Eldorado Gold flags Omicron hit to quarterly production

Canada’s Eldorado Gold (TSX: ELD; NYSE: EGO) hasn’t altered its 2022 production guidance of 460,000-490,000 oz. of gold untouched, despite reporting that higher-than-expected absenteeism due to the Covid-19 Omicron variant hit output in the first quarter. 

Gold production in the first three months of the year fell to 93,209 oz., from 111,742 oz. in the same period last year and from 122,582 ounces in the last quarter of 2021, as labour shortages triggered by the onset of Omicron affected operations in all the countries where the company operates.  

At Lamaque, Eldorado’s first gold mine in Canada, lack of sufficient workforce delayed the underground development of high-grade stopes, which led to lower-than-planned gold grades and tonnage. The situation was solved by March, prompting the company to keep guidance for the mine unchanged.

Weather and power issues also affected the company’s operations in Turkey and Greece. 

BMO Capital Market’s Brian Quast said the production was “well below” BMO’s forecast of 107,500 oz., but he maintained the bank’s $18 target price.

Eldorado, which also has operations in Romania, has increased focus on the domestic market in recent years. It bought Quebec explorer QMX Gold (TSXV: QMX) in early 2021 and acquired a 11.5% stake in Probe Metals (TSXV: PRB), another local explorer, in July. 

The Vancouver-based miner is scheduled to release its first quarter earnings after market close on Apr. 28, and will host a conference call on Apr. 29.