TSX moves higher, Jan. 6-10: Kirkland Lake, Detour, Equinox, Teck

The S&P/TSX Composite Index rose 0.99% to 17,234.49 during the first full trading week of January. The S&P/TSX Global Mining Index fell 1.15% to 80.85, the S&P/TSX Global Base Metals Index lost 1.06% to 107.11, and the S&P/TSX Global Gold Index (USD) dropped 2.39% to 226.12. Spot gold climbed US$9.80 per oz. to US$1,562.10 per ounce.

Record quarterly and year-end results sent Kirkland Lake Gold up $1.17 to $58.33 per share. The company produced 279,742 oz. gold in the fourth quarter, up 21% year-on-year, with the increase driven by record production (191,893 oz.) at its Fosterville mine in Australia. Consolidated production in 2019 totalled 974,615 oz., 35% higher than 2018, with production at Fosterville of 619,366 oz. beating guidance of 570,000 to 610,000 ounces. The Macassa mine in northern Ontario produced a total of 241,297 oz. gold last year, in line with the company’s 240,000 to 250,000 oz. guidance. Its Holt complex, also in Ontario, produced 113,952 oz. compared to 127,344 oz. in 2018. The company ended 2019 with cash and equivalents of US$705 million — a 112% jump from the US$332 million it held at the end of 2018. This year Kirkland Lake is targeting production of between 950,000 and 1 million ounces.

Shares of Detour Gold climbed 83¢ to $25.68 on delivering production results in the top quartile of its guidance range at its Detour Lake mine in northeastern Ontario. The company churned out 601,566 oz. gold within its guidance range of 590,000 to 605,000 ounces. Detour improved its net debt position of US$117 million at the end of 2018 to a net cash position of US$114 million at the end of 2019, representing US$231 million in cash generated over the course of 2019.

Equinox Gold’s shares advanced 70¢ to $10.40. The company reported 2019 production of 201,000 oz. gold, achieving its 2019 guidance of 200,000 to 235,000 ounces. Its Mesquite mine in California contributed 125,700 oz. gold to the tally last year and its Aurizona mine in Brazil, which started commercial production on July 1, 2019, produced 75,300 oz. gold, including ounces poured during commissioning and ramp-up. It had an unrestricted cash balance of US$68 million at the end of 2019 and another US$10 million under a revolving credit facility. In addition to Mesquite and Aurizona, Equinox is building its Castle Mountain gold mine, also in California. Equinox says it will provide its guidance for 2020 after its proposed merger with Leagold, which will transform the company into one of the world’s top gold producers, with six producing mines and four growth projects in the Americas.

Teck Resources expanded its agreement with Ridley Terminals for steelmaking coal shipments. The agreement runs from January 2021 to December 2027 and increases contracted capacity from 3 million tonnes per year to 6 million tonnes per year, with an option to extend up to 9 million tonnes per year. The company’s B shares ended down $1.29 at $20.68.