Mr. John McCluskey reports

ALAMOS GOLD REPORTS THIRD QUARTER 2023 RESULTS

Alamos Gold Inc. has released its financial results for the quarter ended Sept. 30, 2023. All amounts are in U.S. dollars, unless otherwise stated.

"With another strong quarterly performance, we are on pace for a record year both operationally and financially. Production of 135,400 ounces was above our quarterly guidance, putting us on track to set a new record for annual production. Given the strong year-to-date performance, we are raising our full-year production guidance by 5 per cent to a range of 515,000 to 530,000 ounces. With total cash costs and all-in sustaining costs below the midpoint of guidance in the quarter and year to date, we are also on track to achieve full-year cost guidance," said John A. McCluskey, president and chief executive officer.

"This contributed to another solid quarter financially with $37-million of free cash flow, bringing the year-to-date total to $109-million. This represents a substantial increase from 2022 while investing in our high-return growth projects. At Island Gold, the phase-3-plus expansion is progressing well with the headframe up and shaft sinking on schedule to begin later this year. The updated feasibility study on Lynn Lake outlined another long-life, low-cost project in Canada, with excellent exploration upside. The development plan for [Puerto Del Aire] is also advancing as the deposit continues to grow through ongoing exploration success. All three projects are key drivers of our ongoing value creation and strong long-term outlook, supporting growing production, declining costs and increasing profitability," Mr. McCluskey added.

Third quarter 2023:

• Produced 135,400 ounces of gold, exceeding quarterly guidance of 120,000 to 130,000 ounces, reflecting strong performances from the Mulatos district and Island Gold;
• The company is raising its annual production guidance to a range of 515,000 to 530,000 ounces, a 5-per-cent increase from original guidance (based on the midpoint), driven by the strong outperformance from the Mulatos district; with year-to-date production of 399,800 ounces, the company is on pace for record annual production in 2023;
• The Mulatos district produced 53,900 ounces in the third quarter and 164,700 ounces year to date, nearly double the prior-year period, reflecting another solid performance from La Yaqui Grande; the higher-margin ounces from La Yaqui Grande drove mine-site free cash flow of $30.9-million, bringing the year-to-date total to $114.7-million;
• Island Gold produced 36,400 ounces, a 19-per-cent increase compared with the second quarter of 2023, reflecting both higher grades and throughput; the phase-3-plus expansion is progressing well with construction of the headframe largely complete and shaft sinking on track to begin by year-end;
• Sold 132,633 ounces of gold at an average realized price of $1,932 per ounce, for quarterly revenues of $256.2-million; the average realized gold price was $4 per ounce above the London PM fix;
• Total cash costs (1) of $835 per ounce were at the low end of annual guidance, and AISC (all-in sustaining cost) (1) of $1,121 per ounce was below the low end of guidance, driven by La Yaqui Grande and Island Gold and timing of sustaining capital expenditures; the company remains on track to achieve full-year cost guidance with total cash costs and AISC both below the midpoint of guidance year to date;
• Realized adjusted net earnings (1) of $54.5-million, or 14 cents per share; adjusted net earnings include adjustments for net unrealized foreign exchange losses recorded within both deferred taxes and foreign exchange of $11.9-million, and other losses totalling $3.2-million; reported net earnings were $39.4-million, or 10 cents per share;
• Free cash flow (1) of $37.3-million in the third quarter and $109.4-million year to date, a substantial increase from 2022, reflecting the strong operating performance and margin expansion; the company expects to continue generating significant continuing free cash flow over the next several years while financing the phase-3-plus expansion at Island Gold;
• Generated cash flow from operating activities of $112.5-million ($133.2-million, or 34 cents per share, before changes in working capital (1));
• Paid a quarterly dividend of $9.9-million, or 2.5 cents per share (annualized rate of 10 cents per share);
• Cash and cash equivalents increased to $215.9-million, up 14 per cent from the end of the second quarter and 66 per cent from the start of the year, reflecting strong free cash flow generation; the company remains debt-free;
• Completed an updated feasibility study on the Lynn Lake project, outlining a larger, longer-life, low-cost operation with attractive economics and significant exploration upside; Lynn Lake is expected to produce an average of 176,000 ounces of gold per year at mine-site AISC of $699 per ounce over its initial 10 years;
• Provided an exploration update at Mulatos, further expanding high-grade mineralization beyond mineral reserves and resources at PDA and intersecting additional wide intervals of significant gold mineralization at the Capulin regional target; a development plan incorporating the growth in mineral reserves at PDA is expected to be completed toward the end of 2023.

(1) Refer to the non-generally accepted accounting principle measure and additional GAAP measure disclosure in the associated management's discussion and analysis for a description and calculation of these measures.

The company's objective is to operate a sustainable business model that supports growing returns to all stakeholders over the long term, through increasing production, expanding margins and increasing profitability. This includes a balanced approach to capital allocation focused on generating strong continuing free cash flow while reinvesting in high-return internal growth opportunities and supporting higher returns to shareholders.

With another strong quarterly performance, the company continues to execute on this strategy on all fronts. Production of 135,400 ounces exceeded third quarter guidance while costs remained near the low end of annual guidance. This was driven by a solid quarter from Island Gold and another exceptional quarter from La Yaqui Grande.

Given the strong year-to-date performance, full-year production guidance has been increased to a range of 515,000 to 530,000 ounces. This marks a 5-per-cent increase from original 2023 guidance (based on the midpoint) driven by the solid outperformance from the Mulatos district. This also represents a 13-per-cent increase from 2022, with the company on pace to establish a new record for annual production. The company also remains well positioned to achieve full-year cost guidance with total cash costs and AISC both below the midpoint of annual guidance year to date.

Fourth quarter production is expected to be between 115,000 and 130,000 ounces with AISC expected to be slightly above the top end of annual guidance, reflecting higher sustaining capital and lower grades mined at La Yaqui Grande. Full-year costs and capital are expected to be in line with guidance.

Financially, it was another solid quarter with free cash flow of $37.3-million, bringing the year-to-date total to $109.4-million. As part of a balanced approach to growth, the company continues to generate solid free cash flow while advancing its growth initiatives, including the phase-3-plus expansion at Island Gold and the Lynn Lake and PDA projects. These are key elements of the company's strong long-term outlook, which are expected to support growing production, declining costs and further free cash flow growth in the years ahead.

The phase-3-plus expansion at Island Gold is progressing well with construction of the hoist house complete, and the headframe nearing completion, putting the start of shaft sinking on track to begin toward the end of this year. In August, an updated feasibility study was released on the Lynn Lake project, outlining a larger, longer-life, low-cost operation located in Canada, with excellent exploration upside. This followed the receipt of a positive decision statement for the federal environmental impact statement (EIS) earlier this year, a significant permitting milestone for the project.

At PDA, stepout drilling continues to extend high-grade mineralization beyond mineral reserves and resources supporting the expected continuing growth of the deposit. This growth will be incorporated into a development plan, which is expected to be completed toward the end of this year and will outline a significant mine life extension at the Mulatos district.

Young-Davidson continues to be a consistent performer with mining rates in line with target rates and the operation generating $30.9-million of mine-site free cash flow in the quarter and $82.6-million year to date. With higher grades expected in the fourth quarter, the operation is on track to meet full-year production guidance and generate more than $100-million of mine-site free cash flow for the third consecutive year.

Island Gold performed well in the third quarter with higher mining rates and grades driving a 19-per-cent increase in production from the second quarter. With year-to-date production of 99,800 ounces, the operation is well positioned to meet full-year production guidance. As outlined in the phase-3-plus expansion study released in June, 2022, grades mined are expected to increase in 2024, driving production higher. A further increase in grades and an increase in mining rates toward the latter part of 2025 are expected to drive an additional increase in production and a reduction in costs. As demonstrated through the year, Island Gold continues to generate strong cash flow from operations, allowing the operation to finance the majority of capital spending on the phase-3-plus expansion.

Combined gold production from the Mulatos district totalled 53,900 ounces in the quarter, reflecting another strong performance from La Yaqui Grande. Year to date, the combined operation produced 164,700 ounces, nearly double the prior-year period and putting it on pace to exceed full-year guidance. Reflecting the strong operational performance, Mulatos generated $30.9-million of mine-site free cash flow in the quarter, bringing the year-to-date total to $114.7-million. As previously guided, production is expected to decrease into the fourth quarter, reflecting the end of mining within the main Mulatos pit in July, as well as the return to guided grades at La Yaqui Grande.

Capital spending, including capitalized exploration, totalled $75.2-million in the third quarter and $239.2-million year to date. Capital spending is expected to increase in the fourth quarter, reflecting the continued ramp-up in spending on phase-3-plus expansion and higher sustaining capital. Full-year capital spending is expected to be consistent with guidance of $317-million to $357-million.

The global exploration budget for 2023 is consistent with spending in 2022. The Mulatos district accounts for the largest portion of the budget at $25-million, up from an initial budget of $17-million, reflecting continuing exploration success. This is followed by a $14-million budget at Island Gold, $8-million at Young-Davidson and $5-million at Lynn Lake. The exploration focus in 2023 continues to follow up on a successful year in 2022, with mineral reserves increasing for the fourth consecutive year to 10.7 million ounces of gold.

The company's liquidity position continues to strengthen with cash and cash equivalents increasing to $215.9-million at the end of the third quarter, up from $129.8-million at the start of the year, while remaining debt free. Additionally, the company has a $500-million undrawn credit facility, providing total liquidity of $715.9-million. As part of a balanced approach to growth and capital allocation, the current focus of growth capital is the phase-3-plus expansion at Island Gold. With no significant capital expected to be spent on developing Lynn Lake until the phase-3-plus expansion is well advanced, the company remains well positioned to finance this growth internally while generating strong free cash flow over the next several years. The company expects a further increase in free cash flow in 2026 with the completion of the phase-3-plus expansion.

Associated documents

This press release should be read in conjunction with the company's interim consolidated financial statements for the three-month period ended Sept. 30, 2023, and associated management's discussion and analysis, which are available from the company's website in the investors section under reports and financials and on SEDAR+ and EDGAR.

Reminder of third quarter 2023 results conference call

The company's senior management will host a conference call on Thursday, Oct. 26, 2023, at 10 a.m. ET, to discuss the results. Participants may join the conference call by webcast or through the following dial-in numbers.

Toronto and international:  416-340-2217

Toll-free (Canada and the United States):  800-898-3989

Participant passcode:  3694467 followed by the number sign

Webcast:  at the Alamos website

A playback will be available until Nov. 26, 2023, by dialling 905-694-9451 or 800-408-3053 within Canada and the United States. The passcode is 3494502 followed by the number sign. The webcast will be archived at the Alamos website.

Qualified person

Chris Bostwick, FAusIMM, Alamos's senior vice-president, technical services, who is a qualified person within the meaning of National Instrument 43-101, has reviewed and approved the scientific and technical information contained in this press release.

About Alamos Gold Inc.

Alamos is a Canadian-based intermediate gold producer with diversified production from three operating mines in North America. This includes the Young-Davidson and Island Gold mines in Northern Ontario, Canada, and the Mulatos mine in Sonora state, Mexico. Additionally, the company has a strong portfolio of growth projects, including the phase-3-plus expansion at Island Gold and the Lynn Lake project in Manitoba, Canada. Alamos employs more than 1,900 people and is committed to the highest standards of sustainable development. The company's shares are traded on the Toronto Stock Exchange and the New York Stock Exchange under the symbol AGI.

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