* Sees Q4 output rise on more capacity at recovery plant
* Q3 adj EPS in line with estimates at $0.10
* Revenue down 17 pct at $34.3 mln vs est $39.3 mln
* Back FY production
* Shares rise as much as 8 percent (Rewrites; adds analyst comments, updates share movement)
By Gowri Jayakumar
BANGALORE, Nov 4 (Reuters) - Canada’s Alamos Gold Inc AGI.TO forecast a rise in production in the fourth quarter, after three straight quarters of declines, due to additional capacity at its gold recovery plant, sending its shares up 8 percent.
The Mexico-focused miner’s production had fallen due to bad weather and delays in installing a screening plant at its flagship Mulatos mine.
The screening plant began operating in October and the additional capacity boosted average daily throughput by about 28 percent, the gold miner said in a statement.
“They’ve introduced a new screening plant, which means their crushing rate can increase by 13-20 percent, and their stacking rates are already well up... all of these are positive even more so into the next year,” said David Haughton, an analyst with BMO Capital Markets-Canada.
Third-quarter revenue fell 17 percent to $34.3 million, due to lower production. The gold miner had reported a 32 percent drop in production late last month. [ID:nSGE69L0HQ]
For July-September, Alamos’ profit rose 38 percent to $19.5 million, or 17 cents a share, including a $12.5 million gain related to a settlement agreement with Primero Mining P.TO over the ownership of the San Dimas mines in Mexico.
Alamos earned $14.1 million, or 13 cents a share, a year ago.
On an adjusted basis, Alamos earned 10 cents a share, in line with analysts’ estimates, according to Thomson Reuters I/B/E/S.
Alamos also backed its full-year production outlook of 160,000-175,000 ounces, but raised its cash operating cost outlook by 4 percent to $300 per ounce due to higher input costs and a stronger Mexican peso.
The gold explorer, which is currently developing two projects in Turkey besides expanding in Mexico, had capital expenses totaling $15.8 million in the third quarter.
Haughton sees Alamos spending about $80-$120 million in 2011 on exploration in Mexico and elsewhere.
Last month, Alamos’ peer Aurizon Mines ARZ.TO, which operates in Quebec, cut its full-year production target due to poor ground conditions at the mine and scarcity of underground mining equipment. [ID:nSGE69L0HQ]
Alamos shares, which have shed about 4 percent of their value since reporting lower production, touched a high of C$17.36. They later pared some gains and were trading up 7 percent at C$17.23 Thursday afternoon on the Toronto Stock Exchange. (Reporting by Gowri Jayakumar in Bangalore; Editing by Anne Pallivathuckal)