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Wesdome Announces 2022 Second Quarter Financial Results

T.WDO

TORONTO, Aug. 10, 2022 (GLOBE NEWSWIRE) -- Wesdome Gold Mines Ltd. (TSX: WDO) (“Wesdome” or the “Company”) today announces its second quarter financial results. All figures are stated in Canadian dollars unless otherwise noted.

Duncan Middlemiss, President and CEO commented, “At Eagle River, the one-time challenges which temporarily impacted production, such as the hoist rope manufacturing defect and the leach tank failure have since been addressed. Head grade at Eagle River in Q2 averaged 9.6 g/t, which is below the 2022 grade guidance of 12.1 -13.4 g/t Au. However, once both issues were resolved, we were able to mine and process the significantly higher-grade ore originally planned for June.

At Kiena, the supply chain challenges, which delayed delivery of the underground equipment in Q1 2022 and negatively affected our development rates, have also delayed delivery of key electrical components for the completion of the paste backfill plant. Consequently, the mining rate has been slower to ramp up, which now puts us approximately 3-4 months behind our original 2022 plan. We look forward to the completion of the paste fill plant (now expected to be commissioned in Q4 2022) to speed up our production cycle and mitigate delays.

As previously disclosed on July15, combined production in Q2 was 27,240 ounces resulting in total H1 2022 production of 52,851 ounces. Challenges such as global supply chain related delays, inflationary cost pressures, and lost productivity from COVID related absences persisted into Q2 and beyond. Subsequent to the quarter both operations were shut down for planned maintenance. During July, the Kiena hoist was shutdown for three weeks for planned refurbishment and at Eagle the mill was shutdown for two weeks for annual scheduled maintenance and thickener refurbishment.

As a result of lower production and sales than planned, both cash costs for the quarter of $1,538 (US$1,205) and AISC of $2,020 (US$1,582) were above our guidance range of $875 - $970 (US$700 - $775) for cash costs and $1,270 - $1,400 (US$1,015 - $1,125) per ounce. Free cash outflow for the quarter was $28.6 million, net of an investment of $31.2 million in Kiena, or ($0.20) per share. This is our final year of elevated growth capital (primarily at Kiena) as commercial production is expected in Q4.

In the beginning of the year, the Company set full year 2022 combined production guidance at 160,000 – 180,000 ounces. At Kiena, commercial production will be declared with the successful commissioning of the paste fill plant, which is now expected in Q4. As a result of the paste fill plant delays and the development deficit, we are revising Kiena guidance to 34,000 – 43,000 ounces. At Eagle River Mine, our recent development into the Falcon Zone has indicated that there is more grade variability than initially demonstrated from the 2021 diamond drilling, and we are forecasting lower grades in this zone for the remainder of 2022. However, this has been a zone which has already demonstrated good upside as well with our successful Falcon mining in late 2021 and we would expect this zone to demonstrate the variability associated with high grade chutes of this nature. Consequently, we are revising Eagle’s guidance to 85,000 – 95,000 ounces. As a result of the lower production and continued inflationary pressures affecting labour cost and availability, ongoing supply chain issues, and the ongoing pandemic, the company is revising both its cash and AISC costs for the year as per the below table.

2022 Guidance Initial Revised YTD 2022
Achievement
Gold production
Eagle River 95,000 – 105,000 ounces 85,000 – 95,000 ounces 37,090 ounces
Mishi 1,000 – 2,000 ounces 1,000 – 2,000 ounces 1,735 ounces
Kiena 64,000 – 73,000 ounces 34,000 – 43,000 ounces 14,026 ounces
160,000 – 180,000 ounces 120,000 – 140,000 ounces 52,851 ounces
Head grade (g/t Au)
Eagle River 12.1 – 13.4 10.5 – 11.7 10.6
Mishi 2.0 – 2.5 2.9 – 3.3 3.3
Kiena 10.6 – 11.8 8.6 – 9.5 9.3
Cash cost per ounce 1 $875 - $970
(US$700 – US$775)
$1,260 - $1,390
(US$980 – US$1085)
$1,412
(US$1,111)
AlSC per ounce 1 $1,270 - $1,400
(US$1,015 – US$1,125)
$1,765 - $1,950
(US$1,370 – US$1,520)
$1,851
(US$1,456)


“The Company is continuing its aggressive exploration and drilling program for 2022. We are pleased with the recent expansion of the high grade A Zones and Footwall Zones as well as the discovery of the South Limb zone at Kiena. Similarly at Eagle River, the surface and underground drilling has continued to expand known zones such as 300E and Falcon 7 and identified new areas of mineralization both within the mine diorite and surrounding volcanic rocks. The continued discovery of new mineralization demonstrates the upside exploration potential at both sites.”

Key operating and financial highlights of the Q2 2022 results include:

  • Gold production of 27,240 ounces, including 8,914 Kiena pre-commercial ounces, is a 10% decrease over the same period of the previous year (Q2 2021: 30,375 ounces):
    • Eagle River Underground milled 59,964 tonnes at a head grade of 9.6 grams per tonne for 17,756 ounces produced, a 40% decrease over the same period in the previous year (Q2 2021: 29,836 ounces).
    • Mishi Open Pit milled 7,685 tonnes at a head grade of 2.8 grams per tonne for 570 ounces produced (Q2 2021: 539 ounces).
    • Kiena milled 26,478 tonnes at a head grade of 10.6 grams per tonne for 8,914 pre-commercial ounces produced.
  • Revenue of $61.9 million, a 3% decrease over the same period of the previous year (Q2 2021: $63.9 million).
  • Ounces sold were 26,000 at an average sales price of $2,380/oz (Q2 2021: 28,500 ounces at an average price of $2,239/oz).
  • Cash margin1 of $21.9 million, a 46% decrease over the same period of the previous year (Q2 2021: $40.6 million).
  • Operating cash flows decreased by 55% to $12.1 million or $0.08 per share1 as compared to $26.9 million or $0.19 per share for the same period in 2021.
  • Free cash outflow of $28.6 million, net of an investment of $31.2 million in Kiena, or ($0.20) per share1 (Q2 2021: free cash outflow of $9.1 million or ($0.07) per share1).
  • Net loss of $14.3 million or ($0.10) per share (Q2 2021: Net income - $84.9 million or $0.63 per share) and Net loss (adjusted)1 of $5.5 million or ($0.04) per share (Q2 2021: $20.6 million or $0.15 per share)
  • Cash position at the end of the quarter of $23.5 million.
  • Cash costs1 of $1,538/oz or US$1,205/oz, an 89% increase over the same period in 2021 (Q2 2021: $814/oz or US$663/oz);
  • AISC1 increased by 63% to $2,020/oz or US$1,582/oz (Q2 2021: $1,240 or US$1,009 per ounce) due to lower ounces sold and increased corporate and general expenses.

    1. Refer to the Company’s 2021 Annual Management Discussion and Analysis section entitled “Non-IFRS Performance Measures” for the reconciliation of these non-IFRS measurements to the consolidated financial statements.



Production and
Exploration Highlights
Achievements
Eagle River Complex
  • Q2 2022 Eagle River underground ore production decreased by 40% from Q2 2021 to 17,756 ounces of gold due to a manufacturing defect on a new hoist rope, resulting in two weeks of lower productivity as ore was trucked to surface, while a new rope was sourced, and one of the leach tanks at the mill, which was previously scheduled to be replaced later this year, failed in mid-June, impacting nearly one week of mill production. Head grade at Eagle River in Q2 2022 averaged 9.6 g/t, which is below the 2022 grade guidance of 12.1 -13.4 g/t Au. Once both issues were resolved, we were able to mine and process the significantly higher grade ore planned for June.
  • Q2 2022 cash cost of $1,395 (US$1,093) per ounce of gold sold1 increased by 71% or $580 per ounce from Q2 2021 due to a 30% decrease in ounces sold, and a 14% increase in overall aggregate site operating costs resulting from increased operating development, general maintenance, and inflationary pressures, driven by higher labour costs and an increase in commodity inputs, including higher fuel and energy costs.
  • Q2 2022 AISC of $1,940 (US$1,519) per ounce of gold sold1 increased by 57% or $701 per ounce from Q2 2021 due to a 30% decrease in ounces sold and a 14% increase in overall aggregate site operating costs resulting from increased operating development, general maintenance, and inflationary pressures, driven by higher labour costs and an increase in commodity inputs, including higher fuel and energy costs.
  • Generated a cash margin in Q2 2022 of $19.7 million compared to $40.6 million in Q2 2021 due to the 30% decrease in ounces sold, the 14% increase in overall aggregate site operating costs; partially offset by a 6% higher average realized Canadian gold price of $2,382 per ounce (Q2 2021 - $2,239 per ounce).
  • Definition drilling is focused at the Falcon Zone and 300 E Zone. A record Inferred Resource inventory provides a platform for a potential increase in Reserve replacement for 2022.Definition and expansion drilling has continued to return high grade gold mineralization from the Falcon 7 zone with 90.2 g/t Au over 4.9 m core length (21.2 g/t Au capped, 3.4 m true width) and 87.1 g/t Au over 6.6 m core length. The discovery and initial production from the Falcon 7 Zone reaffirms the potential of the surrounding volcanic rocks to host sizeable deposits of gold mineralization and remains a focus for drilling. New development is being completed along the 355 m Level extending 400 m west of the mine diorite and will provide platforms to test for gold mineralization further along strike, and for parallel zones where surface exploration has returned encouraging results from a region of the mine that has historically been given very little attention.
  • Meanwhile, underground exploration drilling is being completed down plunge at the 300E, 711 and 811 zones that remain open down plunge. Additional underground exploration is ongoing further to the east of the current mining areas, in the east-central area of the mine, to test for parallel zones north of the historic 8 and 6 Zones.
  • Surface drilling is ongoing with one drill to test the up plunge extension of the Falcon 7 zone near surface and other zones along this trend further to the west. The recent drilling has intersected several well altered and mineralized areas with VG, which is interpreted to be the up plunge extension of the Falcon 7 zone.
  • Drilling within the central portion of the mine diorite has intersected the interpreted eastern extension of the 7 zone. Several holes in this area have intersected VG and in the future will be better drilled from underground.
  • Also, drilling within the volcanic rocks east of the mine diorite approximately 150 m down dip and the previously mined 2 Zone intersected quartz veining and alteration.
Kiena
  • Generated $2.1 million in cash margin despite the high cash costs of $2,018 (US$1,581) per ounce of gold sold1 due to low pre-commercial production levels. The global supply chain challenges, which delayed delivery of the underground equipment in Q1 2022, have also delayed delivery of key electrical components for the completion of the paste backfill plant. Consequently, the mining rate has been slower to ramp up, which now puts us approximately 3-4 months behind our original 2022 plan. We look forward to the completion of the paste fill plant (now expected to be commissioned in Q4 2022) to speed up our production cycle and mitigate delays.
  • Most recently, underground exploration drilling at the Kiena Deep A Zones area has discovered a new mineralized interval (hole 6752W10) located 100 metres below the known limit of A zone resource returning 13.9 g/t Au over 83.2 m core length (9.9 g/t Au capped) (see June 1, 2022 press release).
  • Recent drilling has discovered the lateral extension of the A Zone along the South limb of the fold returning 16.5 g/t au over 4.7 m and 17.8 g/t Au over 4.2 m. The discovery of the South limb of the A Zone could significantly add to the resource base.
  • Additionally, underground drills have been moved onto the 33 level to test historic zones and encouraging drill results further to the southeast along strike from the Kiena mine.

    Surface drilling is focused on discovering new zones at the Shawkey and Bourgo zones, where previous drilling has returned encouraging results, and defining and extending the historical Presqu’ile and Shawkey Dubuisson areas located northwest and southeast of the Kiena Mine, respectively. These areas are close to the mine infrastructure and represent a potential additional source of ore for the Kiena mill.


Wesdome Gold Mines 2022 Second Quarter Financial Results conference call:

August 11, 2022 at 10:00 am ET. Registration is required.

Registration Link:https://register.vevent.com/register/BI6fabe85cad5f48ea97a0b7087d4cb9cb

Webcast link:
https://edge.media-server.com/mmc/p/8ft6b4im

The webcast can also be accessed under the News and Events section of the Company’s website (www.wesdome.com)

Technical Disclosure

The technical content of this release has been compiled, reviewed and approved by Frederic Langevin, Eng, Chief Operating Officer, a "Qualified Person" as defined in National Instrument 43-101 -Standards of Disclosure for Mineral Projects.

COVID-19

The health and safety of our employees, contractors, vendors, and consultants is the Company’s top priority. In response to the COVID-19 outbreak, Wesdome has adopted all public health guidelines regarding safety measures and protocols at all of its mine operations and corporate office. These protocols are still in place at all sites despite the loosening of some provincial public health guidelines. In addition, our internal COVID-19 Taskforce continues to monitor developments and implement policies and programs intended to protect those who are engaged in business with the Company.

Through care and planning, to date the Company has successfully maintained operations, however there can be no assurance that this will continue despite our best efforts with the emergence of new, highly contagious variants such as Omicron. To date, the company has been impacted by this most recent variant outbreak, with employees at both operations and corporate office becoming infected which may negatively impact our ability to maintain projected timelines and objectives. Consequently, the Company’s actual future production and production guidance is subject to higher levels of risk than usual. We are continuing to closely monitor the situation and will provide updates as they become available.

ABOUT WESDOME
Wesdome is a Canadian focused gold producer with two high grade underground assets, the Eagle River mine in Ontario and the recently re-started Kiena mine in Quebec. The Company also retains meaningful exposure to the Moss Lake gold deposit in Ontario through its equity position in Goldshore Resources Inc. The Company’s primary goal is to responsibly leverage this operating platform and high-quality brownfield and greenfield exploration pipeline to build Canada’s next intermediate gold producer. Wesdome trades on the Toronto Stock Exchange under the symbol “WDO,” with a secondary listing on the OTCQX under the symbol “WDOFF.”

For further information, please contact:

Duncan Middlemiss
President and CEO
416-360-3743 ext. 2019
duncan.middlemiss@wesdome.com
or Lindsay Carpenter Dunlop
VP Investor Relations
416-360-3743 ext. 2025
lindsay.dunlop@wesdome.com
220 Bay St, Suite 1200
Toronto, ON, M5J 2W4
Toll Free: 1-866-4-WDO-TSX
Phone: 416-360-3743, Fax: 416-360-7620
Website: www.wesdome.com


This news release contains “forward-looking information” which may include, but is not limited to, statements with respect to the future financial or operating performance of the Company and its projects. Often, but not always, forward-looking statements can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, or “believes” or variations (including negative variations) of such words and phrases, or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements contained herein are made as of the date of this press release and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update forward-looking statements if circumstances, management’s estimates or opinions should change, except as required by securities legislation. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements. The Company has included in this news release certain non-IFRS performance measures, including, but not limited to, mine operating profit, mining and processing costs and cash costs. Cash costs per ounce reflect actual mine operating costs incurred during the fiscal period divided by the number of ounces produced. These measures are not defined under IFRS and therefore should not be considered in isolation or as an alternative to or more meaningful than, net income (loss) or cash flow from operating activities as determined in accordance with IFRS as an indicator of our financial performance or liquidity. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company's performance and ability to generate cash flow.



Wesdome Gold Mines Ltd.
Summarized Operating and Financial Data
(Unaudited, expressed in thousands of Canadian dollars, except per share and per unit amounts and otherwise indicated)

Three Months Ended Six Months Ended
June 30, June 30,
2022 2021 2022 2021
Operating data
Milling (tonnes)
Eagle River 59,964 63,057 113,181 116,597
Mishi 7,685 9,347 19,558 26,566
Kiena 26,478 - 47,640 -
Throughput 2 94,127 72,404 180,379 143,163
Head grades (g/t)
Eagle River 9.6 15.1 10.6 14.1
Mishi 2.8 2.4 3.3 2.4
Kiena 10.6 - 9.3 -
Recovery (%)
Eagle River 95.6 97.4 96.6 97.3
Mishi 81.2 76.1 83.6 81.9
Kiena 98.5 - 98.3 -
Production (ounces)
Eagle River 17,756 29,836 37,090 51,232
Mishi 570 539 1,735 1,707
Kiena 8,914 - 14,026 -
Total gold produced2 27,240 30,375 52,851 52,939
Total gold sales (ounces) 4 26,000 28,500 54,000 50,957
Eagle River Complex (per ounce of gold sold) 1
Average realized price $ 2,382 $ 2,239 $ 2,389 $ 2,232
Cash costs 1,395 814 1,330 930
Cash margin $ 987 $ 1,425 $ 1,059 $ 1,302
All-in Sustaining Costs 1 $ 1,940 $ 1,240 $ 1,858 $ 1,353
Mine operating costs/tonne milled 1 $ 387 $ 324 $ 386 $ 330
Average 1 USD → CAD exchange rate 1.2768 1.2282 1.2715 1.247
Cash costs per ounce of gold sold (US$) 1 $ 1,093 $ 663 $ 1,046 $ 745
All-in Sustaining Costs (US$) 1 $ 1,519 $ 1,009 $ 1,461 $ 1,085
Kiena Mine (per ounce of gold sold) 1
Average realized price $ 2,372 $ - $ 2,355 $ -
Cash costs 3, 5 2,018 - 1,622 238
Cash margin $ 354 $ - $ 733 $ (426 )
All-in Sustaining Costs 1, 3, 5 $ 2,284 $ - $ 1,834 $ 238
Mine operating costs/tonne milled 1 $ 557 $ - $ 567 $ -
Average 1 USD → CAD exchange rate 1.2768 1.2282 1.2715 1.247
Cash costs per ounce of gold sold (US$) 1 $ 1,581 $ - $ 1,276 $ 191
All-in Sustaining Costs (US$) 1 $ 1,789 $ - $ 1,442 $ 191
Financial Data
Cash margin 1 $ 21,873 $ 40,590 $ 52,215 $ 62,366
Net income $ (14,331 ) $ 84,937 $ (7,280 ) $ 92,040
Net income adjusted 1 $ (5,481 ) $ 20,630 $ 1,570 $ 27,733
Earnings before interest, taxes, depreciation and amortization 1 $ 8,844 $ 37,454 $ 29,494 $ 56,116
Operating cash flow $ 12,101 $ 26,875 $ 41,994 $ 48,908
Free cash flow $ (28,576 ) $ (9,131 ) $ (35,372 ) $ (9,032 )
Per share data
Net income $ (0.10 ) $ 0.61 $ (0.05 ) $ 0.66
Adjusted net income 1 $ (0.04 ) $ 0.15 $ 0.01 $ 0.20
Operating cash flow 1 $ 0.08 $ 0.19 $ 0.30 $ 0.35
Free cash flow 1 $ (0.20 ) $ (0.07 ) $ (0.25 ) $ (0.06 )
  1. Refer to the Company’s 2021 Annual Management Discussion and Analysis section entitled “Non-IFRS Performance Measures” for the reconciliation of these non-IFRS measurements to the consolidated financial statements.
  2. Totals for tonnage and gold ounces may not add due to rounding.
  3. YTD 2021 includes a $0.4 million charge for product inventory costs from the sale of 1,793 ounces of gold from the Kiena bulk sample, which was processed in Q4 2020.
  4. YTD 2021 includes 1,793 ounces of gold from the Kiena bulk sample, which was processed in Q4 2020
  5. In determining the Cash cost per ounce and AISC per ounce, the total ounces sold includes 1,793 ounces of gold from the Kiena bulk sample, which was processed in Q4 2020 and sold in Q1 2021.



Wesdome Gold Mines Ltd.
Condensed Interim Statements of Financial Position
(Unaudited, expressed in thousands of Canadian dollars)

As at
June 30, 2022
As at
December 31, 2021
Assets
Current
Cash and cash equivalents $ 23,516 $ 56,764
Receivables and prepaids 8,343 13,793
Inventories 22,864 17,918
Income and mining tax receivable 1,438 -
Share consideration receivable - 4,560
Total current assets 56,161 93,035
Restricted cash 1,151 657
Deferred financing costs 590 758
Mining properties, plant and equipment 205,390 212,394
Mines under development 272,699 214,089
Exploration properties 1,139 1,139
Marketable securities 960 1,860
Share consideration receivable 6,117 10,729
Investment in associate 9,414 19,058
Total assets $ 553,621 $ 553,719
Liabilities
Current
Payables and accruals $ 53,325 $ 40,093
Income and mining tax payable - 5,490
Current portion of lease liabilities 7,371 7,789
Total current liabilities 60,696 53,372
Lease liabilities 5,036 6,786
Deferred income and mining tax liabilities 77,644 77,195
Decommissioning provisions 18,589 21,191
Total liabilities 161,965 158,544
Equity
Equity attributable to owners of the Company
Capital stock 192,753 187,911
Contributed surplus 5,678 5,859
Retained earnings 194,365 201,645
Accumulated other comprehensive loss (1,140 ) (240 )
Total equity attributable to owners of the Company 391,656 395,175
Total liabilities and equity $ 553,621 $ 553,719



Wesdome Gold Mines Ltd.
Condensed Interim Statements of Income and Comprehensive Income
(Expressed in thousands of Canadian dollars except for per share amounts)

Three Months Ended Six Months Ended
June 30, June 30,
2022 2021 1 2022 2021 1
Revenues $ 61,931 $ 63,881 $ 128,625 $ 109,854
Cost of sales (51,374 ) (29,774 ) (96,080 ) (60,038 )
Gross profit 10,557 34,107 32,545 49,816
Other expenses
Corporate and general 3,221 2,841 6,596 5,232
Stock-based compensation 1,554 1,203 1,630 1,513
Exploration and evaluation 4,213 - 7,169 -
Reversal of impairment charges - (58,563 ) - (58,563 )
Impairment charge on exploration properties - 3,113 - 3,113
Gain on disposal of mining equipment (10 ) - (12 ) -
Total other expenses 8,978 (51,406 ) 15,383 (48,705 )
Operating income 1,579 85,513 17,162 98,521
Gain on sale of Moss Lake exploration properties - 34,330 - 34,330
Impairment of investment in associate (11,800 ) - (11,800 ) -
Fair value adjustment on share consideration receivable (3,605 ) 1,521 (5,839 ) 1,521
Interest expense (316 ) (271 ) (579 ) (530 )
Accretion of decommissioning provisions (208 ) (124 ) (379 ) (234 )
Share of loss of associate (131 ) (89 ) (543 ) (89 )
Loss on dilution of ownership (429 ) - (634 ) -
Other income (expense) 322 (400 ) 57 (703 )
(Loss) income before income and mining taxes (14,588 ) 120,480 (2,555 ) 132,816
Income and mining tax expense
Current 1,788 4,250 4,276 5,346
Deferred (2,045 ) 31,293 449 35,430
Total income and mining tax expense (257 ) 35,543 4,725 40,776
Net (loss) income $ (14,331 ) $ 84,937 $ (7,280 ) $ 92,040
Other comprehensive loss
Change in fair value of marketable securities (1,410 ) - (900 ) -
Total comprehensive (loss) income $ (15,741 ) $ 84,937 $ (8,180 ) $ 92,040
(Loss) Earnings per share
Basic $ (0.10 ) $ 0.61 $ (0.05 ) $ 0.66
Diluted $ (0.10 ) $ 0.60 $ (0.05 ) $ 0.65
Weighted average number of common shares (000s)
Basic 142,478 139,754 142,146 139,587
Diluted 142,478 142,630 142,146 142,454
  1. Q2 2021 has been restated to correct an error in the valuation of the share consideration receivable related to the sale of the Moss Lake Project which closed on May 31, 2021. The proceeds have been restated to $44.7 million from $49.5 million, which has decreased the gain on sale of the Moss Lake properties to $30.2 million (net of tax of $4.1 million) from $34.6 million (net of tax of $4.5 million). The Q2 2021 net income has decreased by $2.9 million, which includes a $1.5 million gain resulting from the mark-to-market of the share consideration receivable. Basic earnings per share for Q2 2021 changed from $0.63 to $0.61 per share and basic earnings per share for Q2 YTD 2021 changed from $0.68 to $0.66 per share.



Wesdome Gold Mines Ltd.
Condensed Interim Statements of Changes in Equity
(Unaudited, expressed in thousands of Canadian dollars)

Accumulated
Other
Capital Contributed Retained Comprehensive Total
Stock Surplus Earnings 1 Loss Equity 1
Balance, December 31, 2020 $ 179,540 $ 6,472 $ 70,357 $ - $ 256,369
Net income for the period ended
June 30, 2021 - - 92,040 - 92,040
Exercise of options 1,231 - - - 1,231
Value attributed to options exercised 587 (587 ) - - -
Value attributed to RSUs exercised 786 (786 ) - - -
Stock-based compensation - 1,513 - - 1,513
Balance, June 30, 2021 $ 182,144 $ 6,612 $ 162,397 $ - $ 351,153
Balance, December 31, 2021 $ 187,911 $ 5,859 $ 201,645 $ (240 ) $ 395,175
Net loss for the period ended
June 30, 2022 - - (7,280 ) - (7,280 )
Other comprehensive loss - - - (900 ) (900 )
Exercise of options 3,031 - - - 3,031
Value attributed to options exercised 1,173 (1,173 ) - - -
Value attributed to RSUs exercised 638 (638 ) - - -
Stock-based compensation - 1,630 - - 1,630
Balance, June 30, 2022 $ 192,753 $ 5,678 $ 194,365 $ (1,140 ) $ 391,656
  1. See footnote in the condensed interim statements of income and comprehensive income for details of the restatement in Q2 2021.



Wesdome Gold Mines Ltd.
Condensed Interim Statements of Cash Flows
(Unaudited, expressed in thousands of Canadian dollars)

Three months ended June 30, Six months ended June 30,
2022 2021 1 2022 2021 1
Operating Activities
Net (loss) income $ (14,331 ) $ 84,937 $ (7,280 ) $ 92,040
Depreciation and depletion 11,316 6,483 19,670 12,550
Stock-based compensation 1,554 1,203 1,630 1,513
Accretion of decommissioning provisions 208 124 379 234
Deferred income and mining tax expense (2,045 ) 31,293 449 35,430
Amortization of deferred financing cost 85 119 169 224
Interest expense 316 271 579 530
Reversal of impairment charges - (58,563 ) - (58,563 )
Gain on sale of Moss Lake exploration properties - (34,330 ) - (34,330 )
Impairment charge on exploration properties - 3,113 - 3,113
Gain on disposal of mining equipment (10 ) - (12 ) -
Impairment of investment in associate 11,800 - 11,800 -
Fair value adjustment on share consideration receivable 3,605 (1,521 ) 5,839 (1,521 )
Share of loss of associate 131 89 543 89
Loss on dilution of ownership 429 - 634 -
Foreign exchange gain on borrowings (77 ) (50 ) (109 ) (79 )
Net changes in non-cash working capital 4,642 (1,131 ) 18,906 3,039
Mining and income tax paid (5,522 ) (5,162 ) (11,203 ) (5,361 )
Net cash from operating activities 12,101 26,875 41,994 48,908
Financing Activities
Proceeds from revolving credit facility 14,956 - 14,956 -
Repayment of revolving credit facility (14,810 ) - (14,810 ) -
Exercise of options 264 910 3,031 1,231
Deferred financing costs - (95 ) - (334 )
Repayment of lease liabilities (2,345 ) (1,884 ) (4,431 ) (3,400 )
Interest paid (316 ) (271 ) (579 ) (530 )
Net cash used in financing activities (2,251 ) (1,340 ) (1,833 ) (3,033 )
Investing Activities
Additions to mining properties (7,132 ) (10,050 ) (13,322 ) (17,873 )
Additions to mines under development (31,200 ) (12,704 ) (59,613 ) (13,400 )
Additions to exploration properties - (11,368 ) - (23,267 )
Cash proceeds on sale of Moss Lake, net of transaction costs - 11,762 - 11,762
Funds held against standby letter of credit (494 ) - (494 ) -
Proceeds on disposal of mining equipment 20 - 20 -
Net changes in non-cash working capital - 740 - 1,222
Net cash used in investing activities (38,806 ) (21,620 ) (73,409 ) (41,556 )
(Decrease) increase in cash and cash equivalents (28,956 ) 3,915 (33,248 ) 4,319
Cash and cash equivalents - beginning of period 52,472 63,884 56,764 63,480
Cash and cash equivalents - end of period $ 23,516 $ 67,799 $ 23,516 $ 67,799
Cash and cash equivalents consist of:
Cash $ 23,516 $ 67,799 $ 23,516 $ 67,799
$ 23,516 $ 67,799 $ 23,516 $ 67,799
  1. See footnote in the condensed interim statements of income and comprehensive income for details of the restatement in Q2 2021.


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