Wesdome Announces 2017 Fourth Quarter and Full Year Financial Results  

TORONTO, March 21, 2018 (GLOBE NEWSWIRE) -- Wesdome Gold Mines Ltd. (TSX:WDO) (“Wesdome” or the “Company”) today announces fourth quarter (“Q4 2017”) and full year 2017 financial results. All figures are stated in Canadian dollars unless otherwise noted.

Mr. Duncan Middlemiss, President and CEO commented, “Our 2017 results exhibit several operational and financial improvements at Wesdome. We slightly exceeded the upper end of our production guidance, mined significantly higher head grades, improved profits, and met the mid-point for our cash cost and all-in sustaining cost guidance. Looking ahead, we expect this trend to continue with 2018 costs to decrease a further 10% and gold production to increase by approximately 10% to 62,000 – 68,000 ounces as per our guidance.”

“In 2018 at the Eagle River Complex, we are committing all exploration efforts to the Eagle River Underground Mine, where reserves currently stand at 416,000 ounces at 12.2 grams per tonne. A main goal of this program is to identify additional mineralization along the eastern extension of the 300 and 7 zone parallel structures, located to the north and parallel to the main 8 zone, to create additional workplaces and thereby realize our objective of providing additional high grade ore to the mill. We are beginning a higher grade mining cycle at this operation that should continue for the foreseeable future.”

“At Kiena, the exploration ramp is nearing completion and last week we resumed drilling, with two drills on the higher grade Zone A and Upper Quartz Zone of the Kiena Deep discovery. A third drill is expected to be added in April to this area. The plan at Kiena this year is to complete 50,000 metres of underground drilling, in order to be in a position to generate a potential resource calculation on the Kiena Deep discovery. This will determine timing and next steps at this asset.”   

Key operating and financial highlights of the full year 2017 results include:

• Gold production of 58,980 ounces from the Eagle River Complex,  a 24% increase over the previous year (2016: 47,737 ounces):

• Eagle River Underground 157,250 tonnes at a head grade of 10.6 grams per tonne (“g/t Au”) for 50,996 ounces produced, a 27% increase over the previous year (2016: 40,252 ounces).

• Mishi Open Pit 152,591 tonnes at a head grade of 2.0 g/t Au for 7,985 ounces produced, a 7% increase over the previous year (2016: 7,485 ounces).

• Revenue of $96.1 million, a 14% increase over the previous year (2016: $84.0 million).

• Ounces sold 57,770 at an average sales price of $1,643/oz (2016: 48,680 ounces at an average price of $1,676/oz).

• Cash costs¹ of $1,097/oz or US$845/oz, a 10% decrease over the previous year (2016: $1,218/oz or US$919/oz). 

• All-in sustaining costs (“AISC”) ¹ of $1,489/oz or US$1,146/oz, a 12% decrease over the previous year (2016: $1,681/oz or US$1,268/oz).

• Earned mine profit¹ of $31.5 million, a 41% increase over the previous year (2016 - $22.3 million).

• Operating cash flow of $27.2 million or $0.20 per share¹   a 21% increase over the previous year (2016: $22.4 million or $0.18 per share).

• Free cash outflow of $9.3 million or ($0.07) per share¹ (2016: outflow of $4.2 million or ($0.03) per share). 

• Net income of $1.3 million or $0.01 per share (2016: $7.8 million or $0.06 per share).  Net income (adjusted) ¹ before a one-time deferred mining tax adjustment of $3.9 million and a non-recurring $2.2 million restructuring cost was $6.8 million or $0.05 per share.

• Cash position of $22.1 million.

• Wesdome been approved by the Ontario Ministry of Northern Development and Mines (“MNDM”) for an entry into the Northern Industrial Electricity Rate (“NIER”) program.  Upon acceptance by MNDM, the Company is qualified for a retroactive electricity cost rebate to the extent of approximately $1.0 million for the period of April 1, 2017 and up to December 31, 2017.

• Mineral Reserves at the Eagle River Underground Mine of 416,000 contained gold ounces (1.1 million tonnes at 12.2 g/t Au) (2016 1.2 million tonnes at 9.2 g/t Au for 344,000 ounces).

             
Key operating and financial highlights of Q4 2017 results include:

• Eagle River Complex gold production of 15,797 ounces (2016: 11,887 ozs).

•19,351 gold ounces sold (2016: 13,490 ozs).

• Cash costs¹ of $1,019/oz (US$801/oz) (2016: $1,215/oz or US$911/oz). 

• AISC¹ of $1,284/oz or US$1,010/oz (Q4 2106: $1,631/oz or US$1,222/oz).

• Earned mine profit¹ of $11.6 million (Q4 2016: $5.9 million).

• Operating cash flow of $13.5 million or $0.10 per share¹ (Q4 2016: $7.7 million or $0.06 per share).

• Free cash flow generation of $5.7 million or $0.04 per share ¹ (Q4 2016: out flow of $2.2 million or ($0.02) per share).

• Net loss of $0.6 million or nil, on a per share basis.  Net income (adjusted)¹ before the one-time mining tax adjustment was $3.4 million or $0.03 per share.

1. Refer to the Company’s 2017 Annual Management Discussion and Analysis on pages 26 – 31, entitled “Non-IFRS Performance Measures” for the reconciliation of these non-IFRS measurements to the financial statements.

Technical Disclosure

The technical content of this release has been compiled, reviewed and approved by Marc-Andre Pelletier, P. Eng, Chief Operating Officer, and Michael Michaud, P.Geo., Vice President, Exploration of the Company and each a "Qualified Person" as defined in National Instrument 43-101 -Standards of Disclosure for Mineral Projects.

Cautionary Note to United States Investors Concerning Estimates of Reserves and Resources

The mineral reserve and resource estimates reported in this news release were prepared in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) as required by Canadian securities regulatory authorities. The United States Securities and Exchange Commission (the “SEC”) applies different standards in order to classify and report mineralization. This news release uses the terms “measured”, “indicated” and “inferred” mineral resources, as required by NI 43-101. Readers are advised that although such terms are recognized and required by Canadian securities regulations, the SEC does not recognize such terms. Canadian standards differ significantly from the requirements of the SEC. Readers are cautioned not to assume that any part or all of the mineral deposits in these categories constitute or will ever be converted into mineral reserves. In addition, “inferred” mineral resources have a great amount of uncertainty as to their existence and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource exists, is economically or legally mineable or will ever be upgraded to a higher category of mineral resource.

Wesdome Gold Mines 2017 Fourth Quarter and Full Year Financial Results Conference Call:

North American Toll Free: + 1 (844) 202-7109
International Dial-In Number: +1 (703) 639-1272
Conference ID:   8836599
Webcast link: https://edge.media-server.com/m6/p/cjgs5kz3

Webcast can also be accessed under the News and Events section of the Company’s website (www.wesdome.com) 

 Notes

1. Refer to the Company’s 2017 Annual Management Discussion and Analysis on pages 26 – 31, entitled “Non-IFRS Performance Measures” for the reconciliation of these non-IFRS measurements to the financial statements.
2. Totals for tonnage and gold ounces information may not add due to rounding.

ABOUT WESDOME

Wesdome Gold Mines is in its 31st year of continuous gold mining operations in Canada. The Company is 100% Canadian focused with a pipeline of projects in various stages of development. The Eagle River Complex near Wawa, Ontario is currently producing gold from two mines, the Eagle River Underground Mine and the Mishi Open pit, from a central mill. Wesdome is actively exploring its brownfields asset, the Kiena Complex in Val d’Or, Quebec. The Company has further upside at its Moss Lake gold deposit, located 100 kilometres west of Thunder Bay, Ontario. The Company has approximately 134 million shares issued and outstanding and trades on the Toronto Stock Exchange under the symbol “WDO.”

For further information, please contact:

Duncan Middlemiss
President and CEO
416-360-3743  ext. 29
dmiddlemiss@wesdome.com

or

Lindsay Carpenter Dunlop
VP Investor Relations
416-360-3743   ext. 25
ldunlop@wesdome.com 

8 King St. East, Suite 811
Toronto, ON, M5C 1B5
Toll Free: 1-866-4-WDO-TSX
Phone: 416-360-3743, Fax: 416-360-7620
Website: www.wesdome.com

This news release contains “forward-looking information” which may include, but is not limited to, statements with respect to the future financial or operating performance of the Company and its projects. Often, but not always, forward-looking statements can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, or “believes” or variations (including negative variations) of such words and phrases, or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, 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 the forward-looking statements. Forward-looking statements contained herein are made as of the date of this press release and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update forward-looking statements if circumstances, management’s estimates or opinions should change, except as required by securities legislation. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements. The Company has included in this news release certain non-IFRS performance measures, including, but not limited to, mine operating profit, mining and processing costs and cash costs. Cash costs per ounce reflect actual mine operating costs incurred during the fiscal period divided by the number of ounces produced.  These measures are not defined under IFRS and therefore should not be considered in isolation or as an alternative to or more meaningful than, net income (loss) or cash flow from operating activities as determined in accordance with IFRS as an indicator of our financial performance or liquidity. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company's performance and ability to generate cash flow.