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Feb 28, 2022
Novagold Q1 2022 Earnings Report
Announced first quarter financial results and provided an update on the Donlin Gold project.
Key Takeaways
NOVAGOLD reported a net loss of $10.0 million for the first quarter of 2022, compared to a net loss of $8.0 million for the comparable period in 2021. The increase in net loss is primarily attributed to the earlier commencement of the Donlin Gold drilling program in 2022, and reduced accretion income. The Company's treasury remained strong with $155 million in cash and term deposits as of February 28, 2022.
Activities commenced early in the year with the camp opening in January to prepare the site for the largest drilling program in ten years.
The proposed budget for Donlin Gold LLC (100 percent) in 2022 is anticipated to be $60 million (of which NOVAGOLD’s portion is 50 percent).
NOVAGOLD’s treasury remained strong with $155 million in cash and term deposits as of February 28, 2022.
An additional payment from Newmont of $25 million comes due in 2023 related to the sale of NOVAGOLD’s 50 percent interest in the Galore Creek project in 2018.
Forward Guidance
NOVAGOLD anticipates spending approximately $46 million in 2022, with the primary goals to continue to advance the Donlin Gold project toward a construction decision, maintain stakeholder support, promote a strong safety culture, and manage the Company treasury effectively.
Positive Outlook
- Continue to advance the Donlin Gold project toward a construction decision
- Maintain or increase support for Donlin Gold among the project’s stakeholders
- Promote a strong safety, sustainability, and environmental culture
- Maintain a favorable reputation for NOVAGOLD, its governance practices and its project among shareholders
- Manage the Company treasury effectively and efficiently
Challenges Ahead
- Need to obtain additional permits and governmental approvals
- The timing and likelihood of obtaining and maintaining permits necessary to construct and operate
- The need for additional financing to explore and develop properties and availability of financing in the debt and capital markets
Historical Earnings Impact
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Avg. Return Before/After Earnings
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