OCEANAGOLD REPORTS FIRST QUARTER 2022 FINANCIAL RESULTS Achieves Record EBITDA and Strong Free Cash Flow
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28 April 2022 News Release
OCEANAGOLD REPORTS FIRST QUARTER 2022 FINANCIAL RESULTS
Achieves Record EBITDA and Strong Free Cash Flow
(All financial figures in US Dollars unless otherwise stated)
(BRISBANE) OceanaGold Corporation (TSX: OGC) ( ASX: OGC) (“OceanaGold” or the “Company”) reported
its financial and operational results for the quarter ended March 31, 2022. Details of the consolidated financial
statements and the Management Discussion and Analysis (“MD&A”) are available on the Company’s website
at www.oceanagold.com.
Highlights
• Produced 134,035 ounces of gold, a 26% increase quarter-on-quarter.
• Consolidated All-In Sustaining Costs (“AISC”) for the quarter of $1,084 per ounce on gold sales of 129,191
ounces.
• Record quarterly revenue of $286 million and record quarterly EBITDA of $158 million.
• Net profit after tax of $79 million or $0.11 per share fully diluted.
• Generated $63 million in free cash flow.
• Net debt, inclusive of equipment leases, reduced by 29% quarter on quarter to $168m with a resulting
leverage ratio of 0.40 times and period-end gearing of 9%.
• Haile delivered record quarterly gold production of 60,249 ounces.
• Didipio achieved full underground mining rates in March, and in the quarter produced 29,44 6 ounces of
gold and 3,510 tonnes of copper at first quartile All-In Sustaining Costs of $40 per ounce sold.
• Wharekirauponga (“WKP”) Indicated Resource increased 53% to 1.5 million tonnes (“Mt”) at 13.5 g/t gold
for 0.64 million ounces (“Moz”) gold including 1.27 Moz silver. Inferred Resources of 2.3 Mt at 9.4 g/t gold
for 0.7 Moz of gold including 1.6 Moz of silver, presenting a significant opportunity for further resource
conversion.
• Gerard Bond commenced as President and Chief Executive Officer on April 4, 2022 .
• Reaffirm full year consolidated guidance of 445,000 to 495,000 ounces of gold and 11,000 to 13,000
tonnes of copper, at an AISC of $1,275 to $1,375 and cash costs between $675 to $775 per ounce sold.
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Gerard Bond, President and CEO of OceanaGold, said “OceanaGold has started the year strongly with the first
quarter safely delivering record quarterly revenue and EBITDA and significant Free Cash Flow. This strong Free
Cash Flow generation allowed us to achieve a 29% reduction in net debt and reduce our leverage ratio to 0.40
times. Our stronger balance sheet puts us in a solid financial position from which we can invest in attractive
growth projects to create value for our shareholders.”
“This quarter’s performance was underpinned by record quarterly gold production at our Haile operation in the
United States and a very strong first quarter of full production at our Didipio operations in the Philippines. At
Haile, we are continuing to see the benefits of operational and productivity improvements that began in mid-
2021. At Didipio, the operation achieved full underground mining rates at the end of the first quarter, ahead of
schedule by nearly one quarter.”
“Though there is a lot to celebrate in the quarterly results , we also know that there is a lot of work ahead of us
to fully optimise the potential of the business. At Waihi, poor grade reconciliation at Martha underground had an
impact on its quarterly performance. A grade control drill programme is currently underway to deliver improved
resource definition and allow for more optimal mine planning and stope sequencing , which we expect will
improve the performance of this orebody and mining operation overall.”
“We also have a pipeline of organic growth projects that have the potential to create additional value for
shareholders. Once we commence development of the underground mine at Haile, we believe we will begin to
unlock the true upside potential of this orebody. Looking further ahead, Wharekirauponga (“WKP”) has the
potential to be a significant, high-grade mine within our portfolio.”
“We remain focused on safely and responsibly delivering on our production guidance for 2022, maximising Free
Cash Flow generation and progressing the attractive growth options in our portfolio.” said Mr Bond.
Table 1 – Production and Cost Results Summary
Quarter ended 31 March 2022 Haile Didipio Waihi Macraes
Consolidated
Q1 2022 Q1 2021
Gold Produced koz 60.2 29.4 6.8 37.6 134.0 83.2
Gold Sales koz 54.5 29.8 6.6 38.2 129.2 82.8
Average Gold Price US$/oz 1,910 1,972 1,868 1,887 1,915 1,786
Copper Produced kt - 3.5 - - 3.5 -
Copper Sales kt - 3.7 - - 3.7 -
Average Copper Price US$/lb - 4.89 - - 4.89 -
Material Mined kt 9,613 513 235.8 11,684 22,047 22,622
Waste Mined kt 8,650 28 161.5 9,233 18,072 20,250
Ore Mined kt 964 486 74.3 2,451 3,974 2,372
Mill Feed kt 869 872 73.3 1,461 3,275 1,957
Mill Feed Grade g/t 2.54 1.18 3.08 1.00 1.50 1.57
Gold Recovery % 84.7 89.3 92.9 80.0 84.0 83.9
Cash Costs US$/oz 567 26 1,692 1,005 630 800
Site AISC (1) US$/oz 1,070 40 2,950 1,394 1,084 1,229
(1) Site AISC are exclusive of Corporate general and administrative expenses ., Consolidated AISC is inclusive of Corporate general and administrative
expenses. Cash Costs and All-In Sustaining Costs are reported on ounces sold and net of by -product credits.
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Table 2 – Financial Summary
Quarter ended 31 Mar 2022
(US$m)
Q1
31 Mar 2022
Q4
31 Dec 2021
Q1
31 Mar 2021
Revenue 285.7 208.5 148.9
Cost of sales, excluding depreciation and amortization (114.4) (98.7) (66.7)
General and administration – indirect taxes (2) (4.5) (1.8) (0.1)
General and administration – idle capacity charges (1) - (3.9) (4.5)
General and administration – other (11.1) (15.0) (12.6)
Foreign currency exchange gain/(loss) 1.9 (1.3) (2.4)
Other income/(expense) 0.4 1.0 0.4
EBITDA (excluding impairment expense) 158.0 88.7 62.0
Depreciation and amortization (55.3) (61.6) (36.3)
Net interest expense and finance costs (2.8) (3.4) (2.7)
Earnings before income tax (excluding impairment expense) 99.9 23.8 23.0
Income tax expense on earnings (18.1) (17.7) (5.7)
Earnings after income tax (excluding impairment expense) 81.8 6.1 17.3
Impairment expense (4) - (162.2) -
Tax benefit on impairment expense - 60.1 -
Write off exploration/property expenditure / investment (3) (3.2) - (1.3)
Net Profit/(loss) 78.6 (96.0) 16.0
Basic earnings/(loss) per share $0.11 $(0.14) $0.02
Diluted earnings/(loss) per share $0.11 $(0.14) $0.02
(1) The Company did not record any revenue or cost of sales from the Didipio mine during the quarter ended 31 March 2021. General and Administration –
idle capacity charges reflect the non-production costs related to maintaining Didipio’s operational readiness to 31 October 2021.
(2) Represents production-based taxes in the Philippines, specifically excise tax, local business and property taxes.
(3) There was a write-off of exploration projects in New Zealand as at 31 March 2022.
(4) There was an impairment expense of $241 million recognised related to the Haile Gold mine and a reversal of impairment of $78.8 million related to
Didipio.
Table 3 – Cash Flow Summary
Quarter ended 31 Mar 2022
(US$m)
Q1
31 Mar 2022
Q4
31 Dec 2021
Q1
31 Mar 2021
Cash Flow from Operating Activities 143.8 108.9 47.6
Cash Flows used in Investing Activities (71.9) (79.8) (71.9)
Cash Flow used in Financing Activities (8.7) (6.3) (6.7)
Free Cash Flow 63.2 22.8 (31.0)
Operations
The Company produced 134,035 ounces of gold and 3,510 tonnes of copper in the first quarter of 2022,
representing a 26% increase in gold production compared to the previous quarter and a 61% increase when
compared to the first quarter of 2021. The stronger quarterly production was driven by record quarterly
production at Haile and a solid quarter of production at Didipio, partially offset by decreased production at Waihi.
On a consolidated basis, the Company recorded an AISC of $1,084 per ounce on gold sales of 129,191 ounces
and copper sales of 3,711 tonnes. AISC was 18% lower quarter-on-quarter with the benefits from a full quarter
of operations at Didipio partially offset by increased sustaining capital investments. The Company’s AISC
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decreased 14% when compared to the first quarter of 2021, also due primarily to the inclusion of a full quarter
of operations at Didipio.
Haile delivered 60,249 ounces of gold, representing a record quarter for production. This represents an increase
of 42% quarter -on-quarter and was mainly driven by increased mill feed, higher head grade and better gold
recoveries. Year-on-year, this represents a 36% increase in production, resulting from higher mill feed, grade,
and recovery. The higher grades were driven by ore sourced f rom Ledbetter Phase 1. First quarter AISC at
Haile was $1,070 and cash costs were $567 per ounce sold.
The Company expects the Supplemental Environmental Impact Statement (‘SEIS’) Final Record of Decision
and receipt of subsequent operating permits to occur in the second quarter of 2022. The permits are necessary
to allow underground mine development and expansion of the operating footprint to accommodate the
construction of future PAG waste storage facilities and to allow increased water discharge rates. A s previously
guided, the ongoing delay in the receipt of the SEIS decision and associated permits continues to impact
productivity at Haile, where mining rates are limited by additional material and water re-handling, reducing output
and increasing costs. Upon receipt of the necessary permits, the Company expects an improvement in
operational efficiencies and lower mining unit costs to be delivered progressively over a two -year period. An
updated National Instrument (“NI”) 43-101 Technical Report for Haile was released 31 March 2022. The recently
completed technical review assumed receipt of the necessary permits related to the SEIS by the end of the
second quarter of 2022.
Didipio produced 29,446 ounces of gold and 3,510 tonnes of copper, reflecting a 98% increase in gold
production and 51% increase in copper production quarter -on-quarter. This represents the first full quarter of
operations since the restart of production in November 2021. The underground mine achieved full mining rates
at the end of the first quarter, ahead of schedule. Didipio’s first quarter AISC and cash costs were $40 per ounce
sold and $26 per ounce sold respectively. An updated NI 43 -101 Technical Report for Didipio was released 31
March 2022.
Macraes produced 37,58 8 ounces of gold in the first quarter, a slight increase quarter -on-quarter and a 9%
increase from the first quarter of 2021. Relative to the prior quarter, production increased on higher average
head grade that was partially offset by lower mill feed and reduced gold recoveries. Macraes’ first quarter AISC
and cash costs were $1,394 and $1,005 per ounce sold respectively.
Waihi produced 6,752 ounces of gold in the first quarter, 43% lower quarter -on-quarter and 56% higher than
the first quarter of 2021. The quarter-on-quarter decrease in production was attributed to lower ore tonnes and
grade mined from Martha Underground, where mining was in areas of the resource with low resource definition
and under-reconciled to the resource model in both grade and tonnes of ore. The Company estimates the under
reconciliation accounted for approximately half of the negative impact during the quarter, with poor ground
conditions in parts of the orebody and reduced workforce availability due to COVID -19 isolations also
contributing factors. Results from the accelerated grade control drill program continued to update the resource
models currently being used for mine planning. Grade control drilling to support mining for the remainder of
2022 and 2023 is expected to be compl eted progressively across the second and third quarters of 2022. This
program is expected to better inform the detailed mine planning and design process, optimise the stoping
sequence, reduce ore loss and deliver improved performance.
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Preparation for the lodgement of a consent application for the Waihi North Project, inclusive of WKP, continued
to progress with environmental assessments nearing completion. The Company expects to lodge its formal
consenting application, inclusive of stakeholder feedback, in the second quarter of 2022. The critical path for
first production from the Waihi North Project remains the consenting process.
Financial
The Company reported record quarterly revenue of $285.7 million, reflecting a 37% increase quarter-on-quarter.
The Company reported record quarterly EBITDA in the first quarter of $158 million, reflecting a 78% increase
quarter-on-quarter on stronger gold sales volumes from Haile, Didipio and Macraes and higher average gold
and copper prices received and lower unit cost s, partially offset by lower sales at Waihi. First quarter 2022
EBITDA was 155% higher than the first quarter of 2021 related to resumption of operations at Didipio and
increased gold prices.
First quarter 2022 adjusted earnings after tax were $81.8 million or $0.11 per share which compared to $29.3
million in the fourth quarter of 2021 and $17.3 million in the first quarter of 2021.
Cash flows from operating activities for the first quarter of $143.8 million exceeded the comparative quarters,
driven by stronger EBITDA though partially offset by unfavourable working capital movements . Operating cash
flow per share before working capital movements was $0.22 in the first quarter.
The Company generated $63.2 million in free cash flow during the first quarter. As at the end of the first quarter
Net Debt including equipment leases was $168.4m, which was $69.5m or 29% lower than at the end of
December 2021. The Company had immediately available liquidity of $224.7 million, including $194.7 million in
cash.
Conference Call
The Company will host a conference call / webcast to discuss the first quarter results at 7:30 am on Friday April
29, 2022 (Australian Eastern Standard Time) / 5:30 pm on Thursday April 28, 2022 (Toronto, Eastern Daylight
Time).
Webcast Participants
To register, please copy and paste the link below into your browser:
https://produceredition.webcasts.com/starthere.jsp?ei=1539065&tp_key=bc1166f656
Teleconference Participants
Local (toll free) dial in numbers are:
Canada & North America: 1 888 390 0546
Australia: 1 800 076 068
New Zealand: 0 800 453 421
United Kingdom: 0 800 652 2435
Switzerland: 0 800 312 635
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All other countries (toll): + 1 416 764 8688
Playback of Webcast
If you are unable to attend the call, a recording will be available for viewing on the Company’s website.
- ENDS -
Authorised for release to the market by Company Secretary, Liang Tang.
For further information please contact:
Investor Relations Media Relations
Sabina Srubiski
Tel: +1 604 351 7909
Melissa Bowerman
Tel: +61 407 783 270
www.oceanagold.com | Twitter: @OceanaGold
About OceanaGold
OceanaGold is a multinational gold producer committed to the highest standards of technical, environmental
and social performance. For 3 1 years, we have been contributing to e xcellence in our industry by delivering
sustainable environmental and social outcomes for our communities, and strong returns for our shareholders.
Our global exploration, development, and operating experience has created an industry -leading pipeline of
organic growth opportunities and a portfolio of established operating assets including Didipio Mine in the
Philippines; Macraes and Waihi operations in New Zealand; and Haile Gold Mine in the United States of
America.
Technical Disclosure
All Mineral Reserve s and Mineral Resources have been calculated and prepared in accordance with the
standards set out in the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves dated December 2012 (the “JORC Code”) and in accordance wit h National Instrument 43-101 of the
Canadian Securities Administrators (“NI 43 -101”). The JORC Code is the accepted reporting standard for the
Australian Stock Exchange Limited (“ASX”).
Mineral Resources for Waihi’s Wharekirauponga Underground have been re viewed and approved by J Moore,
who is an employee of OceanaGold Corporation, and is a “qualified person” for the purposes of NI 43-101. Mr
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Moore has sufficient experience relevant to the style of mineralisation and type of deposit under consideration
and to the activity which they are undertaking to qualify as a “competent person” as defined in the JORC Code.
Cautionary Statement for Public Release
Certain information contained in this public release may be deemed “forward -looking” within the meaning of
applicable securities laws. Forward-looking statements and information relate to future performance and reflect
the Company’s expectations regarding the generation of free cash flow, execution of business strategy, future
growth, future production, estimated costs, results of operations, business prospects and opportunities of
OceanaGold Corporation and its related subsidiaries. Any statements that exp ress or involve discussions with
respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or
performance (often, but not always, using words or phrases such as "expects" or "does not expect", "is
expected", "anticipates" or "does not anticipate", "plans", "estimates" or "intends", or stating that certain actions,
events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved) are not statements of
historical fact and may be forw ard-looking statements. Forward -looking statements are subject to a variety of
risks and uncertainties which could cause actual events or results to differ materially from those expressed in
the forward-looking statements and information. They include, amo ng others, the accuracy of mineral reserve
and resource estimates and related assumptions, inherent operating risks and those risk factors identified in the
Company’s most recent Annual Information Form prepared and filed with securities regulators which is available
on SEDAR at www.sedar.com under the Company’s name. There are no assurances the Company can fulfil
forward-looking statements and information. Such forward -looking statements and information are only
predictions based on current information ava ilable to management as of the date that such predictions are
made; actual events or results may differ materially as a result of risks facing the Company, some of which are
beyond the Company's control. Although the Company believes that any forward -looking statements and
information contained in this press release is based on reasonable assumptions, readers cannot be assured
that actual outcomes or results will be consistent with such statements. Accordingly, readers should not place
undue reliance on forward-looking statements and information. The Company expressly disclaims any intention
or obligation to update or revise any forward -looking statements and information, whether as a result of new
information, events or otherwise, except as required by applicable securities laws. The information contained in
this release is not investment or financial product advice.
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