/NOT FOR DISSEMINATION OR DISTRIBUTION IN
THE UNITED STATES AND NOT FOR
DISTRIBUTION TO US NEWSWIRE SERVICES./
(All financial figures in US Dollars unless
otherwise stated)
MELBOURNE, Feb. 23, 2017 /CNW/ - OceanaGold Corporation
(TSX/ASX: OGC) (the "Company") is pleased to release its full year
2016 financial and operational results for the year ended
31 December 2016. This follows the
Company's release of its operational results on 30 January 2017. Details of the consolidated
financial statements and the Management Discussion and Analysis
("MD&A") are available on the Company's website at
www.oceanagold.com
Key Highlights
- Achieved record full year revenue of $628.6 million and net profit of $136.5 million.
- Reported quarterly revenue of $147.4
million and net profit of $42.6
million in the fourth quarter.
- Achieved EBITDA of $283.6 million
for the full year and $66.9 million
for the fourth quarter.
- Declared semi-annual dividend of $0.01 per common share or CDI to shareholders,
reflecting continued strong performance.
- Maintained strong balance sheet with immediate liquidity of
$96.1 million including $68.9 million in cash.
- Achieved full year gold production guidance range with 416,741
ounces of gold produced and slightly exceeded the top end of the
copper guidance range with 21,123 tonnes produced.
- Reported consolidated full year All-In Sustaining Costs of
$708 per ounce and cash costs of
$452 per ounce on sales of 437,146
ounces of gold and 21,413 tonnes of copper.
- Subsequent to the quarter end, signed a letter of intent to
enter into a joint venture with Mirasol Resources Ltd, which owns
the La Curva Gold Project in Argentina.
Mick Wilkes, President and CEO
said, "OceanaGold achieved strong financial results from our
portfolio of high quality assets in 2016. With growth in production
and higher margins expected in 2017, we are further strengthening
our financial results and balance sheet. On the back of these
results, the Board of Directors is pleased to declare a semi-annual
ordinary dividend of $0.01 per
share." He added, "We expect this year to unlock significant growth
opportunities in the business particularly in New Zealand and the
United States. Commissioning of Haile continues to advance
well and we expect to announce commercial production early in the
second quarter. We will continue to create value through
exploration supported by a larger exploration spend in New Zealand and the
United States. We will also complete studies for the
potential expansion of Haile and the exciting Martha project at
Waihi."
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Table 1 –
Production and Cost Results Summary
|
|
|
Didipio
|
Waihi
|
Macraes
and
Reefton
|
Consolidated
|
Fourth Quarter
2016 Results
|
Q4
2016
|
Q3
2016
|
Gold
Produced
|
ounces
|
30,695
|
29,280
|
42,453
|
102,428
|
88,975
|
Copper
Produced
|
tonnes
|
3,765
|
-
|
-
|
3,765
|
5,114
|
Gold Sales
|
ounces
|
35,260
|
27,665
|
42,733
|
105,658
|
98,195
|
Copper
Sales
|
tonnes
|
4,960
|
-
|
-
|
4,960
|
5,596
|
Cash Costs
|
$ per
ounce
|
(120)
|
427
|
743
|
372
|
529
|
2016
Results
|
2016
|
20151
|
Gold
Produced
|
ounces
|
147,150
|
116,028
|
153,563
|
416,741
|
419,153
|
Copper
Produced
|
tonnes
|
21,123
|
-
|
-
|
21,123
|
23,109
|
Gold Sales
|
ounces
|
149,663
|
116,169
|
171,314
|
437,146
|
401,350
|
Copper
Sales
|
tonnes
|
21,413
|
-
|
-
|
21,413
|
22,764
|
Cash Costs
|
$ per
ounce
|
1
|
473
|
832
|
452
|
458
|
All-In Sustaining
Costs
|
$ per
ounce
|
239
|
735
|
1,099
|
708
|
709
|
Notes:
|
1. includes
the actual results for Waihi Gold for the six months ended December
31,2015. This disclosure is for information only, reflecting
what the costs would have been, had the legal close of the Waihi
Gold acquisition been on July 1, 2015.
|
Table 2 –
Financial Summary*
|
$'000
|
Q4
Dec
31
2016
|
Q3
Sep
30
2016
|
Q4
Dec
31
2015
|
2016
|
2015
|
Revenue
|
147,432
|
150,388
|
143,612
|
628,634
|
507,985
|
Cost of sales,
excluding depreciation and amortisation
|
(63,406)
|
(77,524)
|
(71,080)
|
(292,461)
|
(265,058)
|
General &
administration – merger and acquisition
|
-
|
-
|
(1,604)
|
-
|
(8,522)
|
General &
administration** – legal settlement
|
(8,000)
|
-
|
-
|
(8,000)
|
-
|
General &
administration – other
|
(10,203)
|
(11,361)
|
(11,743)
|
(49,497)
|
(36,806)
|
Foreign currency
exchange gain/(loss)
|
(547)
|
(604)
|
(173)
|
2,117
|
(2,802)
|
Other
income/(expense)
|
1,614
|
669
|
(1,443)
|
2,826
|
(1,309)
|
Earnings before
interest, tax, depreciation and
amortisation
(EBITDA) (excluding gain/(loss) on
undesignated
hedges)
|
66,890
|
61,568
|
57,569
|
283,619
|
193,488
|
Depreciation and
amortisation
|
(28,807)
|
(31,973)
|
(36,164)
|
(122,564)
|
(124,960)
|
Net interest expense
and finance costs
|
(2,112)
|
(2,538)
|
(5,001)
|
(9,376)
|
(12,051)
|
Earnings before
income tax and gain/(loss) on
undesignated
hedges
|
35,971
|
27,057
|
16,404
|
151,679
|
56,477
|
Tax (expense) /
benefit on earnings
|
(4,318)
|
(2,587)
|
(5,654)
|
(17,711)
|
461
|
Earnings/(loss)
after income tax and before
gain/(loss) on
undesignated hedges
|
31,653
|
24,470
|
10,750
|
133,968
|
56,939
|
Gain/(loss) on fair
value undesignated hedges
|
15,343
|
8,852
|
16,525
|
4,062
|
(5,379)
|
Tax (expense)/benefit
on gain/loss on undesignated
hedges
|
(4,296)
|
(2,478)
|
(4,627)
|
(1,137)
|
1,506
|
Share of
profit/(loss) from equity accounted
associates
|
(126)
|
(151)
|
-
|
(441)
|
-
|
Net
Profit
|
42,574
|
30,693
|
22,648
|
136,452
|
53,066
|
Basic earnings per
share
|
$0.07
|
$0.05
|
$0.04
|
$0.22
|
$0.14
|
CASH
FLOWS
|
|
|
|
|
|
Cash flows from
Operating Activities
|
79,765
|
29,440
|
62,152
|
232,328
|
171,441
|
Cash flows used in
Investing Activities
|
(120,698)
|
(116,342)
|
(41,008)
|
(463,276)
|
(125,501)
|
Cash flows from /
(used in) Financing Activities
|
26,116
|
70,607
|
120,529
|
111,583
|
89,932
|
Notes:
*: includes
results for Romarco Minerals and Waihi Gold from 1 and 30 October
2015 respectively.
**: reflects
expensed costs of $8 million following the arbitration ruling
against Pacific Rim by the International Centre for
the Settlement of Investment
Disputes.
|
In 2016, the Company achieved record annual revenue of
$628.6 million, which was 24% higher
than in the previous year on account of higher gold sales and an 8%
increase in the average gold price received. The year-on-year
increase was partly offset by lower copper sales. Full year EBITDA
increased by 46% from the previous year to $283.6 million driven primarily by stronger
revenue, but partially offset by higher mining costs at the
New Zealand operations and higher
general and administrative ("G&A") costs. The higher G&A
costs included a one-off charge of $8.0
million for legal settlement costs related to the
El Salvador arbitration ruling
against the Company.
The Company also achieved record annual net profit, which
increased by 157% from the previous year due to higher EBITDA,
lower interest costs and gain on the fair value of undesignated
hedges. The increase was partly offset by higher income tax
expense.
At the end of 2016, the Company had immediate available
liquidity of $96.1 million which
included a cash balance of $68.9
million and $27.2 million
available under the $300 million
revolving credit facility. During the fourth quarter, the Company
drew down $30.0 million from its
revolving credit facility to fund capital works at Haile and repaid
$3.9 million of capital leases.
Dividend
In 2015, the OceanaGold Board of Directors (the "Board")
established a dividend policy designed to balance the competing
priorities for the business with a sustainable payment to
shareholders while maintaining prudent gearing. Under this policy,
an ordinary dividend of $0.02 per
share plus a discretionary payment would be paid annually. The
Board has now resolved to move to a semi-annual dividend that would
be declared following the December and June quarters. Consistent
with the dividend policy of a base dividend of US$0.02 per annum, the Board today has declared a
dividend of US$0.01 per common share
or CDI. Shareholders of record at the close of business in each
jurisdiction on 7 March 2017 (the
"Record Date") will be entitled to receive payment of the dividend
on 28 April 2017. The dividend
payment applies to holders of record of the Company's common shares
traded on the Toronto Stock Exchange and holders of CHESS
depository interests traded on the Australian Securities Exchange
("CDIs").
Table 3 – Dividend
Key Dates
|
|
Date
|
Last date for
processing requests to convert securities between stock
exchanges before the
Record Date1
|
Wednesday, 1 March
2017
|
Common shares trade
on an ex-dividend basis (TSX)
|
Friday, 3 March
2017
|
CDIs trade on an
ex-dividend basis (ASX)
|
Monday, 6 March
2017
|
Record
Date
|
Tuesday, 7 March
2017
|
Processing
recommences for requests to convert securities between
stock
exchanges1
|
Wednesday, 8 March
2017
|
Dividend Payment
Date
|
Friday, 28 April
2017
|
This year, at the election of the security holder, the Company
will pay the dividend in US Dollars, Australian Dollars, New
Zealand Dollars or British Pounds Sterling for ASX listed CDIs, and
US Dollars, Canadian Dollars or British Pounds Sterling for TSX
listed common shares. Please refer to the end of this media release
for important information relating to Australian income tax and
Canadian withholding tax.
Other Investments
Subsequent to the year end, the Company signed a letter of
intent (LOI) to enter into a joint venture with Mirasol Resources
Ltd., a Canadian exploration company, enabling OceanaGold to
acquire up to a maximum 75% interest in the La Curva Gold Project
by completing various exploration and financial conditions. The
Project is located in Santa Cruz;
a highly prospective gold province in southern Argentina.
Philippines Update
Further to the Company news release dated 14 February 2017, the Department of Environment
and Natural Resources ("DENR") Order remains under appeal with the
Office of the President in the
Philippines. The Didipio mine continues to operate without
interruption.
2016 Full Year Results Webcast
The Company will host a conference call / webcast to discuss the
results at 8:30am on Friday
24 February 2017 (Melbourne, Australia time) / 4:30pm on Thursday 23
February 2017 (Toronto,
Canada time).
Webcast Participants
To register, please copy and paste the link below into your
browser:
http://event.on24.com/r.htm?e=1349552&s=1&k=3A9B5447E56F208E102F5CD308EF4EBC
Teleconference Participants (required for those who wish to
ask questions)
Local (toll free) dial in numbers are:
Australia: 1 800 076 068
New Zealand: 0 800 453 421
Canada & North America: 1 888 390 0546
All other countries (toll): + 1 416 764 8688
Playback of Webcast
If you are unable to attend the call, a recording will be
available for viewing on the Company's website a few hours after
the completion of the webcast.
___________________________
1 The Company will seek and expects to be granted a
temporary waiver of the relevant ASX Settlement Operating Rules.
Under the waiver, the processing of transfers of Common Shares and
CDIs between stock exchanges, lodged on or after 1 March 2017, will
be deferred until after the Record Date of 7 March 2017.
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About OceanaGold
OceanaGold Corporation is a mid-tier, high-margin, multinational
gold producer with assets located in the
Philippines, New Zealand
and the United States. The
Company's assets encompass its flagship operation, the Didipio
Gold-Copper Mine located on the island of Luzon in the Philippines. On the North Island of
New Zealand, the Company operates
the high-grade Waihi Gold Mine while on the South Island of
New Zealand, the Company operates
the largest gold mine in the country at the Macraes Goldfield which
is made up of a series of open pit mines and the Frasers
underground mine. In the United
States, the Company is currently commissioning the Haile
Gold Mine, a top-tier asset located in South Carolina along the Carolina Terrane. The
Company expects the Haile Gold Mine to commence commercial
production early in the second quarter of 2017. OceanaGold also has
a significant pipeline of organic growth and exploration
opportunities in the Americas and Asia-Pacific regions.
OceanaGold has operated sustainably over the past 26 years with
a proven track record for environmental management and community
and social engagement. The Company has a strong social license to
operate and works collaboratively with its valued stakeholders to
identify and invest in social programs that are designed to build
capacity and not dependency.
In 2017, the Company expects to produce 550,000 to 610,000
ounces of gold and 15,000 to 17,000 tonnes of copper with sector
leading All-In Sustaining Costs that range from $600 to $650 per ounce sold.
Tax Information for Dividend
Australian Income Tax
For Australian income tax purposes, the dividend is unfranked
and there is no amount of Conduit Foreign Income per security for
this dividend payment.
Canadian Withholding Tax
Holders of Common Shares or CDIs are advised that this dividend
is designated by the Company to be an "eligible dividend" pursuant
to subsection 89(14) of the Income Tax Act (Canada) and corresponding provincial
legislation. As the dividend originates from Canada, withholding tax at the rate of 25%
will be deducted from dividends paid to non-Canadian residents
unless the shareholder or CDI holder is a resident of a country
with a tax treaty with Canada, in
which event a lower withholding rate may apply. Such shareholders
or CDI holders must certify their non-resident status by completing
the relevant forms required by the Canada Revenue Agency. The
Company will mail every holder further information following the
Record Date.
Information contained in this media release is based on the
directors' current expectations and may be subject to change. If
any of the dates should change, the revised dates will be announced
by media release and will be available from www.oceanagold.com.
Cautionary Statement for Public Release
Certain information contained in this public release may be
deemed "forward-looking" within the meaning of applicable
securities laws. Forward-looking statements and information relate
to future performance and reflect the Company's expectations
regarding the generation of free cash flow, execution of business
strategy, future growth, future production, estimated costs,
results of operations, business prospects and opportunities of
OceanaGold Corporation and its related subsidiaries. Any statements
that express or involve discussions with respect to predictions,
expectations, beliefs, plans, projections, objectives, assumptions
or future events or performance (often, but not always, using words
or phrases such as "expects" or "does not expect", "is expected",
"anticipates" or "does not anticipate", "plans", "estimates" or
"intends", or stating that certain actions, events or results
"may", "could", "would", "might" or "will" be taken, occur or be
achieved) are not statements of historical fact and may be
forward-looking statements. Forward-looking statements are subject
to a variety of risks and uncertainties which could cause actual
events or results to differ materially from those expressed in the
forward-looking statements and information. They include, among
others, the accuracy of mineral reserve and resource estimates and
related assumptions, inherent operating risks and those risk
factors identified in the Company's most recent Annual Information
Form prepared and filed with securities regulators which is
available on SEDAR at www.sedar.com under the Company's name. There
are no assurances the Company can fulfil forward-looking statements
and information. Such forward-looking statements and information
are only predictions based on current information available to
management as of the date that such predictions are made; actual
events or results may differ materially as a result of risks facing
the Company, some of which are beyond the Company's control.
Although the Company believes that any forward-looking statements
and information contained in this press release is based on
reasonable assumptions, readers cannot be assured that actual
outcomes or results will be consistent with such statements.
Accordingly, readers should not place undue reliance on
forward-looking statements and information. The Company expressly
disclaims any intention or obligation to update or revise any
forward-looking statements and information, whether as a result of
new information, events or otherwise, except as required by
applicable securities laws. The information contained in this
release is not investment or financial product advice.
SOURCE OceanaGold Corporation