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New Gold swings to US$26.8M profit in Q1 on forex gains despite 9% revenue fall YOY

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New Gold swings to US$26.8M profit in Q1 on forex gains despite 9% revenue fall YOY

on April 27 reported netearnings of US$26.8 million, or 5 cents per share, in the first quarter, swingingfrom a net loss of US$43.8 million, or 9 cents per share, booked in the comparable2015 period, as a result of noncash foreign exchange movements.

A US$34 millionpretax foreign exchange gain was recorded during the period, compared to a US$36million pretax foreign exchange loss last year.

Revenues, meanwhile,fell 9% on a yearly basis to US$154.5 million due to lower realized metal prices.

Despite lowerprices, New Gold's operating margin rose 5% year over year to US$72.6 million asthe US$18 million decline in the company's quarterly operating expenses more thanoffset lower revenues.

The companyproduced 90,811 ounces of gold during the period, which remained with 2015 as slightly higher outputfrom its New Afton,Mesquite and mines partially offsetplanned lower production from CerroSan Pedro.

Copper output,meanwhile, increased 10% on a yearly basis to 25.4 million pounds driven by continuedstrong operating performance at New Afton stemming from the mine's expanded grindingcapacity. Silver production of 370,300 ounces remained consistent with last year'stotal of 382,300 ounces.

In addition,the company reported consolidated all-in sustaining costs of US$758 per ounce, whichis a decrease of over US$270 per ounce relative to the first quarter of 2015. NewGold attributed the decline to certain factors, including a US$132-per-ounce fallin total cash costs and a decrease in the company's consolidated sustaining costs.

New Gold plansto produce 360,000 ounces to 400,000 ounces of gold during the year at all-in sustainingcosts of US$825 to US$865 per ounce, including total cash costs of US$435 to US$475per ounce.