Cerrado Gold Posts Net Loss in Q2 2022, Signals Challenging Inflationary Environment in Argentina

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(Kitco News) – On Friday, Cerrado Gold (TSX.V: CERT) reported that the company produced 11,296 ounces of gold and 28,721 ounces of silver in the second quarter of 2022 from its Minera Don Nicolas mine in Argentina. .

The company said gold production was 18% higher than the corresponding period in 2021, due to improvements in head grade and recovery, with the company producing 9,607 ounces of gold and 22,388 ounces of silver in the second quarter of 2021.

Cerrado added that cash operating cost per ounce sold was $1,376 per ounce in the second quarter of 2022, representing a 31% increase from $1,049 per ounce in the first quarter of 2022.

The company explained that the main drivers of the cost increase were a higher stripping ratio, lower head grade, higher labor rates in Argentina and higher fuel costs. government subsidies having been reduced during the period.

However, Cerrado noted that despite these challenges, with the operational improvements achieved and increased production rates over the last twelve months, cash operating costs were down 4% from the second quarter of 2021. .

The company generated revenue of $20.3 million in the second quarter of 2022 from the sale of 10,981 ounces of gold and 27,775 ounces of silver at an average price realized per ounce of gold sold of 1,795 dollars and a price per silver ounce sold of $22.43.

Gold and silver sales revenue for the current period was 14% higher than the three months ended June 30, 2021, due to higher gold sales and higher realized price at during the current period.

Net loss for the three months ended June 30, 2022 was $1.5 million, compared to net profit of $3.4 million in the first quarter of 2022 and net loss of $1.8 million for the quarter ended June 30, 2021.

CEO and Co-Chairman Mark Brennan said, “Despite some challenges associated with the new pits being mined and the impact of a difficult inflationary environment in Argentina, we are pleased that production rates are still within the range of our guidance for 2022. For the remainder of the year, we expect grades to gradually improve as we fully integrate new mining pits into the production plan. In Brazil, work continues to upgrade resources at Monte Do Carmo and feasibility work is progressing as planned.

Cerrado is a Toronto-based gold production, development and exploration company focused on gold projects in the Americas. The company owns 100% of the producing mine Minera Don Nicolás in the province of Santa Cruz, Argentina, and the potential development project, Monte Do Carmo, located in the state of Tocantins, Brazil.

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Ann J. Cox