Aris earnings rise on gold price as output falls at Colombia mines, annual results show

Adjusted earnings for Aris Mining (TSX: ARIS; NYSE: ARMN) gained slightly last year over 2023 even though total gold output at its two mines in Colombia fell by almost the same amount.

Those earnings rose 7% to about $56 million (C$80.5 million) for the year, while gold production at the Marmato and Segovia mines fell 6.7% to 210,955 oz., Aris reported Wednesday in its 2024 results.

Last year’s fourth quarter stood out for Aris with its highest gold output of 2024 at 57,364 oz. and best adjusted earnings at $24.7 million, CEO Neil Woodyer noted in a release.

In northwestern Colombia at the Segovia mine, where the company’s expanding operations, Aris hit a three-year high in its all-in sustaining cost (AISC) margin of $58.3 million, Woodyer added. That represents one-third more than in last year’s Q3 due to improved efficiency and cost control, or a reduction of its AISC to $1,485 per oz. sold last year.

“We remain on track to commission the expanded processing facility at Segovia in (the second quarter of) 2025 with the installation of the second ball mill currently underway,” he said.

Gold prices, which gained about 28% last year helped drive the AISC cost margin higher each quarter. The yellow metal has continued its climb and on Friday morning the spot price touched a milestone of $3,004.71 per ounce.

Costs as expected

In general, costs at Segovia were in line with expectations, BMO Capital Markets analyst Brian Quast wrote in a note on Thursday.

Cash costs of US$1,199 per oz. and AISC of US$1,485 per oz. were comparable to Quast’s US$1,222 per oz. and US$1,518 per oz., he said.

The company’s adjusted earnings-per-share of US14¢ apiece were 1¢ above the analyst’s estimate, however it missed consensus expectations of US17¢ per share.

At Segovia, a 7% increase in the average processing grade to 9.84 grams gold per tonne in the fourth quarter helped push an 8% rise in gold production compared to the third quarter, Aris said.

AISC costs fell 4.5% to US$1,386 per oz. in the fourth quarter from the third. 

Ongoing mine expansions

Meanwhile, the expansion project at Segovia aims to boost processing capacity to 3,000 tonnes per day (tpd) from 2,000 tpd, and is on schedule, with the first stage now complete, Aris said. Installation of a second ball mill in stage two is under way, and commissioning is expected in the second quarter. A ramp-up period to reach a production rate of 3,000 tpd is anticipated by year’s end.

The expansion plant cost is estimated at $15 million, of which $8.5 million was spent as of Dec. 31.

Aris also plans to expand Marmato to raise its capacity to more than 200,000 oz. of gold per year. That includes completion of the Lower Marmato mine, which is to boost throughput by 25% to 5,000 tpd. The total cost of Marmato’s expansion is estimated at $365 million. First gold is anticipated by the end of the year.

Expansions at both mines are to help reach an annual production rate of more than 500,000 oz., Aris said.

Company shares were down 0.7% to C$6.31 apiece on Friday afternoon in Toronto, giving the company a market capitalization of C$1 billion. Its shares traded in a 52-week range of C$4.31 to C$6.97.