Lower production and higher costs relating to Sonora Gold’s (TSE) 70% owned Jamestown mine in California have forced the company to consider a financial restructuring. A 42% owned affiliate of Northgate Exploration’s (TSE) subsidiary NorthWest Gold (AMEX), Sonora said the steps are being taken to secure its short-term viability and long-term future.
Sonora recently reported a loss of $3.8 million or 19 cents per share in the three months ended Sept. 30, compared to a loss of $1.6 million or 8 cents per share in the same period last year. Third-quarter revenues dropped to $6.6 million from $8.7 million in the equivalent 1989 period.
The third-quarter results brought Sonora’s 9-month losses to $5.8 million or 28 cents a share. That compares to a loss of $1 million or 5 cents a share in the first nine months of 1989. Nine-month revenues declined to $23.7 million from $28.9 million in the year ago period.
By the end of September, Jamestown gold production had dropped substantially to 76,700 oz. from 88,400 oz. in the first nine months of 1989 due to the fact that lower- grade material is being mined from the upper portion of the Harvard open pit. Cash operating costs, meanwhile, have risen to US$332 per oz. from US$256 a year ago.
On Sept. 30, Sonora reported a deficit of $66.9 million, compared with $60 million at the same time last year. Sonora Gold (TSE) 3 months ended Sept. 30 1990 1989 Revenue $6,644 $8,727 Net earnings (loss) (3,818) (1,583)
per share (0.19) (0.08) 9 months ended Sept. 30 1990 1989 Revenue $23,779 $28,902 Net earnings (loss) (5,730) (1,033)
per share (0.28) (0.05)
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