Aura Announces Second Quarter 2022 Financial and Operational Results and 2022 Guidance Update
10 August 2022 - 8:00PM
Aura Minerals Inc. (TSX: ORA) (B3: AURA33)
(“
Aura” or the “
Company”)
announces that it has filed unaudited consolidated financial
statements and management discussion and analysis (together,
“Financial and Operational Results”) for the period ended June 30,
2022 (“Q2 2022”) and 2022 Guidance Update (“Guidance”). The full
version of the Financial and Operational Results and the Guidance
can be viewed on the Company’s website at www.auraminerals.com or
on SEDAR at www.sedar.com. All amounts are in U.S. dollars unless
stated otherwise.
Q2 2022 Highlights (Compared to Q2
2021):
- Consolidated
quarterly production of 55,645 of gold equivalent ounces (“GEO1”)
in Q2 2022 and 121,175 GEO for the first half of 2022. Production
is now expected to be in the range of between 260,000 and 275,000
GEO for 2022 full year, within the lower range of the previous
guidance.
- The Company has
returned to its shareholders in the first half of 2022 over $15
million in cash between dividends and share and BDR buybacks, which
represents a yield of 3.4% based on the closing price of the
quarter. During the last 12 months the yield is 6.5%.
- Total production
decreased 7% compared to Q2 2021 (59,834 GEO without Gold Road) due
to temporary lower recoveries at San Andres and working capital
strategy to optimize cash flow at EPP.
- Revenues of
$93,384, an 11% reduction as result of lower production and lower
copper prices (- 3%).
- Gross margins
were $29,006, a 32% decrease, as result of lower production which
also negatively impacted cash costs at EPP and San Andres.
- Adjusted EBITDA
of $30,322, a 29% decrease, driven by lower production.
- Cash flow from
operations was positive in Q2 2022, despite the temporary
challenges; as a result, the consolidated Net Debt is negative at
($10,318) at the end Q2 2022, despite lower production, investments
in the construction of the Almas Project which consumed $10,199 in
cash during the quarter, dividend payment of $10,188 and share
buybacks of $5,388.
- Annual cash
costs are now expected to be in the range of $803 to $853 per oz of
for 2022 full year, compared to the previous guidance of $771 to
$845 per oz. The increase is mainly attributable to the production
reduction at San Andres, while inflationary pressures have been
reasonably offset.
- In April 2022,
Aura entered into an agreement to acquire Big River Gold Limited
(“Big River”) and form a JV with Dundee Resources Limited. The
transaction is subject to certain precedent conditions (see press
release dated April 19, 2022) and expected to close by September
2022.
- In July 2022,
Aura released its 2021 Sustainability Report in accordance with
Global Reporting Initiative (GRI) standards.
- In July 2022,
Aura completed the sale of Gold Road Mine (see press release dated
July 27, 2022). As a result, Gold Road debt of $25,000 was no
longer consolidated at the end of the second quarter, improving the
Net Debt position of the Company.
Rodrigo Barbosa, CEO of Aura, commented:
“Aranzazu and EPP performed above expectations during the first six
months of the year and, despite the challenges with metal
recoveries at the San Andres mine and when added to an expected
higher production during the second half of 2022, Aura expects to
meet its initial production guidance. Moreover, we recently
announced a semi-annual dividend payment and have returned more
than $15 million to our shareholders in the form of dividends and
share and BDR buybacks during the first half of 2022. Finally, we
have been able to maintain our net cash position, which reinforces
our strategy to invest in the growth of the Company while
maintaining our low leverage and paying dividends.”
Operational And Financial
Overview
|
|
|
|
|
|
|
|
For the
threemonths endedJune 30, 2022 |
For the threemonths
endedJune 30, 2021 |
For the
sixmonths endedJune 30, 2022 |
For the sixmonths
endedJune 30, 2021 |
|
Total Production1 (GEO) |
55,645 |
|
63,020 |
|
116,686 |
|
129,801 |
|
|
Sales2 (GEO) |
55,655 |
|
66,842 |
|
121,175 |
|
138,117 |
|
|
Net Revenue |
93,384 |
|
105,098 |
|
205,660 |
|
213,098 |
|
|
Adjusted EBITDA |
30,322 |
|
42,592 |
|
80,534 |
|
94,974 |
|
|
Cash costs per GEO sold |
998 |
|
854 |
|
900 |
|
787 |
|
|
Ending Cash balance |
217,938 |
|
97,880 |
|
|
|
|
Net Debt |
(10,318 |
) |
(7,062 |
) |
|
|
|
Recurring Capex |
(12,060 |
) |
(17,262 |
) |
(21,567 |
) |
(36,880 |
) |
|
|
|
|
|
|
|
1 Considers capitalized production |
|
|
|
|
|
2 Does not consider capitalized production |
|
|
|
|
Guidance Update
Aura is maintaining its second half and full
year 2022 production guidance; however, the Company has narrowed
the range to 260,000 to 275,000 oz for 2022 full year, compared to
260,000 and 290,000 oz as expected previously. Factors that
contributed to narrowing the range:
- Six months of
actual results;
- Increased
production at EPP and Aranzazu to between 70,000-75,000 and
115,000-120,000 GEO respectively, as result of better-than-expected
production in the first half of the year. Production at EPP is
expected to remain strong and above expectation in H2 2022 as it
reaches the high-grade Elephant Zone at the Ernesto pit; and
- Temporary lower
recoveries at San Andres during the first half of the year,
resulting in average production of 5,867 ounces. Production is now
estimated to be between 75,000 – 80,000 Ozs (previously 88,000 –
99,000 Ozs), though recoveries in June have improved, and
production of 7,232 ounces of gold was achieved, above the average
of first half and consistent with the guidance expectation for the
second half of 2022.
The table below details the Company’s updated
GEO production guidance for 2022 by business unit:
|
|
|
|
|
|
Production
('000 GEO)2022 |
|
|
Updated |
Previous |
|
Aranzazu |
115 -
120 |
108
-120 |
|
EPP
Mines |
70 -
75 |
64 -
71 |
|
San
Andrés |
75 -
80 |
88 -
99 |
|
Total |
260 - 275 |
260 - 290 |
|
|
|
|
The table below details the Company’s updated for
Cash Cost guidance for 2022 by business unit:
|
|
Cash Cost
per GEO2022 |
|
|
Updated |
Previous |
|
Aranzazu |
645 -
690 |
637 -
704 |
|
EPP
Mines |
955 -
992 |
923 -
992 |
|
San
Andrés |
910 -
980 |
825 -
912 |
|
Total |
803 - 853 |
771 - 845 |
Non-GAAP Measures
In this press release, the Company has included
Adjusted EBITDA, cash operating costs per gold equivalent ounce
sold and net debt which are non-GAAP measures. These non-GAAP
measures do not have any standardized meaning within IFRS and
therefore may not be comparable to similar measures presented by
other companies. The Company believes that these measures provide
investors with additional information which is useful in evaluating
the Company’s performance and should not be considered in isolation
or as a substitute for measures of performance prepared in
accordance with IFRS. The below tables provide a reconciliation of
the non-GAAP measures presented:
Reconciliation from Income for the Quarter for EBITDA
and Adjusted EBITDA:
|
|
|
|
|
|
|
For the threemonths endedJune 30, 2022 |
For the threemonths endedJune 30, 2021 |
For the sixmonths endedJune 30, 2022 |
For the sixmonths endedJune 30, 2021 |
|
Profit (loss) from continued operation |
$ |
3,675 |
|
$ |
26,034 |
|
$ |
43,864 |
|
$ |
50,694 |
|
|
Income tax
(expense) recovery |
|
7,259 |
|
|
7,869 |
|
|
20,985 |
|
|
17,129 |
|
|
Deferred
income tax (expense) recovery |
$ |
972 |
|
$ |
3,041 |
|
$ |
(3,084 |
) |
$ |
10,030 |
|
|
Finance
costs |
|
9,266 |
|
|
(1,272 |
) |
|
(286 |
) |
|
1,382 |
|
|
Other gains
(losses) |
$ |
232 |
|
$ |
(1,519 |
) |
$ |
1,075 |
|
$ |
(1,131 |
) |
|
Depreciation |
|
8,918 |
|
|
8,439 |
|
|
17,980 |
|
|
16,870 |
|
|
EBITDA |
|
30,322 |
|
|
42,592 |
|
|
80,534 |
|
|
94,974 |
|
|
Impairment |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
ARO
Change |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
Adjusted EBITDA |
$ |
30,322 |
|
$ |
42,592 |
|
$ |
80,534 |
|
$ |
94,974 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation
from the consolidated financial statements to cash operating costs
per gold equivalent ounce sold: |
|
|
|
|
|
|
|
|
For the
threemonths endedJune 30, 2022 |
For the threemonths
endedJune 30, 2021 |
For the
sixmonths endedJune 30, 2022 |
For the sixmonths
endedJune 30, 2021 |
|
Cost of
goods sold |
|
(64,378 |
) |
|
(62,361 |
) |
|
(126,974 |
) |
|
(119,164 |
) |
|
Depreciation |
$ |
8,861 |
|
$ |
8,400 |
|
$ |
17,870 |
|
$ |
16,779 |
|
|
COGS
w/o Depreciation |
|
(55,517 |
) |
|
(53,961 |
) |
|
(109,104 |
) |
|
(102,385 |
) |
|
Gold Equivalent Ounces sold(1) |
$ |
55,655 |
|
$ |
63,168 |
|
$ |
121,175 |
|
$ |
130,079 |
|
|
Cash
costs per gold equivalent ounce sold |
$ |
998 |
|
$ |
854 |
|
$ |
900 |
|
$ |
787 |
|
|
|
|
|
|
|
|
(1) Do not considers
pre-commercial production and sale, capitalized |
|
|
Reconciliation Net Debt:
|
|
|
June
30,2022 |
December
31,2021 |
|
Short Term Loans |
|
60,284 |
|
|
58,169 |
|
|
Long-Term Loans |
$ |
155,761 |
|
$ |
99,862 |
|
|
Plus / (Less): Derivative Financial Instrument |
|
|
(7,825 |
) |
|
2,779 |
|
|
Less: Cash and Cash Equivalents |
$ |
(217,938 |
) |
$ |
(161,490 |
) |
|
Less: Restricted Cash |
|
(600 |
) |
|
(944 |
) |
|
Net
Debt |
|
|
(10,318 |
) |
|
(1,624 |
) |
|
|
|
|
|
About Aura 360° Mining
Aura is focused on mining in complete terms –
thinking holistically about how its business impacts and benefits
every one of our stakeholders: our company, our shareholders, our
employees, and the countries and communities we serve. We call this
360° Mining.
Aura is a mid-tier gold and copper production
company focused on the development and operation of gold and base
metal projects in the Americas. The Company’s producing assets
include the San Andres gold mine in Honduras, the Ernesto/Pau-a
-Pique gold mine in Brazil and the Aranzazu copper-gold-silver mine
in Mexico. In addition, the Company has two additional gold
projects in Brazil, Almas and Matupá, and one gold project in
Colombia, Tolda Fria.
For further information, please visit Aura’s website at
www.auraminerals.com or contact:
Rodrigo BarbosaPresident &
CEO305-239-9332
Forward-Looking Information
This press release contains “forward-looking
information” and “forward-looking statements”, as defined in
applicable securities laws (collectively, “forward-looking
statements”) which include, without limitation, expected production
from, and the further potential of the Company’s properties,
anticipated cash costs per GEO produced, the ability of the Company
to achieve its short-term and longer-term outlook, and the
completion of the acquisition of Big River. Known and unknown
risks, uncertainties and other factors, many of which are beyond
the Company’s ability to predict or control, could cause actual
results to differ materially from those contained in the
forward-looking statements if such risks, uncertainties or factors
materialize. Forward-looking statements are necessarily based upon
a number of estimates and assumptions that, while considered
reasonable by the Company, are inherently subject to significant
business, economic and competitive uncertainties and contingencies.
Specific reference is made to the Company’s most recent Annual
Information Form on file with certain Canadian provincial
securities regulatory authorities for a discussion of some of the
factors underlying forward-looking statements, which include,
without limitation the ability of the Company to achieve its
short-term and longer-term outlook and the anticipated timing and
results thereof, the ability to lower costs and increase
production, the ability of the Company to successfully achieve
business objectives, copper and gold or certain other commodity
price volatility, changes in debt and equity markets, the
uncertainties involved in interpreting geological data, increases
in costs, environmental compliance and changes in environmental
legislation and regulation, interest rate and exchange rate
fluctuations, general economic conditions and other risks involved
in the mineral exploration and development industry. Readers are
cautioned that the foregoing list of factors is not exhaustive of
the factors that may affect the forward-looking statements.
_____________________
1 Gold equivalent ounces, or GEO, is calculated
by converting the production of silver and copper into gold using a
ratio of the prices of these metals to that of gold. The prices
used to determine the gold equivalent ounces are based on the
weighted average price of silver and copper realized from sales at
the Aranzazu Complex during the relevant period.
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