With increased production from its flagship El Castillo complex in Mexico, junior gold miner Argonaut Gold (TSX: AR; US-OTC: ARNGF) posted stronger profits and revenue in the second quarter.
For the three months ended June 30, Argonaut had adjusted net income of US$7 million on revenue of US$50.2 million, as compared to income of US$4.1 million on revenue of US$42.5 million in the year-ago period.
Based in Reno, Nev., Argonaut has three operating mines and two advanced development projects: the 100% owned El Castillo mine and San Agustin mine, which together form the El Castillo complex in Durango, Mexico; the 100% owned La Colorada gold mine in Sonora, Mexico; the advanced stage San Antonio gold project in Baja California Sur; and the Magino gold project in Ontario.
Total gold equivalent production during the second quarter was 38,441 oz. at all-in sustaining costs (AISC) of US$832 per oz. gold equivalent versus 29,730 oz. at an AISC of US$906 per oz. in the year-ago period - or a 29% rise in production.
The company comments: "Although the use of low-grade stockpiles will ultimately lead to lower 2018 production at La Colorada, with the continued outperformance at our new San Agustin mine, we remain comfortable with our consolidated annual production and cost guidance of between 165,000 and 180,000 gold equivalent ounces at cash costs between US$700 and US$800 per gold ounce sold."
Argonaut plans to spend up to US$45 million on capital expenditures and exploration initiatives in 2018, of which US$20.1 million has been spent through June 30.
For all of 2018, Argonaut continues to guide for total gold-equivalent production of 165,000 to 180,000 ounces.