and G&A costs per ounce sold, partially offset by lower sustaining capital expenditures. AISC per ounce
sold averaged $1,252 in the six months ended June 30, 2023 , a decrease from $1,306 in the six months ended
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June 30, 2022, primarily reflecting the decrease in cash operating costs per ounce sold and lower sustaining capital
expenditures.
We reported net earnings attributable to shareholders from continuing operations of $1.5 million ($0.01 earnings per
share) in Q2 2023 compared to net loss of $22.9 million ($0.12 loss per share) in Q2 2022 and net earnings of
$20.9 million ($0.11 earnings per share) in the six months ended June 30, 2023 compared to net loss of $62.6
million ( $0.34 loss per share) in the six months ended June 30, 2022 . The higher net earnings this quarter,
compared to Q2 2022, was driven by gains on both derivative instruments and foreign exchange, partially offset by
higher income tax expense. The higher net earnings in the six months ended June 30, 2023 was primarily due to
higher operating income from the increase in gold sales, lower mine standby costs and writedown of assets, gains
on derivatives and foreign exchange, and lower income tax expense.
Adjusted net earnings was $16.1 million ($0.09 earnings per share) in Q2 2023 compared to adjusted net earnings
of $13.6 million ($0.07 per share) in Q2 2022. Adjusted net earnings in Q2 2023 removed a $8.4 million gain on
derivative instruments, primarily on gold collars entered into during this quarter, while adjusted net earnings in Q2
2022 added back a $14.4 million loss on redemption option derivative for the senior notes .
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Quarterly Operations Update
3 months ended June 30, 6 months ended June 30,
2023 2022 2023 2022
Consolidated
Ounces produced 109,435 113,462 220,944 206,671
Ounces sold 110,134 107,631 219,951 202,103
Production costs $117.0 $109.3 $228.2 $213.9
Cash operating costs ($/oz sold) (1,2) $791 $789 $784 $810
All-in sustaining costs ($/oz sold) (1,2) $1,296 $1,270 $1,252 $1,306
Sustaining capital expenditures (2) $26.1 $32.3 $52.1 $56.8
Kisladag
Ounces produced 34,180 27,974 71,340 57,753
Ounces sold 32,280 26,881 69,673 56,659
Production costs $27.5 $25.1 $58.0 $55.2
Cash operating costs ($/oz sold) (1,2) $687 $798 $699 $831
All-in sustaining costs ($/oz sold) (1,2) $937 $1,090 $904 $1,087
Sustaining capital expenditures (2) $2.8 $4.3 $5.0 $6.8
Lamaque
Ounces produced 38,745 46,917 76,629 80,294
Ounces sold 39,904 45,655 78,547 79,780
Production costs $28.3 $31.4 $57.5 $58.7
Cash operating costs ($/oz sold) (1,2) $676 $657 $698 $703
All-in sustaining costs ($/oz sold) (1,2) $1,117 $985 $1,166 $1,069
Sustaining capital expenditures (2) $16.2 $13.5 $34.1 $26.5
Efemcukuru
Ounces produced 22,644 22,792 42,572 43,849
Ounces sold 22,466 23,428 42,217 44,810
Production costs $20.4 $20.6 $38.1 $37.5
Cash operating costs ($/oz sold) (1,2) $697 $706 $777 $678
All-in sustaining costs ($/oz sold) (1,2) $1,111 $1,180 $1,103 $1,093
Sustaining capital expenditures (2) $3.7 $5.9 $5.9 $9.4
Olympias
Ounces produced (3) 13,866 15,779 30,403 24,775
Ounces sold 15,484 11,667 29,514 20,854
Production costs (3) $40.8 $32.1 $74.6 $62.4
Cash operating costs ($/oz sold) (1,2,3) $1,439 $1,446 $1,227 $1,447
All-in sustaining costs ($/oz sold) (1,2,3) $2,036 $2,346 $1,797 $2,369
Sustaining capital expenditures (2) $3.4 $8.5 $7.1 $14.1
(1) Revenues from silver, lead and zinc sales are off-set against cash operating costs.
(2) These financial measures or ratios are non-IFRS financial measures or ratios. See the section 'Non-IFRS and Other Financial Measures and Ratios' of our
MD&A for explanations and discussions of these non-IFRS financial measures or ratios.
(3) A concentrate weight-scale calibration correction at Olympias has resulted in an adjustment to ending inventory as at March 31, 2023 of 1,024 gold
ounces. Gold production in Q1 2023 has been reduced by this amount, resulting in additional production costs of $1.3 million and additional depreciation
expense of $0.7 million for Q1 2023.
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Kisladag
Kisladag produced 34,180 ounces of gold in Q2 2023, a 22% increase from 27,974 ounces produced in Q2 2022.
The increase was primarily due to increased tonnes stacked as compared to Q2 2022, despite challenging adverse
weather conditions. Average grade remained consistent at 0.76 grams per tonne during Q2 2023 and Q2 2022.
Tonnes placed on the heap leach pad in the quarter continued to benefit from the installation of larger, higher-
capacity conveyors, improving material handling capacity and belt agglomeration. Improvements in throughput were
also due to the success of a fine ore agglomeration drum added to the crushing circuit and commissioned during the
quarter, which improved materials handling on the conveying system. These initiatives have enabled increased
recoverable ounces placed on the pad.
Extraordinary rainfall through May and early June had marginal impact on tonnage stacked however, the excess
water affects the leach kinetics and results in a higher volume of lower tenor solution to process. It is expected that
this additional solution will be extracted in the third quarter.
Revenue increased to $64.7 million in Q2 2023 from $51.0 million in Q2 2022, reflecting higher sales in the quarter,
and to a lesser extent, an increase in the average realized gold price.
Production costs increased to $27.5 million in Q2 2023 from $25.1 million in Q2 2022 primarily due to an increase in
tonnes processed and ounces sold in line with higher production. Royalty expense was also higher as a result of
higher sales volume and higher average realized gold prices. Compared to prior year, we saw decreases in unit
costs of fuel and electricity in Turkiye, and coupled with higher sales volumes, the resulting cash operating costs per
ounce decreased to $687 in Q2 2023 from $798 in Q2 2022.
Depreciation expense increased to $18.1 million in Q2 2023 from $15.5 million in Q2 2022 in line with higher gold
sales in the quarter and due to the shorter remaining useful life of the existing heap leach pad and adsorption-
desorption and recovery ("ADR") plant.
AISC per ounce sold decreased to $937 in Q2 2023 from $1,090 in Q2 2022, primarily due to the decrease in cash
operating costs per ounce sold and a decrease in sustaining capital expenditures.
Sustaining capital expenditures of $2.8 million in Q2 2023 and $5.0 million in the six months ended June 30, 2023
primarily included equipment rebuilds and mine equipment purchases. Growth capital investments of $18.7 million
and $37.3 million in the three and six months ended June 30, 2023 included waste stripping to support the mine life
extension and construction of the first phase of the North heap leach pad, which was commissioned in July 2023.
For 2023, production guidance at Kisladag is forecasted to be 160,000 to 170,000 ounces of gold. Production is
expected to improve over the course of the second half of the year as we realize full effectiveness from the
upgraded materials handling equipment. Our optimization efforts are expected to drive increased stacking rates. In
addition, we expect to recover the ounces that were delayed as a result of the extraordinary rainfall in May and early
June.
Lamaque
Lamaque produced 38,745 ounces of gold in Q2 2023, a decrease of 17% from 46,917 ounces in Q2 2022. The
decrease was primarily due to lower ore throughput and slightly lower grade. Tonnes processed were reduced as a
result of forest fires in the region which caused poor air quality resulting in a number of suspended shifts in the
Triangle underground in June. The processing facility was able to keep operating on stockpile material and then
brought forward scheduled maintenance from July into June to minimize unplanned downtime . Average grade
decreased to 6.43 grams per tonne in Q2 2023 from 6.63 grams per tonne in Q2 2022. Underground development
of high-grade stopes progressed well during the quarter.
Revenue decreased to $78.6 million in Q2 2023 from $85.0 million in Q2 2022 primarily due to lower ounces sold as
a result of lower production, partially offset by higher average realized gold prices.
Production costs decreased to $28.3 million in Q2 2023 from $31.4 million in Q2 2022, primarily due to lower
volume sold in the quarter. Cash operating costs per ounce sold rose to $676 in Q2 2023 from $657 in Q2 2022 as
a result of lower gold sold, partially offset by cost savings from a weaker Canadian dollar as compared to prior year.
AISC per ounce sold increased to $1,117 in Q2 2023 from $985 in Q2 2022 primarily due to higher cash operating
cost per ounce, lower gold sold, and higher sustaining capital expenditure in the quarter.
Sustaining capital expenditures of $16.2 million in Q2 2023 and $34.1 million in the six months ended June 30, 2023
primarily included underground development, equipment rebuilds, and expansion of the tailings management
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facility. Growth capital investment of $4.9 million in Q2 2023 and $7.6 million in the six months ended June 30, 2023
were primarily related to resource conversion drilling at Ormaque and spending on other exploration projects.
The second half of the year is expected to be stronger as both processing rates and grade increase. In 2023,
production guidance at Lamaque is forecasted to be 170,000 to 180,000 ounces of gold.
Efemcukuru
Efemcukuru produced 22,644 payable ounces of gold in Q2 2023, a 1% decrease from 22,792 payable ounces in
Q2 2022. The decrease was primarily due to a slight decrease in grade to 5.85 grams per tonne in Q2 2023 from
5.96 grams per tonne in Q2 2022. This impact was almost entirely offset by higher throughput in the quarter due to
increased mill availability, further demonstrating consistency in mill utilization.
Revenue increased to $44.1 million in Q2 2023 from $41.4 million in Q2 2022. Lower payable ounces sold was
offset by a higher average realized gold price recorded during Q2 2023.
Production costs decreased slightly to $20.4 million in Q2 2023 from $20.6 million in Q2 2022 primarily due to lower
sales in the quarter and decreasing unit costs of consumables, and partially offset by higher royalty expense due to
higher average realized gold prices. Lower unit costs of fuel and electricity resulted in a decrease in cash operating
costs per ounce sold to $697 in Q2 2023 from $706 in Q2 2022.
AISC per ounce sold decreased to $1,111 in Q2 2023 from $1,180 in Q2 2022. The decrease was primarily due to
the increase in cash operating costs per ounce sold and was partly offset by lower sustaining capital expenditure.
Sustaining capital expenditures of $3.7 million in Q2 2023 and $5.9 million in the six months ended June 30, 2023
were primarily underground development and equipment rebuilds. The development of the Mine Rock Storage
Facility ("MRSF") southern expansion commenced this quarter. Growth capital investment of $3.5 million in the six
months ended June 30, 2023 included capital development, resource conversion drilling at Kokarpinar and resource
expansion at Bati.
Production for the third and fourth quarter are expected to increase slightly over the second quarter as processing
rates increase. For 2023, production guidance at Efemcukuru is forecast to be 80,000 to 90,000 ounces of gold.
Olympias
Olympias produced 13,866 ounces of gold in Q2 2023 , a 12% decrease from 15,779 ounces in Q2 2022 and
primarily reflected lower average gold grade due to changes in stope sequencing in the quarter as we await benefits
of transformation initiatives that were completed in early July. This was partially offset by higher mill throughput that
was achieved this quarter as we continue to ramp up productivity. Q2 2023 production of by-product metals, while
lower than planned, increased as compared to Q2 2022 and Q1 2023 across silver, lead, and zinc as a result of
higher average grades as planned in both the three and six months ended periods as well as higher throughput.
In line with our 2023 guidance, key transformation initiatives are on-going as the mine continues to ramp up
productivity. Bulk emulsion blasting was commissioned in June, which we expect will allow for further efficiencies
underground. Additionally, the newly constructed electrical substation was energized in June and commissioned in
early July, following a successful shutdown to tie-in the expanded ventilation system. Increased ventilation capacity
is expected to support productivity improvements in the lower parts of the mine and increase access to stopes with
higher grades of base metals. These initiatives, while positive, were delayed from planned early Q1 implementation.
These delays are the primary cause for mine plan sequencing and lower mine or Flats Zone development which
have contributed to lower by-product volumes than planned. Stoping sequence and Flats development are expected
to gradually recover over the balance of 2023.
Due to a scale calibration correction that was identified during this quarter, we made a one-time adjustment lowering
Q1 2023 gold production by 1,024 ounces.
Revenue increased to $42.4 million in Q2 2023 from $36.3 million in Q2 2022 primarily as a result of higher gold
sales and higher average realized gold price, which includes the impacts of upward revaluations of provisional
pricing in Q2 2023 due to increases in gold price during the quarter. Sales of base metals were slightly lower in Q2
2023 due to the timing of silver and lead concentrate shipments in early July.
Production costs increased to $40.8 million in Q2 2023 from $32.1 million in Q2 2022 reflecting increased volumes
of gold sales, combined with higher treatment and refining costs from higher zinc sales. Cash operating costs per
ounce sold decreased to $1,439 in Q2 2023 from $1,446 in Q2 2022, with lower mining and operating costs per
ounce sold nearly offset by lower revenue from silver and base metal sales (which reduce cash operating costs as
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