Alamos Gold reports 2015 production and 2016 guidance

 Alamos Gold Inc. [AGI-TSX, NYSE] reported fourth quarter and annual 2015 production. The company also provided 2016 production and operating guidance.

“We closed 2015 on a strong note achieving full year guidance with record production of 104,700 ounces of gold in the fourth quarter. The strong fourth quarter performance was driven by improved production from the high grade mill at Mulatos and record production from Young-Davidson where we achieved our year-end underground mining rate target of 6,000 tonnes per day,” said John A. McCluskey, President and CEO.

“Through merger and acquisition, capital investment, and cost reduction we have built a stronger company that is better positioned to navigate the challenges of the current gold price environment. As we execute on our core plan of completing the underground ramp up at Young-Davidson and developing the Cerro Pelon and La Yaqui deposits at Mulatos, we expect the benefits of these efforts will continue to unfold,” McCluskey added.

Fourth Quarter and Full Year 2015 Operating Highlights

 Achieved guidance with production of 380,000 ounces of gold in 2015

• All-in sustaining costs have not been finalized but are expected to be consistent with guidance at the mine site level
• Reported record quarterly production of 104,734 ounces of gold in the fourth quarter of 2015, including 44,694 ounces from Young-Davidson, 41,830 ounces from Mulatos and 18,210 ounces from El Chanate
• Increased underground mining rates to average a new record of 5,900 tonnes per day (tpd) in the fourth quarter at Young-Davidson, and over 6,000 tpd in December, consistent with the year-end target
• Achieved a new record low in terms of unit mining costs at Young-Davidson of $27 (CAD $35) per tonne benefiting from a nine month hydro rebate of $2 (CAD $3) per tonne recorded in the fourth quarter
• Sold 104,419 ounces of gold in the fourth quarter of 2015 at an average realized price of $1,109/oz, $3/oz above the London Fix, for revenues of $115.8 million

2016 Guidance Overview

• Production guidance of 370,000 to 400,000 ounces of gold, an increase over 2015 with production growth from both Young-Davidson and Mulatos
• Expect consolidated all-in sustaining costs to decrease by over $100/oz to $975/oz driven by an 18%, or $175/oz decrease in all-in sustaining costs at Young-Davidson to $825/oz
• Global capital budget of $138-158 million in 2016, representing a 20% decrease from the mid-point of 2015 guidance
• With a focus on margin expansion, the company has accelerated the transition to owner development at Young-Davidson. This will have an immediate impact, reducing per metre development spending and resulting in substantial capital and operating savings over the next several years
• All mines are expected to self-finance exploration, sustaining and growth capital spending and be free-cash flow neutral in 2016 at a gold price of $1,100 per ounce
• Corporate and administrative expenses are expected to decrease to $16 million (excluding stock based compensation), a $9 million, or 36% reduction from the combined Alamos and AuRico 2015 budgets prior to the merger