Mr. Renaud Adams reports

IAMGOLD REPORTS THIRD QUARTER 2023 RESULTS

Iamgold Corp. today released its financial and operating results for the third quarter ended Sept. 30, 2023. All monetary amounts are expressed in U.S. dollars, unless otherwise indicated.

Highlights:

Operations

• Attributable gold production from continuing operations was 109,000 ounces. Attributable gold production guidance for 2023 is unchanged and is expected to be in the range of 410,000 to 470,000 ounces.
• Revenues from continuing operations were $224.5-million from sales of 116,000 ounces (106,000 ounces on an attributable basis) at an average realized gold price1 of $1,937 per ounce.
• Cost of sales per ounce sold from continuing operations was $1,436, cash cost per ounce sold from continuing operations was $1,400 and all-in sustaining cost (AISC) per ounce sold from continuing operations was $1,975.
• The company now expects cash costs to be between $1,250 and $1,325 per ounce sold and AISC to be between $1,750 and $1,825 per ounce sold for the year, an increase from prior guidance due to the impact of the security situation in Burkina Faso on the supply chain combined with continued elevated costs from the recent inflationary cycle in the industry.
• In health and safety, for the nine months ended Sept. 30, 2023, the company reported a DARTFR (days away, restricted, transferred duty frequency rate) of 0.36 and a TRIFR (total recordable injuries frequency rate) of 0.66, both with a decreasing trend since the last quarter.

Financial

• Net earnings (loss) attributable to equity holders of $(800,000) or (zero cents) per share and adjusted net loss attributable to equity holders of $(4.0)-million or (one cent) per share.
• Net cash from operating activities was $37.5-million. Net cash from operating activities, before movements in non-cash working capital and non-current ore stockpiles was $29.3-million.
• Earnings before interest, income taxes, depreciation and amortization (EBITDA) from continuing operations was $61.8-million and adjusted EBITDA was $57.8-million.
• The company has available liquidity of $1,001.8-million comprising cash and cash equivalents of $548.9-million and the available balance of the secured revolving credit facility of $452.9-million as at Sept. 30, 2023.

Cote gold

• As of Sept. 30, 2023, the Cote gold project was estimated to be 90.6-per-cent complete, with construction progress approximately 92-per-cent complete.
• On a 100-per-cent basis at the UJV level, the Cote gold project incurred project expenditures of $317.3-million ($222.0-million at 70 per cent) in the third quarter 2023.
• Since commencement of construction, $2.54-billion ($1.78-billion at 70 per cent) of the planned $2,965-million ($2.08-billion at 70 per cent) of project expenditures has been incurred. The total expected project expenditures are expected to be in line with the planned $2,965-million (plus or minus 1.5 per cent) and the estimated remaining cost to complete the Cote gold project on a 100-per-cent basis is $425-million ($298-million at 70 per cent) on an incurred basis assuming a U.S. dollar/Canadian dollar rate of 1.35 during the remainder of construction. A portion of the expenditures is expected to be incurred in 2024 during commissioning and ramp-up.
• Iamgold is expected to finance $325-million during the remainder of construction based on its 60.3-per-cent ownership in the Cote gold unincorporated joint venture.

Corporate

• On April 25, 2023, the company completed the sale of its 90-per-cent interest in the Boto gold project in Senegal and its 100-per-cent interest in the early stage exploration properties of Boto West, Senala West, Daorala and the vested interest in the Senala option earn-in joint venture, also in Senegal (Senegal assets) for aggregate gross cash proceeds of $197.6-million. On Oct. 26, 2023, the company received $32.0-million in deferred consideration from the closing of the sale of Senegal assets.
• On Aug. 1, 2023, the company entered into an agreement to sell its 100-per-cent interest in the Pitangui project, a greenfield exploration property located in Brazil, as well as its interest in the Acurui project, to Jaguar Mining Inc. via a share purchase agreement. The company received 6.3 million common shares from Jaguar for an aggregate value of $9.0-million. The company will also retain a net smelter royalty on both projects.
• On Sept. 21, 2023, the company announced the retirement of Maryse Belanger from the board of directors for personal reasons and other commitments. Immediately following Ms. Belanger's retirement, the board appointed David Smith as chair of the board.
• On Sept. 27, 2023, Bruno Lemelin was appointed to the role of chief operating officer, having served as senior vice-president, operations and projects, since March, 2020.
• On Nov. 9, 2023, the company entered into a one-year extension of its credit facility extending its maturity to Jan. 31, 2026. As part of the extension, the credit facility was reduced to $425-million based on the company's requirements for a senior revolving facility for its overall business.
• On Nov. 9, 2023, the company announced the retirement of Ian Ashby from the board, and the appointment of Anne Marie Toutant as an independent director.

"Iamgold finished the quarter with year-to-date production from continuing operations of 329,000 ounces, putting the company well on track to meet its annual production guidance of 410,000 to 470,000 ounces," said Renaud Adams, president and chief executive officer of Iamgold. "This performance has been driven by the continued resiliency of our Essakane operating teams as they manage the operation within a geopolitically challenging environment, as well as the continued dedication of the Westwood team as they rebuild and reopen mining areas underground. Despite these achievements, operating costs, particularly in Burkina Faso, remain high as price increases from the prior inflationary period are slow to decline and the higher cost of operating and moving goods within the country remain. At Iamgold, we always place the health and safety of our employees first, and we work continuously with a focus on our goal of Zero Harm -- for the people and the places in which we operate.

"At Cote gold we are nearing the finish line of construction. Precommissioning teams are starting to receive hand-off of project elements from construction teams, as activities at site start the shift from major construction to finalization and commissioning. Construction at the end of September was 92-per-cent complete, putting the project on track for gold production in the first quarter of next year. It is an exciting time for Iamgold as this is a project that is critical for the repositioning of this company, as once on line, Iamgold will have a significantly higher production base and lower cost profile, providing a strong foundation of cash flow and growth opportunities in Canada."

Quarterly summary

The attached table summarizes certain operating and financial results for the three months ended Sept. 30, 2023 (Q3 2023), Sept. 30, 2022 (Q3 2022), and the nine months ended Sept. 30 (or YTD), 2023, and 2022 and certain measures of the company's financial position as at Sept. 30, 2023, and Dec. 31, 2022. Financial results of Rosebel include the one-month period ended Jan. 31, 2023, prior to the closing of the sale to Zijin Mining Group Co. Ltd. that was announced on Oct. 18, 2022.

Outlook

Production outlook

Attributable gold production guidance for 2023 is unchanged and is expected to be in the range of 410,000 to 470,000 ounces. Westwood production is expected to be at the top end of the guidance range and Essakane production is expected to be within the guidance range.

Costs outlook

Cash costs guidance for 2023 has been revised to $1,250 and $1,325 per ounce sold and AISC guidance is revised with costs expected to be between $1,750 and $1,825 per ounce sold, mainly due to cost pressures at Essakane resulting from the security situation, combined with continued elevated prices from recent inflation and increased underground rehabilitation performed at Westwood. At Essakane, the landed cost of fuel and other consumables has increased due to the measures taken to reduce the impact of the security situation on the supply chain as well as the increased cost of producing energy used in the mill arising from the periodic substitution of more expensive light fuel in periods when heavy fuel used for power generation is unavailable. At Westwood, the level of ground support required for the development and rehabilitation work increased relative to the annual plan combined with the advancing of a portion of the 2024 scope of work into the current year to derisk future years.

Capital expenditures

Sustaining capital expenditures for 2023 have been revised downwards to approximately $190-million (plus or minus 5 per cent). The reduction primarily relates to lower volumes of capitalized stripping year to date at Essakane due to periodic interruptions to mining activity due to supply shortages of light fuel. At Westwood, sustaining capital expenditure guidance has been refined following an increase in guidance last quarter as a result of increased visibility into end of year underground development and rehabilitation rates.

Expansion capital for 2023, excluding Cote gold, is expected to be approximately $5-million, on an incurred basis. project expenditures to complete the Cote gold project, from Jan. 1, 2023, onward, are expected to be $875-million (plus or minus 5 per cent), on a 70-per-cent basis. Project expenditures at Cote gold consist of capital expenditures, right-of-use assets purchased through leasing, supplies inventory and the cost to build the ore stockpile. Some of the Cote gold project expenditures will be incurred in early 2024 during commissioning and ramp-up.

Exploration outlook

Exploration expenditures for 2023 are expected to be approximately $18.0-million, including $3.0-million on the Gosselin resource delineation drilling program, as well as other near-mine and greenfield programs.

Outlook

Westwood gold production is expected to be at the top end of the range of 70,000 to 90,000 ounces in 2023. Production levels and unit costs are expected to continue to improve into the fourth quarter of the year, benefiting from the continued advancement of underground development providing access to more and higher-grade stope sequences. Mill feed will continue to be supplemented from available satellite surface deposits, including increased proportions of comparatively higher-grade ore feed from the satellite Fayolle property.

Capital expenditures are expected to be approximately $65-million of sustaining capital in support of underground development and rehabilitation work, the renewal of the mobile fleet and fixed equipment, repairs to the Westwood mill, and other capital projects.

The company plans to file an updated National Instrument 43-101 technical report detailing the results of certain mine optimization efforts and strategic assessments of the Westwood complex during 2024 as the underground mine plan continues to be optimized based on recent performance.

Projects

Cote gold project: Ontario, Canada

As of Sept. 30, 2023, overall, the project was estimated to be 90.6-per-cent complete, with construction progress approximately 92-per-cent complete. Cote gold is expected to commence production in the first quarter of 2024.

Project expenditures

Since commencement of construction, $2.54-billion ($1.78-billion at 70 per cent) of the planned $2,965-million ($2.08-billion at 70 per cent) of project expenditures has been incurred. The original budget assumed a U.S. dollar/Canadian dollar exchange rate of 1.25.

On a 100-per-cent basis at the UJV level, the Cote gold project incurred project expenditures of $317.3-million ($222.0-million at 70 per cent) in the third quarter 2023 at an average U.S. dollar/Canadian dollar exchange rate of 1.33 and $831.3-million ($581.8-million at 70 per cent) in the nine months ended Sept. 30, 2023, at an average U.S. dollar/Canadian dollar exchange rate of 1.34. Incurred project expenditures include the cost of supplies inventory and the build of the initial ore stockpile.

The total project expenditures are expected to be in line with the planned $2,965-million (plus or minus 1.5 per cent) and the estimated cost to complete the Cote gold project on a 100-per-cent basis is $425-million ($298-million at 70 per cent) on an incurred basis assuming a U.S. dollar/Canadian dollar rate of 1.35 during the remainder of construction. A portion of the project expenditures is expected to be incurred in 2024 during commissioning and ramp-up.

The company financed approximately $149.6-million to the UJV during the quarter and SMM financed $98.5-million, including an additional $24.1-million that was financed due to its increased ownership.

Based on the company's 60.3-per-cent ownership in the UJV, Iamgold's remaining funding requirement, after the JV funding and amending agreement with SMM -- and incorporating project expenditures, changes in working capital and leases -- is expected to be $325-million and SMM will finance an incremental amount of approximately $41.0-million due to its increased ownership.

Funding transaction with Sumitomo

On Dec. 19, 2022, the company announced it had entered into the JV funding and amending agreement with SMM. As outlined in the JV funding and amending agreement, as of May 1, 2023, SMM has contributed $250.0-million of the company's funding obligations to the Cote gold project and as a result, the company transferred 9.7 per cent of its interest in the Cote gold project to SMM (the transferred interests).

For accounting purposes, the JV funding and amending agreement does not meet the requirements under IFRS (international financial reporting standards) to recognize the dilution of the company's interest in the Cote UJV as a sale -- and so the company will continue to account for 70 per cent of the assets and liabilities of the joint venture. The company has recognized a financial liability equal to the current repurchase price and option fee.

The company has a right to repurchase the transferred interests on seven dates between Nov. 30, 2023, and Nov. 30, 2026, to return to its full 70-per-cent interest in the Cote gold project. The company may exercise its repurchase option through the payment of the aggregate amounts contributed by SMM on behalf of the company, totalling $250.0-million, plus the incremental contributions made and less incremental gold production received by SMM due to its increased ownership, up to achieving commercial production. SMM contributed an incremental $49.2-million during the nine months ended Sept. 30, 2023, based on its 9.7-per-cent increase in ownership. SMM will retain the net proceeds or payments due from its increased ownership from the achievement of commercial production up to the repurchase of the transferred interests.

Up to the earlier of the company exercising the repurchase option and Nov. 30, 2026, the company will pay a repurchase option fee to SMM equal to the three-month SOFR (secured overnight financing rate) plus 4 per cent on the amounts advanced by SMM, during construction and up to achieving commercial production, less the value of the incremental gold production up to achieving commercial production. The repurchase option fee accrued during 2023 will be payable upon the earlier of the company's exercise of the repurchase option or Nov. 30, 2026. The repurchase option fee will be payable in cash quarterly from Jan. 1, 2024. The JV funding and amending agreement also includes changes to the operator's fee, the governance structure, including increasing the approval threshold of the oversight committee for annual budgets and unbudgeted expenditures above specified amounts. Iamgold's rights on the oversight committee are maintained and Iamgold remains as the operator.

Financial review

Liquidity and capital resources

As at Sept. 30, 2023, the company had $548.9-million in cash and cash equivalents at its continuing operations and net debt of $478.1-million. Approximately $452.9-million was available under the company's credit facility resulting in liquidity at Sept. 30, 2023, of approximately $1,001.8-million.

Within cash and cash equivalents, $76.8-million was held by Cote gold and $54.6-million was held by Essakane. The Cote gold UJV requires its joint venture partners to finance, in advance, two months of future expenditures and cash calls are made at the beginning of each month, resulting in the month-end cash balance approximating the following month's expenditure. The company uses dividends and intercompany loans to repatriate funds from its operations and the timing of dividends may impact the timing and amount of required financing at the corporate level, including the company's drawdowns under the credit facility. Excess cash at Essakane is mainly repatriated through dividend payments, of which the company will receive its 90-per-cent share, net of dividend taxes. Essakane declared a dividend during the second quarter 2023 of $120.0-million, which was received by Iamgold in the third quarter, net of minority interest and withholding taxes. SMM financed the company's portion of the Cote UJV funding in the first quarter 2023 and partially during the second quarter 2023 as part of the funding arrangement announced on Dec. 19, 2022. During the remainder of construction, the company will finance its portion of the Cote UJV funding of $325-million from available cash balances.

Restricted cash in support of environmental closure costs obligations related to Essakane, Doyon division and Cote gold project totalled $57.6-million.

Income statement

Revenues -- Revenues from continuing operations were $224.5-million in the third quarter 2023 from sales of 116,000 ounces (106,000 ounces on an attributable basis) at an average realized gold price of $1,937 per ounce, lower by $30.0-million or 12 per cent than the prior-year period, due to lower sales, partially offset by a higher realized gold price.

Cost of sales -- Cost of sales excluding depreciation was $166.0-million in the third quarter 2023, higher by $5.9-million or 4 per cent than the prior-year period. The increased costs are due to increased mining activity at Westwood and the impacts of the security situation in Burkina Faso resulting in higher landed fuel prices, transportation and camp costs, as well as higher labour costs due to appreciation in the local currency. In addition to the fuel pricing pressures, power generation costs increased as heavy fuel used normally was periodically substituted with more expensive light fuel to maintain operations when supply was limited.

Depreciation expense -- Depreciation expense was $53.9-million in the third quarter 2023, lower by $17.7-million or 25 per cent than the prior-year period primarily due to lower production volumes at Essakane.

Exploration expense -- Exploration expense was $6.2-million in the third quarter 2023, higher by $800,000 or 15 per cent than the prior-year period due to higher planned spend.

General and administrative expense -- General and administrative expense was $12.4-million in the third quarter 2023, higher by $1.5-million or 14 per cent than the prior-year period, primarily due to higher share-based payments of $1.0-million, consulting costs of $300,000 and director fees and expenses of $200,000.

Income tax expense -- Income tax expense was $4.1-million in the third quarter 2023, lower by $16.8-million or 80 per cent than the prior-year period. It comprises a current income tax expense of $5.7-million offset by a deferred income tax recovery of $1.6-million, lower than the prior-year period for current tax expense by $8.9-million or 61 per cent and lower for deferred tax recovery by $7.9-million or 125 per cent, respectively. The current income tax expense was lower primarily due to lower income in Essakane.

Operating activities

Net cash flow from operating activities from continuing operations was $37.5-million for the third quarter 2023 and decreased by $57.0-million from the same prior-year period, primarily due to: lower cash earnings of $12.9-million on lower sales volume partially offset by higher realized gold prices, an increase in income tax paid of $10.3-million, and net proceeds from the 2022 prepay arrangements of $59.0-million included in the third quarter 2022. These were offset by: a decrease in trade and other receivables of $16.1-million, and higher settlement of derivatives of $9.1-million.

Investing activities

Net cash used in investing activities from continuing operations for the third quarter 2023 was $236.8-million, an increase of $39.1-million compared with the third quarter 2022, primarily due to an increase in capital expenditures for property, plant and equipment of $30.2-million mainly related to the Cote gold construction, and an increase in borrowing costs paid of $11.5-million.

Financing activities

Net cash from financing activities from continuing operations for the third quarter 2023 was $5.0-million. Compared with the third quarter 2022, net cash from financing activities for continuing operations decreased by $216.7-million, primarily due to a draw of $230.0-million credit facility in the third quarter 2022, offset by the proceeds received through the SMM funding arrangement of $24.1-million during the third quarter 2023.

Conference call

A conference call will be held on Friday, Nov. 10, 2023, at 8:30 a.m. Eastern Time for a discussion with senior management regarding Iamgold's third quarter 2023 operating performance and financial results.

Listeners may access the conference call via webcast from the events section of the company's website. Or upon registering on-line, you will receive a calendar booking by e-mail with dial-in details and unique PIN. This process will bypass the operator and avoid the queue.

Toll-free (North America):  1-800-319-4610

International:  1-604-638-5340

Webcast:  Iamgold website

An on-line archive of the webcast will be available by accessing the company's website. A telephone replay will be available for one month following the call by dialling toll-free 1-800-319-6413 within North America or 1-604-638-9010 from international locations and entering the pass code: 0518.

For more information, refer to the management discussion and analysis (MD&A) and unaudited consolidated interim financial statements as at and for the nine months ended Sept. 30, 2023, available on the company's website and on SEDAR+.

About Iamgold Corp.

Iamgold is an intermediate gold producer and developer based in Canada with operating mines in North America and West Africa. The company is building the large-scale, long-life Cote gold project in Canada in partnership with Sumitomo Metal Mining Co. Ltd., which is expected to commence production in early 2024. In addition, the company has an established portfolio of early-stage and advanced exploration projects within high potential mining districts in the Americas. Iamgold employs approximately 3,300 people and is committed to maintaining its culture of accountable mining through high standards of environmental, social and governance (ESG) practices, including its commitment to zero harm in every aspect of its business.

Qualified person and technical information

The technical and scientific information relating to exploration activities disclosed in this document was prepared under the supervision of and verified and reviewed by Craig MacDougall, PGeo, executive vice-president, growth, Iamgold. Mr. MacDougall is a qualified person as defined in National Instrument 43-101.

We seek Safe Harbor.