Centerra Gold (US:CGAU)2023-11-01 15:59Financial Data and Key Metrics Changes - Centerra Gold reported net earnings of $61 million or $0.28 per share for Q3 2023, with adjusted net earnings of $44 million or $0.20 per share after accounting for one-time items [10][11] - The company ended Q3 with a cash balance of $492 million, an increase of $90 million during the quarter, and total liquidity of $890 million [40] - Gold production costs were $1,050 per ounce, and all-in sustaining costs were $1,150 per ounce, representing a 16% and 28% decrease from the previous quarter, respectively [39] Business Line Data and Key Metrics Changes - Mount Milligan produced approximately 39,000 ounces of gold and 15 million pounds of copper in Q3, with gold production costs now expected to be between $1,050 and $1,100 per ounce for the full year [66] - Oksut exceeded expectations with over 86,000 ounces of gold produced in Q3, and full-year production guidance has been increased to 190,000 to 200,000 ounces [49][67] - The Molybdenum Business Unit sold approximately 2.7 million pounds of molybdenum at an average price of $24.08 per pound, generating $68 million in revenue [51] Market Data and Key Metrics Changes - The average realized price for gold was $1,741 per ounce, and for copper, it was $2.99 per pound, reflecting the existing stream arrangements for Mount Milligan [69] - Cash provided by operating activities was $167 million in Q3, with free cash flow of $144 million, driven by strong performance at Oksut [70] Company Strategy and Development Direction - The company is focused on funding capital returns to shareholders, investing in internal growth projects, and evaluating external growth opportunities while maintaining a significant cash balance [45] - A comprehensive asset optimization review has been launched to improve safety, productivity, and cost efficiencies, expected to be completed in 2024 [48] - The company plans to continue operational and technical improvements at Mount Milligan to unlock its full potential, with expectations for higher gold production in 2024 [63] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, expecting to generate robust free cash flow in Q4 and further increase cash balances [13] - The company noted that recoveries for gold and copper are expected to be similar to those achieved in 2023, with ongoing metallurgical reviews aimed at increasing recoveries [47] - Management highlighted the successful ramp-up at Oksut and the positive cash generation potential in the upcoming quarters [29] Other Important Information - Centerra published its 2022 annual ESG report in Q3, emphasizing its commitment to sustainable and responsible mining practices [5] - The company congratulated the Mount Milligan team for receiving the BC Mine Reclamation Award for Outstanding Reclamation Achievement in 2023 [8] Q&A Session Summary Question: Can you provide insights on Mount Milligan for 2024? - Management indicated that recoveries will be similar to 2023, with expectations for higher gold production due to feeding higher-grade gold [17][18] Question: What is the working capital adjustment for Oksut in Q4? - Management noted that October was a strong month and that they are on track, with high lead solution grades expected to decrease as planned [23][24] Question: What is the outlook for the Molybdenum Business Unit? - Management stated that they do not expect significant cash outlay in Q4 and are hopeful for a return of working capital due to molybdenum price fluctuations [83]