Despite strong gold prices, TMAC Resources showed a loss of $18 million in releasing its first quarter financial results on Thursday.

The company, which operates the Doris North gold mine on the Hope Bay property in the Kitikmeot region, sold 27,710 ounces of gold for gross revenues of $59.4 million but it wasn't enough to cover costs. TMAC reported a loss of 16 cents per share, although the bulk of that was blamed on re-evaluation of U.S. dollar debt.

TMAC closed the quarter with $120.6 million (U.S.) in debt on its books.

In the previous quarter, the junior miner reported a net loss of $5.46 per share due to an impairment adjustment of $620.6 million, which is a depreciation in market value. The loss per share would have been seven cents had it not been for the impairment.

Due to scaled back operations because of the Covid-19 pandemic, the company has spent the past few months primarily processing gold from stockpiles that were previously mined.

"We expect to continue operating at a reduced level for the foreseeable future," stated Jason Neal, TMAC's president and CEO.

A special meeting of shareholders is scheduled for June 26 to vote on being acquired by Shandong Gold Mining, a Chinese state-owned company. Shandong is offering $1.75 per share. TMAC Resources has been trading between $1.46 and $1.71 per share over the past month. The company's leadership and largest shareholding institutions have already expressed their support for the buyout.

However, a Yellowknife MLA has urged rejection of the Chinese company's bid. The transaction would be subject to approval from the Government of Canada, and the Kitikmeot Inuit Association (KIA) also has a say. Shandong Gold Mining has stated that it plans to honour the existing Inuit Impact Benefit Agreements that the KIA has signed with TMAC Resources.