Record output for Glamis

Vancouver — Glamis Gold (GLG-T) lowered costs while ramping up production in 2002.

The Reno-based company made a profit of US$13.7 million (or US14 per share) for the year, compared to US$4.8 million (US7 per share) in 2001.

For the fourth quarter, income amounted to US$4.7 million (US4 per share), compared with US$2.8 million (US4 per share) in 2001.

“Glamis had a record year in 2002,” says President Kevin McArthur. “We surpassed our production targets and our total cash cost projections and, in the process, doubled our earnings per share and increased cash flow from operations by 83%.”

Glamis produced 251,919 oz. at total cash cost of US$160 per oz. in 2002, compared with 230,065 oz. at US$172 per oz. in 2001. Operating cash flow surged to US$33.8 million (before working capital changes and reclamation expenditures), compared with US$18.5 million in 2001.

Gold sales for the year totalled US$80.8 million, compared with US$64.3 million in 2001. During the fourth quarter, the company sold 68,784 oz. at US$326 per oz., compared with sales of 69,600 oz. at US$277 per oz. a year earlier.

The San Martin mine in Honduras was the star performer, cranking out 129,435 oz. gold during the year, compared to 114,216 oz. in 2001. Tht total cash cost of producing an ounce of the yellow metal rang in at US$106, compared with US$120 in the previous year. At the end of 2002, reserves at San Martin stood at 34 million tonnes grading 0.75 gram gold per tonne, or 803,725 contained oz.

Last year, Glamis’s 66.7%-owned Marigold operation in Nevada added 55,550 oz. gold at a total cash cost of US$180 per oz., compared with 56,525 oz. at US$179 per oz. in 2001. Production in 2002 was constrained by a prestripping program in advance of the Marigold expansion. The company did start to see the benefits of the expansion in the fourth quarter, when production came in at 22,878 oz. at a total cash cost of US$138 per oz, compared with 11,600 oz. at US$221 per oz. a year earlier.

At the end of 2002, Marigold held 52.7 million tonnes grading 0.81 gram gold, or 1.4 million contained oz.

“During the year, we made excellent progress in advancing the Marigold expansion project, which will result in substantially higher gold production and reduced total cash costs in subsequent years,” says McArthur.

At the nearly depleted Rand mine, in California, production increased to 66,934 oz. gold at a total cash cost of US$247 per oz., compared with 59,324 oz. at US$265 per oz. in 2001. Mining was completed in January, though leaching will continue for another two years.

Farther afield, at the El Sauzal project in Mexico, Glamis completed a feasibility study that envisions production of 190,000 oz. per year 10 years.

Environmental permitting is under way, and construction is to begin in the fourth quarter of 2003. Startup is planned for early 2005. Reserves at El Sauzal stand at 20.5 million tonnes grading 3.05 gram gold, equvalent to just over 2 million contained ounces.

At the Marlin project in Guatemala, the company nearly tripled the mineral resource to more than 4 million oz. gold-equivalent, with 2.8 million oz. in the measured and indicated resource categories.

“We have made excellent progress in furthering our El Sauzal gold development project in Mexico and transformed our Marlin property in Guatemala into a major gold discovery,” says McArthur.