VANCOUVER, July 30, 2015 /CNW/ - Nevsun Resources Ltd.
(TSX:NSU)(NYSE MKT:NSU) (Nevsun or the Company) is pleased to
report its financial and operating results for the three and six
months ended June 30, 2015.
Unless otherwise noted, with the exception of earnings per
share and realized price and cost per pound figures, all financial
results are in millions of US dollars.
Second quarter 2015 highlights
- Earned $0.05 per share
- Generated $58 million cash from
operating activities
- Working capital of $499 million,
including $452 million of cash
- Produced 32.4 million pounds of copper
- Continued lowest-quartile C1 cash costs([1]) of
$0.97 per payable pound sold
- Paid quarterly dividend of $0.04
per share
- Continued zinc expansion project – on-time and on-budget
- Discovered a new VMS mineral deposit in the Bisha District
- Monetized stockpiled precious metals concentrate
Financial Review
|
Three months ended
June 30,
|
Six months ended June
30,
|
|
2015
|
2014
|
2015
|
2014
|
Revenue
|
$
|
104.2
|
$
|
169.2
|
$
|
221.4
|
$
|
268.4
|
Operating
income
|
|
38.6
|
|
94.9
|
|
81.2
|
|
146.9
|
Net income
|
|
19.2
|
|
53.7
|
|
42.2
|
|
81.9
|
Net income
attributable to Nevsun shareholders
|
|
9.4
|
|
30.5
|
|
22.0
|
|
45.9
|
Basic earnings per
share attributable to Nevsun shareholders
|
|
0.05
|
|
0.15
|
|
0.11
|
|
0.23
|
Working
capital
|
|
498.6
|
|
497.8
|
|
498.6
|
|
497.8
|
|
|
|
|
|
|
|
|
|
Copper price
realized, per payable pound sold
|
|
2.59
|
|
3.21
|
|
2.53
|
|
3.14
|
C1 cash cost per
payable pound sold(1)
|
$
|
0.97
|
$
|
1.05
|
$
|
1.12
|
$
|
1.01
|
|
|
|
|
|
Cliff Davis, CEO of Nevsun,
commented, "Despite copper price declines and some planned and
unplanned plant stoppages in Q2, we had another quarter of strong
earnings and free cash flow generation. The sale of the
precious metals concentrate and a focus on cost control made a
significant contribution to our bottom line. We are pleased to
report our overall cash balance increased during the quarter even
with a weaker quarter of copper production and significant capital
spending on the zinc expansion, which remains on-time and
on-budget."
__________________________
([1])C1 cash cost per payable pound sold is a non-GAAP
measure – see page 12 of the Q2 2015 MD&A for a discussion of
non-GAAP measure.
Operations Review
|
Three months ended
June 30,
|
Six months ended June
30,
|
|
2015
|
2014
|
2015
|
2014
|
Ore mined,
tonnes(1)
|
771,000
|
697,000
|
1,428,000
|
1,184,000
|
Waste mined,
tonnes
|
2,605,000
|
2,719,000
|
6,122,000
|
6,190,000
|
Strip ratio, (using
tonnes)
|
3.4
|
3.9
|
4.3
|
5.2
|
Ore milled
tonnes
|
429,000
|
386,000
|
870,000
|
739,000
|
Copper feed grade,
%
|
4.2
|
6.6
|
4.4
|
6.4
|
Recovery, % of
copper
|
82.5
|
84.6
|
83.2
|
84.1
|
Copper concentrate
grade, %
|
24.9
|
27.1
|
24.9
|
27.9
|
Copper in concentrate
produced, millions of pounds
|
32.4
|
47.4
|
70.4
|
87.1
|
Copper in concentrate
produced, tonnes
|
14,700
|
21,500
|
31,900
|
39,500
|
Payable copper in
concentrate sold, millions of pounds(2)
|
33.6
|
51.5
|
81.0
|
85.5
|
Payable copper in
concentrate sold, tonnes(2)
|
15,200
|
23,400
|
36,700
|
38,800
|
(1)
During the three and six months ended June 30, 2015, 267,000 and
394,000 tonnes of primary ore were mined and stockpiled for future
production.
|
(2) Q1
2014 included 4.5 million pounds or 2,000 tonnes of pre-commercial
production. Receipts from pre-commercial production sales
were credited against mineral property, plant and equipment, net of
cost of sales.
|
Cliff Davis went on to say, "Due
to the unplanned plant stoppages in 2015 we are revising our 2015
guidance to 140 to 150 million pounds for 2015. However, our
cost outlook has significantly improved and we are pleased to
report that we are maintaining our C1 cash costs per payable pound
of copper guidance of $1.20 to $1.40
despite the lower production, ensuring another profitable year for
our shareholders. For the longer term outlook, I am really
pleased with the continued exploration success and that the zinc
expansion remains firmly on track and on budget. We are
maintaining maximum optionality for zinc offtake which remains 100%
uncommitted. We expect further exploration results from Bisha
regional drilling throughout 2015 and are increasingly optimistic
the current commodity price environment will generate M&A
opportunities."
Conference call details
The Company will hold a conference call on Friday, July 31, 2015, at 8AM Vancouver /
11AM Toronto, New
York / 4PM London, to discuss the Q2 2015 results. Please
call in at least five minutes prior to the conference call start
time to ensure prompt access to the conference. Dial in details are
as follows:
|
North America: 1
888-390-0546 / +1 416-764-8688 / +1 778-383-7413
|
|
UK: 0800 652 2435
(toll free)
|
|
Other International:
+1 416-764-8688 / +1 778-383-7413
|
The conference call will be available for replay until
August 7, 2015, by calling 1
888-390-0541 / +1 416-764-8677 and entering passcode 928062.
About Nevsun Resources Ltd.
Nevsun Resources Ltd. is a Vancouver-based mining company with an
operating mine in Eritrea. Nevsun's 60%-owned Bisha Mine
ranks as one of the highest grade open pit copper mines in the
world. Nevsun has a strong balance sheet and future cash flows to
grow shareholder value through exploration at Bisha and acquisition
of additional mining assets.
Forward Looking Statements
The above contains forward-looking statements or
forward-looking information within the meaning of the United States
Private Securities Litigation Reform Act of 1995, and applicable
Canadian securities laws. Forward-looking statements are
frequently, but not always, identified by words such as "expects,"
"anticipates," "believes," "intends," "estimated," "potential,"
"possible" and similar expressions, or statements that events,
conditions or results "will," "may," "could" or "should" occur or
be achieved. Forward-looking statements are statements
concerning the Company's current beliefs, plans and expectations
about the future including but not limited to commercial
production, future production of copper and related cash flows and
are inherently uncertain. The actual achievements of the Company or
other future events or conditions may differ materially from those
reflected in the forward-looking statements due to a variety of
risks, uncertainties and other factors, including, without
limitation, the risks that: (i) any of the assumptions in the
historical resource estimates turn out to be incorrect, incomplete,
or flawed in any respect; (ii) the methodologies and models used to
prepare the resource and reserve estimates either underestimate or
overestimate the resources or reserves due to hidden or unknown
conditions, (iii) exploration activities or the mine operations are
disrupted or suspended due to acts of god, internal conflicts in
the country of Eritrea, unforeseen
government actions or other events; (iv) the Company experiences
the loss of key personnel; (v) the Company's operations or
exploration activities are adversely affected by other political or
military, or terrorist activities; (vi) the Company becomes
involved in any material disputes with any of its key business
partners, suppliers or customers; (vii) the Company is subjected to
any hostile takeover or other unsolicited attempts to acquire
control of the Company; (viii) the Company is subject to any
adverse ruling in any of the pending litigation to which it is a
party; (ix) the Company incurs unanticipated power
interruptions or inadequate fuel quality or supply or repairs at
the copper plant to effectively operate power generators for the
plant or otherwise, * the Company experiences shipping delays for
fuel or equipment or replacement parts that are required for
ongoing mining operations or to complete repairs at the copper
plant that could impact mining operations; or (xi)
are associated with the speculative nature of exploration
activities, periodic interruptions to exploration, failure of
drilling, processing and mining equipment, the interpretation of
drill results and the estimation of mineral resources and reserves,
changes to exploration and project plans and parameters and
other risks are more fully described in the Company's Annual
Information Form for the fiscal year ended December 31, 2014, which is incorporated herein
by reference.
Although the Company has attempted to identify important
factors that could cause actual results to differ materially from
those contained in forward-looking statements, there may be other
factors that cause results not to be as anticipated, estimated or
intended. The Company's forward-looking statements are based
on the beliefs, expectations and opinions of management on the date
the statements are made and the Company assumes no obligation to
update such forward-looking statements in the future, except as
required by law. For the reasons set forth above, investors
should not place undue reliance on the Company's forward-looking
statements.
Further information concerning risks and uncertainties
associated with these forward-looking statements and our business
can be found in our Annual Information Form for the year ended
December 31, 2014, which is available
on the Company's website (www.nevsun.com), filed
under our profile on SEDAR (www.sedar.com) and on
EDGAR (www.sec.gov) under cover of Form
40-F.
NEVSUN RESOURCES LTD.
"Cliff T. Davis"
Cliff T. Davis
President & Chief Executive Officer
SOURCE Nevsun Resources Ltd.