Kirkland Lake Gold Q2 Report Success Driven By Record Production at Fosterville.

Kirkland Lake Gold reports a total of 214,593 oz. in total gold production from its mines during Q2 2019. This compared to 164,685 oz in Q2 2018. Combined with 231,879 oz produced in Q1, KLG has produced 446,472 oz of gold during the first half of 2019. That's 43% higher than 312,329 ounces in the first half of 2018. 

 

On a consolidated basis, KLG continues to target full-year 2019 production of 950,000 – 1,000,000 ounces.  

KLG achievement has been paced by quarterly production at Kirkland Lake Gold's Fosterville mine totaling 140,701 ounces  As of June 30, 2019 , Fosterville has produced  269,145 ounces at June 30, 2019. 

 

Record quarterly production at Fosterville totaling 140,701 ounces, represents an increase of 82% from 77,462 ounces in Q2 2018 and 10% higher than 128,445 ounces in Q1 2019 (H1 2019 production of 269,145 ounces, a 90% increase from 141,305 ounces in H1 2018).

 

“Fosterville achieved a record quarter in Q2 2019, with production exceeding planned levels largely due to strong grade performance in the Swan Zone, " explained Tony Makuch, KLG President and CEO. 

 

"We are targeting higher levels of production from Fosterville in both the third and fourth quarters of the year as ounces produced from the Swan Zone increase, with the mine tracking well towards its full-year 2019 guidance of 570,000 – 610,000 ounces," he added.

 

Gold poured in Q2 2019 of 216,166 ounces, with consolidated gold sales totaling 212,091 ounces (H1 2019 gold poured of 446,417 ounces, with total gold sales of 445,020 ounces).

 

Production at Macassa Mine in Kirkland Lake, Ontario in Q2 2019 totaled 49,196 ounces was lower  to the record production of 72,776 ounces the previous quarter, but first half (H1) 2019 production of 121,972 ounces, 6% higher than 114,609 ounces in H1 2018.

 

"Tonnes processed during Q2 2019 were lower than expected at Macassa, largely reflecting excess water from the spring run-off, which limited the use of the lower loading pocket at the #3 Shaft, " Makuch said. 

 

"The impact of the water extended longer than anticipated, through to the end of the quarter. Water levels are receding, and we do not expect third and fourth quarter production to be impacted. Macassa remains on track to achieve its full-year 2019 guidance of 240,000 – 250,000 ounces, ” Makuch explained.

 

Production at Holt Complex of 24,696 ounces versus 26,652 ounces in Q2 2018 and 30,658 ounces in Q1 2019 (H1 2019 production of 55,355 ounces, similar to 56,415 ounces in H1 2018).

 

Other key developments during Q2 2019, include:

 

Exploration success at Macassa.

Underground drilling expands high-grade mineralization in the South Mine Complex (“SMC”) to the east, west and to depth; two new areas of high-grade mineralization along the Amalgamated Break identified.

 

Strong Q1 2019 net earnings and free cash flow:

On May 7, 2019, the Company reported strong financial results for Q1 2019, including record adjusted net earnings per share of $0.53 and free cash flow of $93.1 million.

 

Cash and cash equivalents at June 30, 2019 totaled $469 million, an increase of $137 million or 41% from $332 million at December 31, 2018 (and an increase of $53 million or 13% from $416 million at March 31, 2019).

 

Quarterly dividend of C$0.04/share paid on April 12, 2019 to shareholders of record at March 31, 2019; Q2 2019 quarterly dividend of $0.04/share announced on May 7, 2019, to be paid on July 12, 2019 to shareholders of record on June 28, 2019. The Q2 2019 dividend payment is the first time the Company’s quarterly dividend is being paid in US dollars. (US dollar dividend payments are converted into Canadian dollars for Canadian shareholders using the spot price exchange rate on July 11, 2019, the date prior to the payment date).

 

Common share price increased 36% in Q2 2019 (55% year to date) on the TSX, closing on Friday, July 5, 2019 at C$55.03/share ($42.07/share on the NYSE and A$61.54/share on the ASX (July 4)).