River Gold Mines (RIV-T) has posted a $1.9-million loss (or 6 per share) for the first three months of 2001, thanks to lower gold prices and higher fuel prices.
In the same period of 2000, the company lost $567,000, (2 per share). Revenue between the periods fell to $7.9 million from $9.1 million.
The company’s flagship Eagle River mine in Ontario cranked out 19,500 oz. gold at a cash cost of US$253 per oz, compared with the 21,200 oz. produced a year earlier at US$234 per oz. Lower-than expected grades, heavy snowfall and higher fuel costs hurt the mine’s output and costs. The company realized a price of US$264 per oz. for its production, down from US$291 per oz. a year earlier.
The sinking of a new production shaft at Eagle River has passed the 390-metre level, and the shaft is slated to hit the target depth of 505 metres by year-end. The company expects the shaft to generate significant savings, compared with the current ramp system.
At the end of March, the company had 122,000 tonnes of broken ore stockpiled. The company has begun treating higher-grade ore from the 6 zone. Production estimates for 2001 remain at 87,000 oz.
On March 31, River Gold had a working capital deficiency of $4.4 million but the company is preparing a rights offering to improve this situation.
At the end of March, the company had $3 million in cash and equivalents and 31.2 million shares outstanding.
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