• Revenue: $11.5 million for Q3 2024, down from $13.2 million in Q3 2023.
• Gold Sales: 3,063 ounces at an average realized price of $2,422 per ounce, generating $7.4 million in revenue.
• Mineralized Material Sales: 14,696 tonnes for $4.1 million in revenue.
• Net Loss Per Share: $0.10 for the quarter, compared to a $0.01 loss in the prior year period.
• Cash Position: $21.8 million at the end of the quarter, a decrease of $26 million from the previous quarter.
• Gold Production: Lower than planned due to increased groundwater ingress at Granite Creek.
• Cost of Sales: Increased by $3.2 million due to inventory write-down at Granite Creek.
• ATM Equity Program: 11.5 million shares issued for gross proceeds of $13.1 million.

• Warning! GuruFocus has detected 3 Warning Signs with IAUX.

Release Date: November 13, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• i-80 Gold Corp (IAUX) has a strong asset base with significant exploration success, particularly in Nevada, which is a favorable mining jurisdiction.
• The company has a new development plan aimed at becoming a mid-tier gold producer with a target of 400,000 to 500,000 ounces of gold per year by the early 2030s.
• The new development plan focuses on near-term cash flow generation by prioritizing advanced-stage gold projects with low capital intensity.
• The company has initiated a recapitalization plan to address balance sheet constraints and is in discussions with current and potential new lenders.
• i-80 Gold Corp (IAUX) has strengthened its management team with new hires to support its strategic goals and reduce execution risk.

Negative Points

• The company's share price has reacted negatively to the new development plan, indicating market concerns about its execution and financial health.
• i-80 Gold Corp (IAUX) is facing significant balance sheet constraints and requires recapitalization to continue operations and development plans.
• The Granite Creek underground mine is experiencing dewatering issues, negatively impacting production and costs, with resolution expected by late 2025.
• The company recorded a loss per share of $0.10 for the quarter, a significant increase from the $0.01 loss in the prior year, due to derivative instrument losses.
• There is uncertainty regarding the renewal of the toll milling agreement, which could impact the processing of refractory ore from Granite Creek.

Q & A Highlights

Q: As you look over the balance sheet, what do you see as the key risks, and how will you address these issues over the next few months or quarters? A: Richard Young, CEO: The balance sheet issues are fixable. These are Nevada projects, which are easier to fund compared to West Africa. The debt levels are modest relative to the asset base, and we are confident in putting a recapitalization plan together over the next three to six months to address the mismatch between obligations and cash flow generation.

Q: Is Orion part of the solution or part of the problem in addressing the company's financial challenges? A: Richard Young, CEO: Orion is part of the solution. They have been a valued partner with a long-term view on value. The projects took longer to develop than expected, but we are working with Orion and other partners to reschedule debt and align it with our cash flow generation.

Q: With five mines planned by 2030, was there consideration to simplifying the development plan to focus on fewer projects and reduce financing needs? A: Matthew Gili, President & COO: The three underground mines are essentially one task, as they are portal mines from existing pits. The Granite Creek open pit is a brownfield site, and Mineral Point is the last asset on the development chain. The capital intensity for the first four projects is low, allowing us to manage development sequentially.

Q: What should we expect in terms of cash consumption for the fourth quarter? A: Richard Young, CEO: We expect to continue consuming capital due to the dewatering issue at Granite Creek. Discretionary expenditures are on hold, and we are working with Orion to defer upcoming deliveries. We expect to have sufficient cash flow to move through the first quarter for a timely recapitalization.

Q: Is a debt-to-equity conversion on the table as part of the recapitalization plan? A: Richard Young, CEO: Our preference is to minimize dilution by leveraging the asset base's debt capacity. We aim to issue as little stock as possible and focus on a debt structure that aligns with our assets, avoiding a debt-to-equity conversion.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.