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Orla Mining Posts Mixed Q2 Results, Reiterates Guidance for 2022

Story Highlights

Orla Mining has posted mixed Q2 results amid its efforts to enhance production and stimulate organic and inorganic growth.

Orla Mining Ltd. (TSE: OLA) (NYSE: ORLA) has reported mixed results for the second quarter of 2022 and reiterate its guidance for the year. Shares of the company were up 6% on Monday.

What Does Orla Mining Do?

With a market cap of C$828.83 million, Orla Mining is a mineral exploration company that is engaged in the acquisition and exploration of mineral properties. The company conducts business operations in the regions of Mexico, Panama, the United States, and Canada.

Orla Mining’s Q2 Results in Detail

The mining company’s adjusted net income came in at 4 cents per share against the loss of 3 cents per share a year ago. However, analysts had expected the company to post a net income of 7 cents per share in the quarter. Revenues came in at $47.8 million in the reported quarter.

The company extracted 25,672 ounces of gold during the reported quarter. Orla Mining witnessed sales of 25,431 ounces of gold at an average realized gold price of $1,872 per ounce in the reported quarter.

In the first half of 2022, the company extracted 48,704 ounces of gold. The company sold 46,315 ounces of gold at an average realized gold price of $1,879 per ounce in the first six months of the year.

Total cash costs of $439 per ounce were incurred in the quarter. Also, All-In Sustaining Cost (AISC) came in at $601 per ounce.

During the quarter, Camino Rojo Oxide Mine began commercial production and produced 25,672 ounces of gold. The average daily stacking throughput for the reported quarter exceeded the design capacity at 18,245 tonnes per day.

The company recorded $20.7 million in cash flow from operating activities before alterations in non-cash working capital. The free cash flow came in at $28.7 million. The mining company exited the second quarter of 2022 with a cash balance of $66.7 million.

Orla Mining Reiterates 2022 Outlook

The mining company continues to project gold production in the 90,000 to 100,000-ounce range. It also expects total capital expenditures of $25 million and AISC of $600-$700 per ounce sold (from Q2 to Q4 2022). The expenses on exploration are projected to come in at $15 million, including $10 million for activities in Mexico and $5 million for Panama.

Will Orla Mining Go Up?

Orla Mining stock has upside potential of 64.4% from current levels. OLA’s average price forecast stands at C$7.25. On TipRanks, analysts are optimistic about the stock that commands a Strong Buy consensus rating, which is based on five Buys.

Contrary to the analysts, financial bloggers on TipRanks are 50% Neutral on OLA, compared to the sector average of 73%. News sentiment is also Neutral for the stock.

Orla Mining Faces Headwinds, but Its Prospects Remain Bright

The mining company is exposed to headwinds of rising costs amid high inflation levels and operational challenges. However, the company’s prospects look good, as it is taking initiatives to expand production. Camino Rojo Oxide Mine beginning commercial production is a positive for the stock. Also, the company’s efforts to grow inorganically by acquiring Gold Standard Ventures Corp. buoys optimism.

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