Crocodile Gold (TSE:CRK)(TSE:CRK.DB)(OTCQX:CROCF) has bolstered its full year production forecast by about 10 percent over its previous view, after announcing operational results from its fifth straight quarter with more than 53,000 gold ounces produced.
The Toronto-based gold miner, which operates three mines in Australia, said third quarter production was 55,909 ounces, up from 54,024 ounces in the second quarter.
It also increased its guidance for the year to 220,000 to 225,000, up from its previous forecast of 200,000 to 210,000 gold ounces. The company said the updated lower end of the range also represents a 5 percent increase over Crocodile's 2013 production of 210,696 ounces.
"I am extremely pleased to announce that the company is able to increase its gold production guidance again for 2014," said president and chief executive officer, Rodney Lamond.
"This important milestone demonstrates that we are focused on the right activities to deliver consistent and sustainable results."
Indeed, in the face of harsh market conditions and a declining gold price, the company has managed to remain on top of its game by embarking on significant cost-cutting efforts, as well as by focusing on resource growth and productivity gains to build a sustainable future for each of its operating mines. In the second quarter, it improved its cost profile dramatically, with all-in sustaining cash costs -- an industry-wide metric -- falling to $1,316 per ounce sold from $1,603 in the same period of 2013.
"While the challenging gold market has impacted our revenue, we are in a very strong position to capitalize when the markets recover," said the company's CEO.
During the latest quarter, the company's Cosmo mine posted strong production of 202,290 tonnes of ore, but mined grades were lower as a result of dilution from challenging ground conditions. Crocodile said grades are expected to recover as the mine advances into the next mining block during the fourth quarter.
Its Fosterville mine maintained consistent performance, with mining grades improving slightly over the quarter as mining fronts moved into higher grade areas, the company said. Recovery rates at the site were the second highest ever for the mine, with Fosterville on track to exceed its highest annual recovery of 85.2 percent in 2013. The mine produced 28,313 ounces of gold in the third quarter, the highest quarterly ounce figure for Fosterville in three years.
The Stawell mine, which is in the process of ramping down, is still focused on the development of remnant resources in the upper levels, Crocodile said. The company is investing in limited exploration expenditures to maintain the viability of the underground operations in future quarters.
The company, which also announced the relocation of its Canadian head office to First Canadian Place in Toronto, said it finished the third quarter with cash and gold bullion of $30.5 million and working capital of about $16 million.
The Australia-focused gold miner has a combined land package in excess of 4,000 sq. km and recently invested $5.1 million to acquire what it called a "significant minority interest" in the Silvertip project in northern BC, which it sees as a high grade, near-term production asset in a stable mining region.
Crocodile's full third quarter financial results will be released in November, it said.