PRECIOUS METALS

New Gold raises C$150M

Company seeks to enhance financial flexibility and strengthen balance sheet.

Staff Reporter
Rainy River in Ontario, Canada

Rainy River in Ontario, Canada

The company plans to issue 93.8 million shares priced at $1.60 with the proceeds to be used to strengthen its balance sheet and repay debt.

New Gold has $75.1 million in operational and development capital commitments over the next 12 months compared with $27.2 million at the end of 2018, as it continues to right-size its Rainy River mine in Ontario, Canada.

The company also needs additional liquidity to stay in the range of its debt covenants.

New Gold had liabilities of US$1.3 billion at the end of the second quarter, up from $1.2 billion at the end of 2018.

Its debts include $500 million of 6.25% senior unsecured notes due 2022, $300 million of 6.375% senior unsecured notes due 2025 and a $400 million revolving credit facility with a maturity date of August 2021.

New Gold produced 85,216 ounces of gold, 151,305oz of silver and 21.6 million pounds of copper in the second quarter, or 132,556 gold-equivalent ounces, at an all-in sustaining cost of $1,087 per ounce sold. The company expects to produce between 465,000-520,000 gold-equivalent ounces this year.

Shares in New Gold (TSX:NGD) are trading at C$1.57, valuing the company at $909 million.

 

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