Junior US miner Fortitude Gold Corp. [OTCQB:FTCO] reported strong third-quarter results despite a weakening of the gold price in the global markets and confirmed that it expects to produce 40,000 ounces of gold this year, at the top of its previous forecast range.
During the reporting quarter, the Nevada-based company sold 9,419 ounces of gold at an average price of $1,719 per ounce. Its total cash cost per ounce came down to $613 after by-product credits.
The miner produced 9,500 ounces of gold during the quarter which tallies with its plans to reach a total of 40,000 ounces by the end of 2022.
Net income stood at $1.7 million, or $0.07 per share, with cash and cash equivalents at quarter end totalling $42.2 million.
Fortitude Gold is a US-based gold producer targeting projects with low operating costs, high margins, and strong returns on capital. Its strategy is to grow organically, remain debt-free and distribute substantial dividends. Fortitude’s Nevada Mining Unit consists of five high-grade gold properties located in the Walker Lane Mineral Belt and a sixth high-grade gold property in west central Nevada.“Production results for the quarter are in line with our 2022 production outlook range. We continue to execute our strategic business strategy, which has resulted in Fortitude outperforming our industry peers on year-to-date valuations during this strong market pullback in the mining equities,” said president and chief executive Jason Reid.
Mine operations continue to focus on the Isabella Pearl high-grade phase two open-pit, its one operational mine, but the company says it is moving closer to building its second mine in Nevada, one of the world’s most mining-friendly jurisdictions.
Isabella Pearl produced its first gold in April 2019 just over 10 months from project ground-breaking. Proven and probable reserves include 2,247,400 tonnes grading 3.05 grams per tonne (g/t) gold and 18 g/t silver, equating to 220,100 gold ounces and 1,310,700 silver ounces.
Further drilling planned in Q4 and in 2023
During the third quarter, the company continued its exploration drilling programme focusing on the Golden Mile and County Line properties.
In August Fortitude Gold announced maiden drill results from its County Line property located in Mineral and Nye counties in Nevada. Multiple high-grade gold intercepts included 6.10 meters grading 15.18 grams per tonne of gold (g/t) within 15.24 meters grading 7.66 g/t gold.
Looking at the year ahead, a significant number of surface samples from the Ripper property proved interesting and the company is looking at potentially extending its drill programme at the site into 2023.
“Our exploration team continues to be exceptionally busy during the fourth quarter with drill programs planned along the Isabella Pearl trend, Golden Mile, County Line and East Camp Douglas properties,” said Reid.
Dividends of $2.9million
Fortitude Gold is a regular dividend payer with a very high dividend yield, prized by many investors for just this. During the quarter the company paid out $2.9 million in dividends to shareholders and invested another $3.7 million in exploration while managing to increase its cash balance to $42.2 million.
