U.S. Report Pegasus income down as gold output rises

Despite higher gold production from six mines in the western U.S., Pegasus Gold’s (TSE) first-quarter earnings and revenues were down from last year’s levels. Pegasus Gold reported net income of $621,000 or 3 cents per share for the quarter ended March 31, compared with $1.76 million or 7 cents per share in the same period last year.

First-quarter revenues dropped to $29.8 million from $30.4 million in the 1989 quarter.

Contributing to the drop in earnings was the gold price realized by Pegasus during the first three months of this year compared with last year. It dropped to US$414 per oz. from $416. “Higher exploration expenditures and lower interest income also reduced earnings by $1.4 million,” said John Willson, president and chief executive officer.

However, due largely to record output at the Florida Canyon mine near Winnemucca, Nev., first- quarter gold production rose to 56,100 oz. from 51,200 during the equivalent 1989 period. Cash cost of production, in contrast, declined to US$234 from US$240 per oz.

The largest producer in Pegasus Gold’s portfolio of mines, Florida Canyon churned out 23,100 oz. of the yellow metal, compared with 19,200 oz. last year. Levels of silver, lead and zinc production from all six mines were about the same as last year.006 0508,0206,0304,0008 Pegasus Gold (TSE) $000s except per-share items Quarter ended Mar. 31 1990 1989 Revenue $29,826 $30,422 Net earnings 621 1,768

per share 0.03 0.07004