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North American Palladium Achieves Highest Quarterly Revenue Announces Special Dividend

Aug 2, 2019

North American Palladium reported the highest quarterly revenue in the company's 25-year history when it released its 2nd quarter report yesterday containing the operational results for the three months ending June 30, 2019. 
North American Palladium operates the Lac des Iles MIne northwest of Thunder Bay, Ontario employing 700 people at its underground mine and surface operations.
The company achieved record revenue $135.6 million based on the sale of 56,121 oz. of palladium compared to $94.1 million in the second quarter of 2018. 
Revenue for the first six months of 2019 reached $263.9 million based on the sale of 112,896 oz. of palladium.
North American Palladium's net income for the second quarter was $36.6 million or $0.62 per share compared to $14.2 million or $0.24 per share reported for Q2 2018. Year to date net income was $66.1 million, or $1.12 per share.
Substantial cash from operations: Cash provided from operations was $58.8 million, compared to $33.1 million for the same period in 2018. Year to date cash provided from operations was $134.6 million.
Strong free cash flow: Free cash flow for the quarter was $35.4 million, an increase from $16.4 million in Q2 2018; with year to date free cash flow at $90.6 million.
Fuelling North American Palladium's financial performance was record  production from its underground mine which averaged just over 7,000 tonnes perday for the quarter the highest in the company's history. This is a significant increase compared to the 5,856 tpd produced in Q2 2018 and a slight increase over the 6,755 tpd in Q1 2019.
The company's board of directors announced that a special divident of $0.35 per share will be issued to all common shareholders on September 1, 2019.
"Strong palladium prices combined with the highest-ever underground production enabled us to deliver record revenue for the second consecutive quarter. Overall, the Lac des Iles Mine operated exceptionally well and continues to demonstrate its ability to realize operational upside,” said Jim Gallagher, President and CEO of North American Palladium.
The mine expansion project is ahead of schedule this quarter in terms of both development metres and rate of underground production and the Company is well on its way to achieving 12,000 tpd by 2021. In addition, in June and July, the mill’s average throughput met and exceeded budget figures, as a result of the Company’s investment in remediation initiatives focused on maintenance and process improvements. These two positive outcomes have led to slightly higher operating expenses compared to Q2 2018.
“Even with our increased spend in support of the mine expansion, tailings dam construction and mill improvements, North American Palladium delivered almost $91 million in free cash flow in the first half of the year,” said Gallagher.