AuRico Gold Inc. (AUQ) Q3 2012 Earnings Call November 13, 2012 10:00 AM ET

Operator

Good morning. My name is Matthew and I will be your conference operator today. At this time, I would like to welcome everyone to the AuRico Gold Third Quarter Results Conference Call. All lines have been placed on-mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. (Operator Instructions) Thank you.

Anne Day, you may begin your conference.

Anne Day – VP, Investor Relations

Thank you, operator and good morning everyone. Thanks for joining us today for the AuRico Gold third quarter earnings results conference call and webcast. On the line today, we have Scott Perry, our President and CEO; Charlene Milner, VP Finance and Interim CFO; Russell Tremayne, Chief Financial Officer, Mexico and Peter MacPhail, Chief Operating Officer, Canada. They will also be available during the Q&A period at the end of the call. At the end of the presentation, the operator will provide instructions again for those who wish to ask questions. Should you wish to follow along via our webcast it is available on our home page at auricogold.com.

Before we begin, I will go through the abbreviated version of our forward-looking statements which are also provided in the press release and today’s presentation. Some of today’s commentary may certain forward-looking information for AuRico. In this respect, we refer you to our detailed cautionary note regarding forward-looking statements in our press release and presentation. You are cautioned that actual results and future events could differ materially from the respective conclusions, forecasts or projections. We refer you to the section entitled the risk factors and our latest MD&A and other filings available on SEDAR which set out the material factors that would cause results to differ.

I will now turn the call over to Scott Perry.

Scott Perry – President & CEO

Okay, thank you Anne and welcome ladies and gentlemen and thank you for attending our call. I am going to start off from slide number four. I am just looking to recap some of AuRico’s recent highlights. From an operations perspective, the key quarterly highlights on September 3rd our Young-Davidson mine declared commercial production. In Young-Davidson’s third month of commercial operations being the month of September, the mine produced in excess of 9,000 ounces at cash cost of $639 per ounce. On the back of this positive transition and commercial production this favorable monthly performance continued in October where again the mine produced in excess of 9,000 ounces at similar operating cost levels.

Mill feed grades are continuing to increase through a combination of higher grade open pit ore and the initial production contributions from the underground. Young-Davidson is transitioning smoothly from commissioning underground operations and during the fourth quarter, the company has targeted mining 90,000 tons of underground production at grade in excess of 3 grams per ton. This included the 12,000 tons mined in the month of October, at grade averaging 4 grams per ton.

We are looking forward to reporting production for November and December, where production levels should be favorably underpinned by the increased presence of higher grade tonnage being mined from the underground operations.

The key corporate development highlights during the quarter was that on October 9th, the company entered into a definitive agreement with Minera Frisco, pursuant to which, Minera Frisco will acquire the Ocampo mine as well as a 50% interest in the Orion development project for the total consideration of $750 million in cash.