Q1 2021 New Gold Inc Earnings Call

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Hello, and thank you for standing by and welcome to New Gold first quarter 2021 earnings Conference call. At this time, all participants are in a listen only mode.

After the speaker's presentation, there will be a question and answer session to ask a question. During the session you will need to press star one on your telephone if you require any further assistance. Please press star zero. Please be advised that today's conference is being recorded.

I'd now like to hand, the conference over to your speaker today and kit.

Shah VP of strategy and business development. Please go ahead.

Thank you Michelle and good morning, everyone. We appreciate you joining us today for new Gold's first quarter 2021 earnings conference call and webcast.

On the line today, we have Renaud Adams, President and CEO and Rob Jose our CFO.

If you wish to follow along with the webcast. Please sign in from our homepage at new gold Dot com.

Before the team begins the presentation I would like to direct your attention to our cautionary language related to forward looking statements found on slides two and three of the presentation.

Today's commentary includes forward looking statements relating to new gold in this respect we refer you to our detailed cautionary note regarding forward looking statements in the presentation. You are cautioned that actual results and future events could differ materially from those expressed or implied in forward looking statements slides two and three provide additional information and should be read.

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We also refer you to the section titled Risk factors in New Gold's latest MD&A and other filings available on SEDAR, which set out certain material factors that could cause actual results to differ.

In addition at the conclusion of the presentation. There are a number of endnotes that provide the important information and should be reviewed in conjunction with the material presented I will now turn the call over to Rob.

Thanks, very much on getting good morning on slide five provides our operating highlights for Q1 of the production details are consistent with our April production press release.

During Q on the company produced 96000 gold equivalent ounces.

The amount consisted of $13 8 million pounds of copper 54600 gold ounces from rainy River and 11990 4994 ounces of gold from New Afton total of 66650 gold ounces lower gold production as compared to the.

The year quarter is primarily due to lower grades and lower throughput at new Afton, our operating expense per equivalent ounce was higher than the prior year quarter due to lower sales volumes and a strengthening Canadian dollar with regards to the impact of the U S. Dollar CAD FX rate and the the first quarter against our FX rate our guided FX.

<unk> rate of one point to eight.

The impact was around $2 million going forward and a sensitivity basis of five cent change in the U S. Cat FX rate represents about a 9 million dollar impact on our operating cash flow.

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On a consolidated all in sustaining costs for the quarter were $550 per equivalent ounce, 7% higher than the prior year quarter, primarily due to lower sales volumes.

Turning to our financial results on slide six first quarter revenue was $164 9 million driven by sales of approximately.

I had a question I guess on the way you're accounting for expenditures for rainy River underground.

<unk> for the underground with the Intrepid zone, and so forth, but it seems like you've done more work than that and I'm. Just wondering is it the way youre accounting for it or am.

Am I missing something and in the way you're going about the work at Intrepid.

No, it's really all capture and and girls capital.

And.

And the booking and on a time line, you know and execution, but.

It's all has a gross capital and as you previous disclosed on our guidance we're expecting.

And between the within guidance on the gross capital.

There was the very interesting part now and now that you mention.

Beyond you and all the the $1 million of expenses is we're very pleased with the same result, and I just take advantage of here.

And here just to clarify that our first level and or has responded extremely well compared to our block model and we see some.

We see some even gained here on the total ounces and we will continue to execute our plan and so as we move forward and you will see and this and the next water.

And the expenses will pick up and we're expecting to two within our plan for the year and continue to to develop there.

Moving.

And you talked about having I think 16000 tons and put.

Able to add to a stockpile are you looking to process any of the material that you do develop this year.

Or is all this going to be stockpiled for some time and the future.

It's a it's really a stockpile, but but definitely anyhow. This is something we eventually will see how many times I mean, you can imagine when you processed 27 on average at a the first quarter on 15 and 16000 tons is there's not a lot too.

And to impact resolved.

This is where we're going but but the truth is that we're currently stockpiling and we'll see later in the year or there is some precautions to be taken as you can imagine it comes with some you know metals and.

From the underground so we gotta be I assure you know well and we are well equipped and Ohio.

And we will decide to.

To any shape processing.

And obviously because of the higher grade, it's it's going to be a bit of a.

A shock and a way to the mill and the way it's been operating.

Is there some sort of plan, maybe when the stockpiles and built up a bit more.

And maybe actually batch process a bit just to see how it reacts in the mill or will you probably just blended.

At this stage.

And we're actually continuing and all on our study.

Previewed. This slows you know we're working on extension and also potential expansion life of mine and bringing more and we're looking at the mailing aspect. So far our intentions will be eventually to brand.

Would it be any opportunity.

Now to improve resolved by may be batching, we're not there yet our plan is to basic basic case is just too to blend.

Okay, Great. That's all I had thanks for now.

Thanks.

And next time, we have no further questions for him.

I will turn the call back over to our presenters for closing remarks.

Yeah.

Thank you Michelle to all of you who have joined US today. Thank you again as always should you have any additional questions. Please do not hesitate to reach out to us by phone or email have a great day, thanks very much.

Thank you everyone. This will conclude today's conference call you may now.

Now disconnect.