WDO:TSX

TORONTO , Nov. 6, 2014 /CNW/ - Wesdome Gold Mines Ltd. (WDO.TO) today announces its financial and operational results for the third quarter and first nine months of 2014. All figures are in Canadian dollars unless stated otherwise.

Mr. Rolly Uloth , President and CEO commented, "I am pleased to report that the third quarter is the fourth consecutive quarter the Company has generated positive free cash flow, building our cash position to $10.7 million from $8.3 million in the previous quarter. Some profits were used to be active on our Normal Course Issuer Bid, where during the quarter 203,500 shares were bought back and retired. Over the last year, the Company has been expanding its milling capacity and reliability, and the benefits of these programs are beginning to take effect. During the third quarter, throughput increased by 54% and production based cash costs on a per tonne basis decreased by 33%. A profit growth approach to production while managing unit costs remains a priority as we continue to demonstrate financial strength. Guidance for 2014 was revised upwards to 52,000 ounces last quarter, which we are on track to meet or exceed. Initial guidance for 2015 is 55,000 ounces, with the increase coming primarily from the low-cost Mishi open pit. Current mill capacity supports this increased production rate."

HIGHLIGHTS:

• During the third quarter, the Company generated CAD$3.4 million in free cash flow, or $0.03 per share during the third quarter in 2014. Free cash flow for the first nine months of the year totalled CAD$7.6 million or $0.07 per share.
• Revenue generated for the quarter totalled CAD$22.3 million , cash flow from operations totalled CAD$7.9 million , and net income totalled CAD$2.2 million or $0.02 per share. For the first nine months of the year revenue, cash flow from operations and net income were CAD$61.5 million , CAD$19.7 million , and CAD$9.3 million or $0.09 per share, respectively.
• During the third quarter 12,456 ounces of gold were produced at a recovered grade of 10.1 grams per tonne at Eagle River and 2.4 grams per tonne at Mishi.  Overall, the Eagle River Complex produced 45% more gold in the current quarter over the same period in 2013.  Total year to date production is 39,776 ounces at a recovered grade of 12.0 grams per tonne at the Eagle River mine.  The Company is on track to meet or exceed its upward revised guidance of 52,000 ounces.
• Sales for the quarter were 15,878 ounces at an average price of CAD$1,407 (USD$1,292) .
• Total production cash costs per ounce for the third quarter decreased 19% to average CAD$975 (USD$895) per ounce, compared to CAD$1,208 (USD$1,164) during the same period in 2013. Production cash costs per ounce were slighter higher in the third quarter than the second quarter ( CAD$859 , USD$788 ) due to grade sequencing, and one-time, non-recurring expenditures related to improving mill performance. 
• Total all-in sustaining costs (which includes total cash costs, exploration, development and sustaining capital, project capital, corporate G & A and corporate taxes) on ounces produced were CAD$1,389 per ounce (USD$1,275) , compared to CAD$1,242 per ounce (USD$1,139) in the previous quarter due to lower grades. This is a significant 15% improvement over all-in sustaining cost in the same period last year of CAD$1,631 per ounce (USD$1,576) . All-in sustaining costs for the third quarter on ounces sold were CAD$1,292 per ounce (USD$1,185) .
• Total all-in sustaining costs on a per tonne basis were reduced to CAD$323 (USD$297) per tonne in the third quarter from $CAD486 (USD$446) per tonne in the second quarter due to higher throughput.
• Average daily throughput rates increased 53% in the third quarter to 583 tonnes per day, compared to 382 tonnes per day in the second quarter.  The Company exited the third quarter at a rate of 700 tonnes per day and expects to exit the fourth quarter at a rate of 1,000 tonnes per day.
• The Company was active with its Normal Course Issuer Bid during the third quarter, buying back 203,500 shares at an average price of $0.78 and retiring them.  Current shares outstanding stand at 110,881,591.
• Exploration programs at the Eagle River Complex continued throughout the quarter. The Company is aggressively drilling to delineate and define new parallel zones initially recognized in 2013 at the Eagle River Mine.  This drilling demonstrates the No 7 Zone is opening up at depth (see press release dated September 15, 2014 ). To date, this zone has demonstrated strong continuity, grades and widths over a 200 metre by 100 metre longitudinal area and remains open to the west and at depth.
• The No 7 Zone is located 200 metres north and parallel to the main 8 Zone structure.  Encouraging results also continue from the 300 Zone (located 400 metres north and parallel to the main structure).  Results have prompted a decision to access and develop this zone from a crosscut currently being driven on the 750 metre level. We are currently 170 metres away from the 300 zone.
• Additionally, a crosscut is being driven to the south of the main structure to examine the continuity and grade of the No Name Lake Zone.  The development of these three parallel structures has implications to potentially increase significantly our tonnage per vertical metre, mining flexibility and possibly production rates in the future.

ABOUT WESDOME

Wesdome Gold Mines Ltd. is in its 28^th year of continuous gold mining operations in Canada that employs a profit growth approach to operations.  The Company is currently producing from its Eagle River and Mishi gold mines in Wawa, Ontario , which have earned consistent free cash flow during times of low gold prices. Wesdome's corporate goal is to build a profitable, long-life, sustainable gold mining Company with modest initial capital costs. This strategy has enabled the Company to acquire strategic property and infrastructure assets in two politically stable and historically proven mining camps. Wesdome has significant upside through ownership of its two other properties, the Kiena Mine Complex in Val d'Or , Québec and the Moss Lake gold deposit located 100 kilometres west of Thunder Bay, Ontario .  These assets are being explored and evaluated to be developed in the appropriate gold price environment. The Company has approximately 110.8 million shares issued and outstanding and trades on the Toronto Stock Exchange under the symbol "WDO."

This news release contains "forward-looking information" which may include, but is not limited to, statements with respect to the future financial or operating performance of the Company and its projects. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements contained herein are made as of the date of this press release and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update forward-looking statements if circumstances, management's estimates or opinions should change, except as required by securities legislation. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements. The Company has included in this news release certain non-IFRS performance measures, including, but not limited to, mine operating profit, mining and processing costs and cash costs. Cash costs per ounce reflect actual mine operating costs incurred during the fiscal period divided by the number of ounces produced.  These measures are not defined under IFRS and therefore should not be considered in isolation or as an alternative to or more meaningful than, net income (loss) or cash flow from operating activities as determined in accordance with IFRS as an indicator of our financial performance or liquidity. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company's performance and ability to generate cash flow.

SOURCE Wesdome Gold Mines Ltd.