Annual production of 54,494 Gold Equivalent Ounces ("GEO"); in-line with guidance
Adjusted EBITDA of $4.5 million for Q4, and $24.4 million for the full year excluding project sales proceeds from sale of Monte Do Carmo
Received $34 million in Asset sale and Option payment proceeds in Q4: Received $49 million for the full year with up to $25 million ($15 million guaranteed) due in the coming years.
Continued strengthening of the Balance sheet with a US$54.5 million improvement in the working capital position achieved
Management to host a Conference Call to discuss the financial and operational results on May 1st, 2025, at 11:00 AM EDT
TORONTO, ON / ACCESS Newswire / May 1, 2025 / Cerrado Gold Inc. [TSX.V:CERT][OTCQX:CRDOF; FRA:BAI0] ("Cerrado" or the "Company") announces its operational and financial results for the fourth quarter ("Q4/24") including its Minera Don Nicolas ("MDN") gold project in Santa Cruz Province, Argentina and its Mont Sorcier High Purity DRI Iron Project in Quebec.
Production results for MDN were previously released on January 15, 2025. The Company's financial results are reported and available on SEDAR+ (www.sedarplus.com) and the Company's website (www.cerradogold.com).
Q4/24 and Annual MDN Operating Highlights
Production of 10,431 GEO in Q4 and Annual production of 54,494 GEO
Adjusted EBITDA of $4.5 million in Q4 and US$24.4 million for the year excluding assets sales and Option payment proceeds.
Received $34 million in Asset sale and Option payment proceeds in Q4: Received $49 million for the full year with up to $25 million ($15 million guaranteed) due in the coming years.
AISC of $1,953 during Q4 vs $1,594 in Q4/23 due to lower production levels and ongoing inflationary pressures in Argentina
Received Asset Sale and Option payments totaling $34 MM during the quarter, significantly strengthening the balance sheet.
Focus remains on ramping up heap leach production to 4,000 - 4,500 GEO per month
Operational results for the fourth quarter demonstrated a decrease in production relative to Q4/23 as high-grade ore to the CIL plant declined as mining from the Calandrias Norte pit was completed, and as the operation transitioned to focus on heap leach production. Ore from the Calandrias Norte open pit was exhausted late in the quarter and is now being replaced by processing lower grade stockpiles through the CIL plant. With higher gold prices, the CIL plant is expected to continue processing low grade stockpiles through Q2/25 when it will be blended with new high-grade material from initial underground mining feed from Q3/25 onward. The ramp up of heap leach operations continues to improve as crushing capacity continued to climb with production of 5,956 GEO during the quarter. The performance of the heap leach continues to depend on the output of the crushing circuit which, as of April 2025, is supported by the installation of a new secondary crusher. Recovery rates were in line with expectations, and we expect to see minor improvements from the heap leach as the new crushing and agglomeration circuit becomes operational in Q2/25. Due to the relatively fixed cost nature of the MDN operation, unit operating costs were higher in the quarter relative to the comparable period in 2023 due to lower production levels and inflationary cost pressure. Going forward, as rental equipment is replaced, a more stable fiscal environment materializes and production increases, costs are expected to decline.
Mark Brennan, CEO and Chairman commented, "The results from this quarter demonstrate our continued ability to maintain production while paying down debt through increased cashflows. This process has continued through the first quarter of 2025. We are well positioned to deploy capital in a strategic and fiscally prudent manner to ramp up exploration efforts at MDN, initiate our underground production at Paloma, complete a bankable feasibility study at our high grade/ purity Mont Sorcier DRI iron project, and fund the development of the Lagoa Salgada Project, assuming closing of the proposed acquisition of Ascendant Resources Inc.), while continuing to increase Cerrado's financial strength., We anticipate 2025 will be a transformative year for Cerrado."
Cerrado has made significant improvements to its working capital position and balance sheet over the 2024 year. As at December 31, 2024, the Company had a working capital deficit of $12.9 million, a decrease of $54.5 million from December 31, 2023. The Company's cash and cash equivalents balance at December 31, 2024 was $26.0 million. This is an increase from cash and cash equivalents of $0.4 million at December 31, 2023. The key contributors to the Company's improved working capital position at December 31, 2024 is lower current debt payables of $35.0 million and lower trade and other payables of $29.2 million.
Further improvement in the balance sheet has continued through Q1/25 and into Q2/25, with the final US$5m payment paid to the sellers of MDN as well as payments of amounts outstanding being repaid to royalty holders of MDN.
the current focus at MDN will be increasing production rates at its heap leach operation to around 4,000-4,500 GEO per month for the next 4 years, as outlined in the recent NI 43-101 Preliminary Economic Assessment Technical Report and Mineral Resource Estimate for The Minera Don Nicolas Mine in Santa Cruz, Argentina ("PEA"). Consistent production along with historically high gold prices, ensures the Company is well placed to continue its debt and payables reduction program as well as fund future development, exploration and push forward its development projects in Quebec and in Portugal, subject to closing the acquisition of Ascendant Resources.
Q4 Financial Performance
Table 1. Q4 and Annual 2024 Operational and Financial Performance
The Company produced 10,431 GEO and sold 10,108 GEO during Q4 2024. Production levels decreased from Q4 2023 as ore grades through the CIL circuit decreased with increased processing of low-grade stockpiles as mining at Calandrias Norte deposit was completed. As previously stated, lower production and ongoing inflationary pressures in Argentina, especially for labour, have seen unit costs increase in Q4/24 relative to Q4/23. Production from Calandrias Sur heap leach operations continued to ramp up towards full production during the quarter and achieved 5,956 GEO during Q4 2024. The crushing plant is now operating as expected, and additional capacity is planned to be installed during H1 2025, which is expected to provide much more stability over production rates and more consistent feed to the heap leach pad, improving Cerrado's overall operational and financial performance. As of April, production from the heap leach is running at approximately +3,000 GEO per month and should reach full capacity in Q2/25.
As noted, the Company completed a PEA of the heap leach operations at Calandrias Sur, Calandrias Norte and the development proposals for defined ore in the Martinetas area. MDN is currently following the development and production profile outlined in the PEA, however underground production is being brought forward to H2/25, targeting increased production and profitability for the near term. Any exploration success, particularly for new high-grade resources at MDN, would also be additive to the PEA.
Going into the first quarter of 2025 and beyond, Cerrado's MDN operations are benefitting from the completion of its recent expansionary capital expenditure program to grow production with its new heap leach operations, while sustaining CIL production from stockpiles until the end of Q2 2025. Higher gold prices have enabled the plant to remain operational by processing stockpiles through March and April. While the near-term cash generation profile continues to improve, the Company is actively working to term out the maturity of its current short term debt profile.
As noted in the Press Release dated April 15, 2025, the Company raised its 2025 annual production guidance to 55,000 - 60,000 GEO, up from 50,000 - 55,000 GEO, to include the addition of modest underground production. AISC costs are expected to be modestly higher than previously anticipated with an AISC of between $1,500 - $1,700 per GEO as compared to prior expectations of $1,300 - $1,500 per GEO. The increased costs are the result of the inclusion of underground mining, ongoing processing of low-grade ores, continued inflationary pressure in Argentina, and the ongoing use of rental crushing equipment as the new permanent crushing capacity is being installed.
A new Exploration initiative began in Q1 with the focus on growing the known resources at MDN beyond those outlined in the recent Mineral Resource Estimate ("MRE"). The focus remains on defining high grade-near surface targets that can readily be brought into the mine plan, underground exploration as well as a regional program to better understand the potential of the significant land package Cerrado holds at MDN.
At the Mont Sorcier high grade/ purity DRI iron project operated by Cerrado's wholly owned subsidiary Voyager Metals Inc., work continued to advance the project with several workstreams related to permitting, social license and the initiation of the Feasibility Study which is targeted to be completed during Q1 2026. The high quality of the concentrate, grading over 67% iron, from the Mont Sorcier project is well positioned to support the growing demand from the global Green Steel transition due to the reduced emissions generated by steel producers using high grade concentrates.
The Company currently anticipates closing the proposed acquisition of all the outstanding common shares of Ascendant Resources Inc. not already owned by Cerrado in May 2025 (see Press Release dated February 3, 2025, for full details). Closing of the proposed acquisition is subject to the satisfaction of certain closing conditions and there is no assurance that it will close. Assuming closing of the transaction, the Company plans to continue to advance the Lagoa Salgada VMS project through several key workstreams to reach a construction decision by Q4 2025/Q1 2026.
Conference Call Details
Cerrado Gold Management will host a conference call on May 1, 2025, at 11:00 AM EDT to discuss the Q4 and Annual financial and production results. The presentation for the call can be found on the investor page on Cerrado Gold's website at cerradogold.com. Call details are as follows:
Pre-Registration for Conference Call
Participants can preregister for the conference by navigating to:
Participants will receive dial-in numbers to connect directly upon registration completion.
Those without internet access or unable to pre-register may dial in by calling:
PARTICIPANT DIAL IN (TOLL FREE): 1-844-763-8274
PARTICIPANT INTERNATIONAL DIAL IN: 1-647-484-8814
Review of Technical Information
The scientific and technical information in this press release has been reviewed and approved by Andrew Croal P.Eng, Chief Technical Officer for Cerrado Gold, who is a Qualified Person as defined in National Instrument 43-101.
About Cerrado
Cerrado Gold is a Toronto-based gold production, development, and exploration company focused on gold projects in South America. The Company is the 100% owner of both the producing Minera Don Nicolás and Las Calandrias mine in Santa Cruz province, Argentina. In Canada, Cerrado Gold is developing its 100% owned Mont Sorcier Iron project located outside of Chibougamou, Quebec.
In Argentina, Cerrado is maximizing asset value at its Minera Don Nicolas operation through continued operational optimization and is growing production through its operations at the Las Calandrias heap leach project. An extensive campaign of exploration is ongoing to further unlock potential resources in our highly prospective land package in the heart of the Deseado Masiff.
In Canada, Cerrado holds a 100% interest in the Mont Sorcier Iron project, which has the potential to produce a premium iron ore concentrate over a long mine life at low operating costs and low capital intensity. Furthermore, its high grade and high purity product facilitates the migration of steel producers from blast furnaces to electric arc furnaces, contributing to the decarbonization of the industry and the achievement of sustainable development goals.
For more information about Cerrado please visit our website at: www.cerradogold.com.
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
This press release contains statements that constitute "forward-looking information" (collectively, "forward-looking statements") within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that discusses predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements.
Forward-looking statements contained in this press release include, without limitation, statements regarding the business and operations of Cerrado, anticipated continued improvements in operating results and working capital position, expectations regarding the CIL plant processing lower grade stockpiles, the potential for improvement at MDN's heap leach operation, expectations regarding improvements in operating costs at MDN including AISC, additional capacity being added at the heap leach operation, the anticipated timing of completing the feasibility study at the Mont Sorcier project and the likelihood and anticipated date of closing the acquisition of Ascendant Resources Inc. In making the forward- looking statements contained in this press release, Cerrado has made certain assumptions. Although Cerrado believes that the expectations reflected in forward-looking statements are reasonable, it can give no assurance that the expectations of any forward-looking statements will prove to be correct. Known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to general business, economic, competitive, political and social uncertainties. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this press release. Except as required by law, Cerrado disclaims any intention and assumes no obligation to update or revise any forward-looking statements to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward-looking statements or otherwise.
