TORONTO, ONTARIO -- (Marketwired) -- 08/12/13 -- Lake Shore Gold Corp. (TSX: LSG) (NYSE MKT: LSG) ("Lake Shore Gold" or the "Company") today announced financial and operating results for the second quarter of 2013. Key highlights of the results include:
-- Record gold poured of 31,800 ounces in the second quarter of 2013, with record gold production of 30,800 ounces and gold sales totaling 27,600 ounces at an average sale price of US$1,409 ($1,441) per ounce.-- Cash operating cost per ounce(1) sold during the second quarter of 2013 averaged US$908, including US$28 per ounce related to royalties. Excluding inventory movements involving higher cost ounces from previous periods, cash operating cost per ounce(1) sold averaged US$798 during the second quarter of 2013 before royalties.-- Total all-in sustaining cost ("AISC")(2) during the second quarter and first six months of 2013 of US$1,257 and US$1,398, respectively.-- Capital investment during first six months of 2013 totaling $66 million, representing close to three-quarters of target capital investment for the year.-- Excellent progress advancing mill expansion towards completion, with commissioning starting near end of July and new crushing/grinding circuit now operational and ramping to 3,000 tonnes per day.-- Earnings from mine operations for the second quarter and the first six months of 2013 of $1.8 million and $5.7 million respectively, compared to $3.2 million and $4.5 million, respectively, in same periods in 2012. Year-to-date increase reflects 36% growth in commercial sales, which more than offset impact of lower gold prices.-- 2013 guidance maintained, including production of between 120,000 and 135,000 ounces of gold, cash operating cost per ounce(1) sold in a range of US$800 - US$875 and capital investment of approximately $90 million.
Tony Makuch, President and CEO of Lake Shore Gold, commented: "We are very encouraged by our results in the second quarter, which included record production, improved unit operating costs and excellent progress advancing our mill expansion towards completion. Commissioning of the expansion commenced late last month with our new crushing and grinding circuit now ramping up towards the new design capacity of over 3,000 tonnes per day, which is expected by early September. When we achieve this level of throughput, our production will increase, our unit operating costs will improve and our capital requirements will decline dramatically. At that point, we expect our AISC(2) to improve to around US$1,000 per ounce, with the Company on track to generate net free cash flow during the fourth quarter at current gold prices.
"Looking at our cost performance more closely, we were particularly pleased with the progress that was made in the second quarter. Higher throughput levels and the impact of cost management initiatives helped us to pull our costs down with mining costs during the quarter averaging $74 per tonne, trucking costs averaging $5 per tonne and processing costs averaging $22 per tonne. On an ounces sold basis, our cash operating costs(1) were increased by inventory movements that included higher costs of production from previous periods capitalized in opening inventory balances. Excluding inventory movements and royalty payments, cash operating cost per ounce(1) for the second quarter averaged US$795 per ounce. Given that we produced 3,200 ounces more than we sold during the quarter, unit costs on ounces produced would be even lower. Our AISC(2) in the first half of 2013 averaged US$1,398 per ounce and, as indicated above, this number is expected to improve following completion of our mill expansion."