Toronto, Ontario - IAMGOLD Corporation (NYSE: IAG) (TSX: IMG) ('IAMGOLD' or the 'Company') reported its financial and operating results for the third quarter ended September 30, 2022.
HIGHLIGHTS:
Attributable gold production of 184,000 ounces in the third quarter and 528,000 ounces year-to-date ('YTD') as a result of continued strong performance from Essakane and improvements at Rosebel.
The Company expects that annual production will exceed the top end of the previous guidance range of 570,000 to 640,000 ounces and is revising guidance upwards to 650,000 to 705,000 ounces.
Cost of sales per ounce sold of $1,140 ($1,102 YTD), cash cost1 per ounce sold of $1,126 ($1,087 YTD) and all-in sustaining costs1 ('AISC') per ounce sold of $1,559 ($1,550 YTD).
The Company expects AISC1 to be below the bottom end of guidance range of $1,650 to $1,690 and revised guidance downwards to between $1,600 and $1,650 per ounce sold. Cash costs1 guidance for 2022 is revised downwards to be between $1,100 and $1,130 per ounce sold from the previous guidance range of $1,100 to $1,150 per ounce.
Earnings before interest, income taxes, depreciation and amortization ('EBITDA')1 of $(41.3) million ($195.0 million YTD) and adjusted EBITDA1 of $103.1 million ($350.6 million YTD).
Mine-site free cash flow1 of $59.2 million ($189.3 million YTD).
Net loss and adjusted net loss per share attributable to equity holders1 of $(0.23) and $(0.03), respectively; YTD net earnings (loss) and adjusted net earnings (loss) per share attributable to equity holders1 of $(0.20) and $0.01, respectively.
Cash, cash equivalents and short-term investments of $536.1 million and liquidity1 of $636.8 million at September 30, 2022.
As of September 30, 2022, the Cote Gold project was approximately 64.2% complete, with detailed engineering fully complete and construction in line with the updated technical report. The Company's share of remaining project spend to bring Cote Gold into production is estimated to be between $1.0 and $1.1 billion from October 1, 2022, net of leases and working capital.
On October 18, 2022, the Company announced that it had entered into a definitive agreement with Zijin Mining Group Co. Ltd. to sell its interests in the Rosebel mine for cash consideration of $360 million plus working capital adjustments, as well as the release of approximately $41 million of IAMGOLD obligations related to equipment leases, on closing.
'IAMGOLD has continued to build upon its recent successes, reporting attributable gold production of 184,000 ounces, which represents the highest quarterly production for the Company in over 2.5 years, driven by record production from Essakane,' said Maryse Belanger, Chair and Interim President and CEO of IAMGOLD. 'On behalf of the Board and the executive team, we applaud the tireless efforts of the IAMGOLD team for this achievement and their continued commitment to operating safely and responsibly.
'The Cote Gold Project is approximately 64% complete and advancing well following the schedule and cost update released in the summer. With approximately 1,500 workers on site, the project is nearing peak capacity and has seen significant progress in the third quarter towards the target of production in early 2024. The announced sale of Rosebel to Zijin Mining last month represents the first significant step towards addressing the funding commitments to deliver Cote Gold. The remaining funding alternatives are well advanced and we expect to be able to provide further updates in the fourth quarter.'
QUARTERLY REVIEW
The following table summarizes certain operating and financial results for the three months ended September 30, 2022 (Q3 2022), June 30, 2022 (Q2 2022) and September 30, 2021 (Q3 2021) and the nine months ended September 30 (or YTD), 2022 and 2021 and certain measures of the Company's financial position as at September 30, 2022, June 30, 2022 and December 31, 2021:
Financial Results
For the third quarter ended September 30, 2022, net loss and adjusted net loss1 per share attributable to equity holders were ($0.23) and ($0.03), respectively. EBITDA1 was ($41.3) million and adjusted EBITDA1 was $103.1 million. Adjusted net loss per share attributable to equity holders and adjusted EBITDA include the reversal of an after-tax non-cash impairment charge of $74.0 million ($115.8 million before tax) related to the announced definitive agreement to sell IAMGOLD's interests in the Rosebel mine to align the carrying value of the Rosebel cash generating unit with the sales price.
Mine-site free cash flow for the third quarter 2022 was $59.2 million, up $16.4 million, from the prior quarter, primarily due to higher free cash flow at Essakane ($20.2 million) and Westwood ($9.2 million) due to higher sales volume, partially offset by lower free cash flow at Rosebel ($13.0 million) primarily due to changes in working capital and lower average realized gold price.
Net cash from operating activities for the third quarter 2022 was $117.7 million, an increase of $35.8 million from the prior quarter, primarily due to decrease in income taxes paid ($22.4 million) and a net inflow in non-cash working capital movements ($20.9 million), partially offset by lower net cash earnings ($5.2 million) and lower settlement of derivatives ($1.7 million). Net cash from operating activities for YTD 2022 was $341.9 million, an increase of $124.4 million from the same prior year period, primarily due to proceeds from 2022 Prepay Arrangements ($177.0 million) and an increase of cash inflows from the settlement of derivatives ($21.9 million), partially offset by lower net cash earnings ($48.9 million), an increase in income taxes paid ($21.1 million), and a decrease in proceeds from insurance claim ($9.5 million).
Net cash used in investing activities for the third quarter 2022 was $228.9 million, a decrease of $40.3 million from the prior quarter, primarily due to a decrease in capital expenditures for property, plant and equipment ($26.1 million) mainly related to the Cote Gold construction and timing of financing costs paid and capitalized as borrowing costs ($9.8 million). Net cash used in investing activities for YTD 2022 was $658.6 million, an increase of $291.2 million from the same prior year period, primarily due to an increase in capital expenditures for property, plant and equipment ($261.1 million) mainly related to the Cote Gold construction and an increase in financing costs paid and capitalized as borrowing costs ($8.8 million), partially offset by proceeds from the disposal of marketable securities ($25.1 million).
Net cash from financing activities in the third quarter 2022 was $217.4 million, an increase of $87.5 million from the prior quarter, primarily due to proceeds from the Credit Facility drawdowns ($80.0 million), proceeds from the equipment loans ($4.6 million), and decrease in dividends paid to non-controlling interest ($4.8 million) on the declaration of dividends from subsidiaries. Net cash from financing activities for YTD 2022 was $339.8 million, an increase of $381.4 million from the same prior year period, primarily due to proceeds from the Credit Facility drawdowns ($380.0 million).
Liquidity and Capital Resources
As at September 30, 2022, the Company had $535.6 million in cash and cash equivalents, $0.5 million in short-term investments and net debt1 of $409.3 million. Approximately $100.7 million was available under the Company's secured revolving credit facility ('Credit Facility') resulting in liquidity1 at September 30, 2022, of approximately $637 million.
The Cote Gold UJV required its joint venture partners to fund, in advance, two months of future expenditures. During the third quarter, the Cote UJV amended this requirement to two months from three months. The Company uses dividends and intercompany loans to repatriate funds from its operations and the timing of dividends may impact the timing and amount of required financing, including the Company's drawdowns under the Credit Facility. As at September 30, 2022, $237.8 million of cash and cash equivalents was held by Cote Gold and Essakane. The company has funded its portion of the Cote UJV funding cash generated from its operations and drawdowns on the Credit Facility. Restricted cash in support of environmental closure costs obligations related to Essakane, Doyon division and Cote Gold project totaled $47.2 million.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
Statements included in this news release, including any with respect to the Company's future financial or operating performance and other statements that express management's expectations or estimates of future performance, including statements in respect of the prospects and/or development of the Company's projects, other than statements of historical fact, constitute forward-looking information or forward-looking statements within the meaning of applicable securities laws (collectively referred to herein as 'forward-looking statements') and such forward-looking statements are based on expectations, estimates and projections as of the date of this news release. Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Forward-looking statements are generally identifiable by the use of words such as 'may', 'will', 'should', 'continue', 'expect', 'budget', 'forecast', 'anticipate', 'estimate', 'believe', 'intend', 'plan', 'schedule', 'guidance', 'outlook', 'potential', 'seek', 'targets', 'suspended', 'strategy', or 'project' or the negative of these words or other variations on these words or comparable terminology. Forward-looking statements in this news release include, but are not limited to, statements with respect to: construction costs and site expenditures; including remaining costs to complete and schedule for Cote Gold; the Company's strategic review of certain of its assets; the proposed completion of the sale of the Rosebel mine and anticipated timing thereof; the impact of changes global economic conditions, including increases in interest rates and inflationary pressures on the costs of goods and services; the impact of COVID-19 and the war in Ukraine on the Company, including its operations, the project schedule for Cote Gold, key inputs, staffing and contractors; the Company's guidance for production and recovery from its operating mine sites; cost of sales and revisions to cost guidance; cash costs; AISC; securing of alternative sources of consumables; costs of production; depreciation expense; effective tax rate; expected capital expenditures; operations outlook; expected benefits from the operational improvements and de-risking strategies enacted by the Company; development and expansion projects; exploration; impairment assessments and estimates; the expected receipt of permits; permitting timelines; sale transactions; the future price of gold and other commodities; foreign exchange rates and currency fluctuations; requirements for additional capital; the Company's capital allocation; the estimation of mineral reserves and mineral resources; the realization of mineral reserve and mineral resource estimates; security concerns in the jurisdictions in which the Company operates; expected collective bargaining discussions; and government regulation of mining operations.
The Company cautions the reader that forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, financial, operational and other risks, uncertainties, contingencies and other factors, including those described below, which could cause actual results, performance or achievements of the Company to be materially different from results, performance or achievements expressed or implied by such forward-looking statements and, as such, undue reliance must not be placed on them. Forward-looking statements are also based on numerous material factors and assumptions, including as described in this news release, including with respect to: the Company's present and future business strategies; operations performance within expected ranges; anticipated future production and cash flows; local and global economic conditions and the economic environment in which the Company will operate in the future; legal and political developments in the jurisdictions in which the Company operates; the price of gold and other key commodities; projected mineral grades; international exchanges rates; anticipated capital and operating costs; the availability and timing of required governmental and other approvals for the construction of the Company's projects.
Risks, uncertainties, contingencies and other factors that could cause actual results, performance or achievements of the Company to be materially different from results, performance or achievements expressed or implied by such forward-looking statements include, without limitation: the Company's business strategies and its ability to execute thereon, including the ongoing strategic review of certain of the Company's assets; the ability of the Company to satisfy the conditions to complete the proposed sale of the Rosebel mine; political and legal risks; risks associate with the estimation of mineral reserves and mineral resources; the ongoing impacts of COVID-19 (and its variants) and the Ukraine war on the Company and its workforce, the availability of labour and contractors, key inputs for the Company and global supply chains; changes in global economic conditions, including increases in interest rates and inflationary pressures on the costs of goods and services; the volatility of the Company's securities; potential engagements with activist shareholders; litigation; contests over title to properties, particularly title to undeveloped properties; mine closure and rehabilitation risks; management of certain of the Company's assets by other companies or joint venture partners; the availability of insurance covering all of the risks associated with a mining company's operations; business risks, including pandemics, adverse environmental conditions and hazards; unexpected geological conditions; potential shareholder dilution; increasing competition in the mining sector; the profitability of the Company being highly dependent on the condition and results of the mining industry as a whole, and the gold mining industry in particular; changes in the global prices for gold and certain other commodities (such as diesel and electricity); consolidation in the gold mining industry; legal, litigation, legislative, political or economic risks and new developments in the jurisdictions in which the Company carries on business; government actions taken in response to COVID-19 and other public health emergencies and pandemics, including new variants of COVID-19, and any worsening thereof; changes in taxes, including mining tax regimes; the failure to obtain in a timely manner from authorities key permits, authorizations or approvals necessary for exploration, development or operation, operating or technical difficulties in connection with mining or development activities, including geotechnical difficulties and major equipment failure; seismic activity; the inability to participate in any gold price increase above the cap in any collar transaction entered into in conjunction with certain gold sale prepayment arrangements; the availability of capital; the level of liquidity and capital resources; access to capital markets and financing; the Company's level of indebtedness; the Company's ability to satisfy covenants under its outstanding debt instruments; changes in interest rates; adverse changes in the Company's credit rating; the Company's choices in capital allocation; effectiveness of the Company's ongoing cost containment efforts; the ability to execute on the Company's de-risking activities and measures to improve operations; risks related to third-party contractors, including reduced control over aspects of the Company's operations and/or the failure of contractors to perform; risks arising from holding derivative instruments; changes in U.S. dollar and other currency exchange rates, interest rates or gold lease rates; capital and currency controls in foreign jurisdictions; assessment of carrying values for the Company's assets, including the ongoing potential for material impairment and/or write-downs of such assets; the speculative nature of exploration and development, including the risks of diminishing quantities or grades of reserves; the fact that reserves and resources, expected metallurgical recoveries, capital and operating costs are estimates which may require revision; the presence of unfavourable content in ore deposits, including clay and coarse gold; inaccuracies in life of mine plans; failure to meet operational targets; equipment malfunctions; security risks, including civil unrest, war or terrorism; information systems security threats and cybersecurity; laws and regulations governing the protection of the environment; employee relations and labour disputes, and the ability of the Company to successfully negotiation collective labour agreements; the maintenance of tailings storage facilities and the potential for a major spill or failure of the tailings facilities due to uncontrollable events, such as extreme weather or seismic events; lack of reliable infrastructure, including access to roads, bridges, power sources and water supplies; physical and regulatory risks related to climate change; the potential direct or indirect operational impacts resulting from external factors, including infectious diseases, public health emergencies or pandemics, such as COVID-19, unpredictable weather patterns and challenging weather conditions; attraction and retention of key employees and other qualified personnel; availability and increasing costs associated with mining inputs and labour; the availability of qualified contractors and the ability of contractors to timely complete projects on acceptable terms; the relationship with the communities surrounding the Company's operations and projects; indigenous rights or claims; illegal mining; and the inherent risks involved in the exploration, development and mining industry generally. Please see the Company's AIF or Form 40-F available on www.sedar.com or www.sec.gov/edgar.shtml for a comprehensive discussion of the risks faced by the Company and which may cause actual results, performance or achievements of the Company to be materially different from results, performance or achievements expressed or implied by forward-looking statements.
Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise except as required by applicable law.
IAMGOLD CORPORATION 
