Richmont boosts production

Weak gold prices do not appear to be taking much of a toll on Montreal-based Richmont Mines (RIC-T).

The company posted net earnings of $1.4 million for its latest quarter ended June 30, up from $1 million a year earlier. Revenues reached $12.8 million, compared with $11.4 million for the second quarter of 1997.

The strong performance is being attributed to increased gold production and lower costs at operations in Quebec and Newfoundland. During the 1998 second quarter, gold production reached 24,450 oz. gold at a cash cost of US$192 per oz., compared with 21,600 oz. at a cash cost of US$196 a year earlier.

At the Francoeur mine in Quebec’s Abitibi belt, 41,000 tons grading 0.2 oz.

gold per ton were mined and processed, compared with 49,700 tons of 0.19 oz.

in the 1997 second quarter. Gold production was 8,200 oz. at a cash cost of US$244 per oz., compared with 9,600 oz. at US$260 per oz. a year ago.

At the Nugget Pond gold mine in Newfoundland, which started up in April 1997, 34,500 tons grading 0.34 oz. were mined, resulting in 11,500 oz.

during the second quarter. By comparison, Richmont mined 30,800 tons of 0.4 oz. from Nugget Pond in the second quarter of 1997, representing 12,000 oz.

Cash costs between the two periods fell to US$135 from US$146 per oz.

Included in Richmont’s 1998 results is its share of production from 69.3%-owned Louvem Mines (LOV-T), a small gold producer in Quebec’s Val d’Or camp. Louvem’s Beaufor mine contributed 4,750 oz. gold at a cash cost of US$239 per oz. in the latest quarter.

Richmont reports that its debt has fallen to $5.5 million from $12.4 million a year ago, whereas cash and equivalents have almost doubled, to $15 million from $8.2 million.