Alamos Gold raises production guidance over 20%; shares gain
Alamos Gold (NYSE:AGI) announced an increase in production guidance for the years 2025 to 2026 by over 20%, following the inclusion of the Magino mine in its operations.
Alamos Gold shares are 1.5% in pre-market Friday after rising 6.2% Thursday.
The company also reported a rise in capital guidance to support its high-return growth projects. The updated forecast includes the recently completed acquisition of Magino and an increased 2024 production outlook for the Mulatos District.
The company's consolidated production guidance for existing operations, excluding Magino, has risen by 4% for 2024 due to La Yaqui Grande's performance.
However, the projections for 2025 and 2026 remain consistent with the previously issued guidance in January 2024. The cost guidance for existing operations has seen a slight increase for 2024, with no changes for the following two years.
The integration of the Magino mine has led to a 13% increase in consolidated production guidance for 2024 and a significant increase of more than 20% for both 2025 and 2026. This growth is expected to enhance the company's robust profile, Alamos Gold said in a press release.
John A. McCluskey, President and Chief Executive Officer of Alamos Gold, expressed optimism about the company's future, citing the Magino acquisition as a significant contributor to their growth profile.
He highlighted the potential for synergies between Magino and Island Gold and the opportunity for long-term growth.
McCluskey stated, "Our near-term rate of production has increased by more than 20%. Longer-term we have the capacity to grow company-wide production to approximately 900,000 ounces per year, with further upside potential through future expansions of the Island Gold District."
McCluskey also emphasized the expectation of decreasing costs and the projection of substantial free cash flow growth in the coming years.
Alamos Gold stock price is up 48.9% year-to-date on the back of the rising gold prices. Bank of America told its clients on Friday to buy any dip in gold as they expect XAU/USD to continue marching toward the $3,000 handle.
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