New Gold(US:NGD)2025-10-29 13:30Financial Data and Key Metrics Changes - The third quarter revenue was $463 million, higher than the prior year quarter due to increased gold and copper prices and sales volumes [16] - Cash generated from operations before working capital adjustments was $296 million, or $0.37 per share, higher than the prior year period primarily due to higher revenues [16] - The company recorded net earnings of approximately $142 million, or $0.18 per share during the third quarter, primarily due to increased revenues [16][17] - The all-in sustaining costs reduced from the second quarter by $425 to $966 per ounce, with an average realized gold price of $3,458 per ounce, resulting in a margin of $2,492 per ounce [5][16] Business Line Data and Key Metrics Changes - New Afton produced approximately 115,200 ounces of gold and 12 million pounds of copper in the quarter, with B3 cave contributing approximately 4,300 tons per day [5][9] - Rainy River achieved record quarterly production of over 100,000 ounces of gold, a 63% increase over the second quarter, with all-in sustaining costs at $1,043 per ounce sold, a 39% decrease compared to the second quarter [4][12][13] Market Data and Key Metrics Changes - The average realized gold price was $3,458 per ounce, contributing to the overall revenue increase [5][16] - The company generated record quarterly free cash flow of $205 million, with Rainy River contributing $183 million in free cash flow [5][16] Company Strategy and Development Direction - The company aims to ramp up production at New Afton and Rainy River, with a focus on increasing underground development and production rates [6][14] - Exploration initiatives are being advanced, particularly at New Afton’s K Zone, with a budget increase to $22 million for approximately 63,000 meters of drilling [18][19] - The company is focused on maintaining a strong balance sheet while investing in exploration and organic opportunities, with plans for potential capital returns to shareholders [30][32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued significant growth in gold and copper production over the next two years, projecting substantial free cash flow generation [22][24] - The company remains committed to health and safety, with a focus on reducing total reportable incident frequency rates [24] - Management highlighted the importance of local hiring and infrastructure improvements to enhance workforce retention [42] Other Important Information - The company repaid a total of $260 million in debt during the quarter, including $150 million drawn on the credit facility [6][17] - New Afton’s C Zone cave construction is approximately 79% complete, with plans to ramp up processing rates to 16,000 tons per day by early 2026 [6][12] Q&A Session Summary Question: Can you provide a breakout of tonnage from the C and B zones? - The B3 cave contributed 4,300 tons per day, with the C Zone contributing the remainder [26][27] Question: What are your plans for capital allocation with the free cash flow? - The company plans to maintain a strong balance sheet, invest in exploration, and evaluate capital returns to shareholders [30][31] Question: What is the current turnover rate and what are your targets for improvement? - The company is focusing on attracting local talent and improving infrastructure to retain workers, addressing the shortage of skilled miners in Ontario [42] Question: What should we expect for Rainy River's performance for the balance of the year? - The company expects continued positive performance in Rainy River, with no significant changes in trajectory [49] Question: How should we think about grades coming into 2026 at New Afton? - Grades at the start of a cave will be lower, but are expected to improve as the cave grows [56]