Steppe Gold’s $37.3M Revenue In Q3 2024 Undermined By Cost Disparities
Steppe Gold Ltd. (TSX: STGO) reported its financial results for the third quarter of 2024, generating total revenue of $37.3 million in the third quarter, a 31% increase from $28.5 million in the second quarter of 2024 and a substantial year-over-year rise from $23.1 million in Q3 2023.
This improvement was driven by higher production volumes, particularly from Boroo Gold, and favorable realized gold prices. Boroo Gold contributed $27.4 million in Q3 revenue, or 73% of the company’s total for the quarter. Steppe Gold’s revenue from August 1 to September 30, 2024, comparatively totaled $9.9 million.
Boroo Gold sold 12,607 ounces of gold in the third quarter at an average realized price of $2,167 per ounce, up slightly from $2,125 in the prior quarter. This price is well above the $1,975 average realized price in Q3 2023. However, Steppe’s other operations achieved a much higher average, selling 3,769 ounces of gold at an average realized price of $2,623 per ounce during the quarter.
Boroo Gold’s all-in sustaining cost for Q3 was $1,095 per ounce, down from $1,180 in the prior quarter. In contrast, Steppe Gold’s standalone AISC for the quarter was $1,610 per ounce, well above Boroo’s and representing an increase from $1,550 in Q2 2024.
The company’s operating income before depreciation and depletion for the quarter was $21.5 million, a 22% improvement from $17.6 million in the second quarter of 2024. Year-over-year, this metric more than doubled from $10.3 million in Q3 2023, primarily due to the inclusion of Boroo Gold’s operations. EBITDA for the quarter reached $19.5 million, up from $16.8 million in the previous quarter and $8.1 million in Q3 2023.
The strategic acquisition of Boroo Gold has undoubtedly been impactful, contributing not only significant revenue but also operational expertise that could inform improvements at Steppe Gold’s legacy operations. CEO Bataa Tumur-Ochir emphasized the acquisition’s impact, stating, “Boroo Gold accelerates our transformation into a multi-asset mining company, providing immediate cash flow and a solid foundation for growth.”
Steppe Gold last traded at $0.69 on the TSX.
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