(All figures are in US dollars unless otherwise expressed)
TSX-V: JAG
TORONTO, Aug. 13, 2015 /CNW/ - Jaguar Mining Inc.
("Jaguar" or the "Company") (JAG: TSX-V) today announced its
operational and financial results for the second quarter ended
June 30, 2015.
Q2 2015 FINANCIAL & OPERATING HIGHLIGHTS
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($ thousands, except
where indicated)
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For the three
months ended
June 30,
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For the six months
ended
June 30,
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2015
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2014
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2015
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2014
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Financial
Data
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Revenue
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$
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22,820
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$
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31,044
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$
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51,567
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$
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62,143
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Cost of sales
(excluding depreciation)1
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16,808
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23,274
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36,941
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44,610
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Gross margin
(excluding depreciation)1
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6,012
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7,770
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14,626
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17,533
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Net (loss)
income
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(4,383)
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246,646
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(17,328)
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230,888
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Per share
("EPS")
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(0.04)
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2.92
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(0.16)
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5.37
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EBITDA1
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(137)
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257,402
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(1,646)
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255,402
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Adjusted
EBITDA2
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500
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(2,911)
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7,557
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(3,401)
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Sustaining capital
expenditures1
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3,052
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4,830
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8,327
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8,653
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Non-sustaining
capital expenditures1
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144
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180
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250
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650
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Total Capital
Expenditures3
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3,196
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5,010
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8,577
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9,303
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Operating
Data
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Average realized gold
price ($ per ounce)1
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$
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1,190
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$
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1,280
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$
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1,188
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$
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1,290
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Gold sold
(ounces)
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19,184
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24,002
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43,412
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48,183
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Gold produced
(ounces)
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20,682
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23,867
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42,018
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47,226
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Definition drilling
(meters)
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11,416
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10,121
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20,384
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17,536
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Cash operating costs
(per ounce produced)1
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$
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796
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$
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958
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$
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802
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$
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941
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Cash operating costs
(per ounce sold)1
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$
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876
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$
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970
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$
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851
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$
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926
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All-in sustaining
costs (per ounce sold)1
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$
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1,231
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$
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1,337
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$
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1,198
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$
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1,276
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1 Average
realized gold price, sustaining and non-sustaining capital
expenditures, cash operating costs and all-in sustaining
costs,
EBITDA and Adjusted
EBITDA, cost of sales (excluding depreciation) and gross margin
(excluding depreciation) are non-gaap financial
performance measures
with no standard definition under IFRS. Refer to the Non-IFRS
Financial Performance Measures section of the
MD&A.
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2 Adjusted
EBITDA excludes non-cash items such as impairment and write downs.
For more details refer to the Non-IFRS Performance
Measures section of
the MD&A.
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3 These
amounts are presented on accrual basis. Capital expenditures are
included in our calculation of all-in sustaining costs.
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Cash and Gold
Bullion
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($
thousands)
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June 30,
2015
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December 31,
2014
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Cash and
equivalents
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$
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4,776
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$
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7,161
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Gold
bullion
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1,624
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1,801
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Total cash and gold
bullion
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$
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6,400
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$
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8,962
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Financial Highlights
- Revenues during the second quarter and first half of 2015 were
$22.8 million and $51.6 million respectively, compared with
revenues of $31.0 million and 62.1
for the corresponding 2014 periods;
- The average realized gold price per ounce during the second
quarter of 2015 was $1,190, compared
to $1,280 for the corresponding 2014
period;
- Sales of gold during the second quarter and first half of 2015
were 19,184 and 43,412 ounces respectively, compared to sales of
24,002 and 48,183 ounces during the corresponding 2014
periods;
- Adjusted EBITDA for the second quarter and first half of 2015
was $0.5 million and $7.6 million respectively, compared to negative
$2.9 million and negative
$3.4 million for the same periods in
2014;
- In addition to the $6.0 million
federal tax cash refund in the first quarter of 2015, the Company
received another cash refund of $1.3
million (approximately R$4.0
million) in the second quarter in respect of Federal Taxes
for its Mineração Serras do Oeste Ltda ("MSOL") operating
subsidiary;
- Total debt outstanding as at June 30,
2015 was $24.9 million (of
which $8.4 million is senior secured
facility), compared to $31.0 million
as at December 31, 2014;
- As per the terms of the senior secured credit agreement with
Global Resource Fund ("Renvest"), the Company was obligated to make
a scheduled $1.0 million principal
payment on July 28, 2015, which has
been, upon agreement between the parties, postponed to August 28, 2015. The Company has
engaged in and continues to be in discussions with Renvest about
financing and Credit Agreement matters;
- The results of our operations are affected by the foreign
currency movements of the Brazilian Reais and Canadian dollar,
versus the US dollar. Approximately 90% of our expenditures in
Brazil and 95% of our expenditures
for the head office in Toronto are
denominated in Brazilian Reais and Canadian dollars, respectively.
Therefore cash flows are sensitive to any movements in Brazilian
Reais and Canadian dollar, as compared to the US dollar. Since the
Company reports its earnings in US dollars, any weakening of the
Brazilian Reais and Canadian dollar results in a reduction in US
dollar denominated costs, while revenues are unaffected given all
revenue is earned in US dollars. The Brazilian Reais averaged at
R$3.07 per US$ in the second quarter
of 2015 compared to R$2.23 per US$ in
the same period last year;
- As at June 30, 2015 the Company
had cash and unsold gold bullion on hand of $6.4 million ($9.0
million as at December 31,
2014).
Cash Operating Costs, Capital Expenditures and
All-in-sustaining Costs
- During second quarter of 2015, cash operating costs per ounce
of gold produced were $796 compared
to $958 during the same period in
2014, a decrease of $162 per ounce or
17%;
- For the first half of 2015, cash operating costs per ounce of
gold produced was $802 compared to
$941 during the same period in 2014,
a decrease of $139 per ounce or
15%;
- During the second quarter of 2015, all-in sustaining costs per
ounce sold (AISC) were $1,231
compared to $1,337 per ounce during
for the corresponding 2014 period, a decrease of $106 per ounce or 8%;
- AISC for the first half of 2015 were $1,198 per ounce sold, which was 6% or
$78 per ounce lower as compared to
1,276 for the same period in 2014;
- In the second quarter of 2015, sustaining capital expenditures
decreased $1.7 million or 37% to
$3.1 million compared to $4.8 million during the corresponding 2014
period, primarily due to the suspension of primary development at
the Caeté Complex and lower capital expenditures on machinery and
equipment. Capital expenditures for the first half of 2015 were
marginally lower than the same 2014 period.
Operational Highlights
Production
- Production of gold during the second quarter and first half of
2015 was 20,682 ounces 42,018 ounces respectively, compared to
23,867 ounces and 47,226 ounces in the corresponding 2014 periods:
- Turmalina produced 10,420 ounces of gold in the second quarter
of 2015 compared to 13,190 ounces in the 2014 corresponding
period,
- Caeté produced 10,262 ounces of gold in the second quarter of
2015 compared to 10,677 in the 2014 corresponding period.
- A total of 210,000 tonnes was processed in the second quarter
of 2015 (second quarter of 2014: 263,000 tonnes) at an average head
grade of 3.41 grams per tonne (second quarter of 2014 – 3.11 grams
per tonne), a 10% increase compared to the same period in 2014:
- Turmalina processed 94,000 tonnes (second quarter of 2014:
107,000 tonnes) at an average head grade of 3.91 grams per tonne
(second quarter of 2014: 4.14 grams per tonne)
- Caeté processed 116,000 tonnes (second quarter of 2014: 156,000
tonnes) at an average head grade of 3.0 grams per tonne (second
quarter of 2014: 2.4 grams per tonne)
- A total of 436,000 tonnes was processed during the first half
of 2015 (YTD 2014: 531,000 tonnes) at an average head grade of 3.34
grams per tonne (YTD 2014 – 3.0 grams per tonne), an increase of
11% compared to the second quarter of 2014.
- Total tonnes mined decreased in the second quarter and first
half of 2015 by 20% and 18% respectively, compared to the same
periods in 2014, primarily due to focus on higher grade.
- For the second quarter and first half of 2015, the average gold
recovery rate was 90%, compared to 88% for the comparable 2014
periods.
Exploration Drilling and Turmalina Reserve Update
- During the second quarter of 2015, 11,416 meters of exploration
and definition drilling was conducted at both the Turmalina and
Pilar mines, compared to 10,121 meters drilled in the corresponding
2014 period.
- In April 2015, the Company
announced the initial results from its ongoing exploration drilling
campaign:
- Turmalina: On April 8, 2015, the
Company announced multiple high-grade drill intercepts generated
within the current indicated resource envelope. Significant drill
intercepts include 23.71 grams per tonne Au ("g/t Gold") over 14
meters, including 41.27 grams per tonne Au over 7.6 meters, 23.62
grams per tonne Au over 8.8 meters and 20.15 grams per tonne Au
over 8.7 meters.
- Pilar: On April 27, 2015, the
Company announced multiple high-grade drill intercepts, including
18.22 grams per tonne Au ("g/t Gold") over 7.4 meters, 14.04 grams
per tonne Au over 8.7 meters, 10.63 grams per tonne Au over 13.6
meters, 20.98 grams per tonne Au over 3.7 meters and 18.22 grams
per tonne Au over 7.4 meters, including 27.19 grams per tonne Au
over 4.3 meters.
- In April 2015, the Company filed
the National Instrument 43-101 ("NI 43-101") compliant reserve and
resource estimate for the Turmalina mine. The reserves increased by
51% to 217,000 ounces. The drill data base cut-off date for the
reserve estimate was June 30, 2014.
Reserves were calculated at $1,200
per ounce and at R$ 2.5 to US$ 1
exchange rate.
2015 Guidance
compared to 2015 Actual YTD
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2015
Guidance
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Actual
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Low
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High
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YTD
2015
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Consolidated
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Brazilian Reais vs US
dollar foreign exchange rate
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2.5
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2.5
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3.0
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Gold production
(ounces)
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92,000
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102,000
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42,018
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Milling grade (grams
per tonne)
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3.30
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3.75
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3.33
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Tonnes
Processed
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925,000
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1,025,000
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436,000
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Recovery
rate
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89%
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90%
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90%
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Cash operating costs
(per ounce produced)1
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$
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800
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$
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900
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$
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802
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All-in sustaining
costs (per ounce sold)1
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$
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1,100
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$
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1,200
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$
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1,198
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Definition/delineation drilling
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34,000
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34,000
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20,384
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Turmalina
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Gold production
(ounces)
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56,000
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62,000
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22,216
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Milling grade (grams
per tonne)
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4.00
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4.25
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3.74
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Tonnes
Processed
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475,000
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525,000
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205,000
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Recovery
rate
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90%
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91%
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90%
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Cash operating costs
(per ounce produced)1
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$
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640
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$
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700
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$
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652
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All-in sustaining
costs (per ounce sold)1
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$
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900
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$
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1,000
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$
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979
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Definition/delineation drilling
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25,000
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25,000
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10,469
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Caeté
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Gold production
(ounces)
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36,000
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40,000
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19,802
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Milling grade (grams
per tonne)
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2.40
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2.90
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2.96
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Tonnes
Processed
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450,000
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500,000
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231,000
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Recovery
rate
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89%
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90%
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89%
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Cash operating costs
(per ounce produced)1
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$
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1,075
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$
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1,175
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$
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970
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All-in sustaining
costs (per ounce sold)1
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$
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1,200
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$
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1,300
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$
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1,113
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Definition/delineation drilling
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9,000
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9,000
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9,915
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1 Cash
operating costs and all-in sustaining costs are non-gaap financial
performance measures with no standard definition under IFRS.
Refer to the Non-IFRS Financial Performance Measures section of the
MD&A.
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George Bee, President and Chief
Executive Officer of Jaguar commented, "In the second quarter, a
further $3.2 million in debt was
repaid which now brings debt repayment to a total of $13.6 million over the last 12
months. We continue to see success with our
brownfield exploration program confirming ore body continuity and
better grades ahead of mining. The turnaround of our active mining
operations continues and despite short-term production
interruptions at Turmalina, our cash operating cost per ounce
performance improved. Offsetting lower US dollar denominated gold
prices, we have benefitted from a weaker Brazilian Real. We
continue to implement changes that will lead to sustained
profitability and free-cash-flow."
Qualified Person
Scientific and technical information
contained in this press release has been reviewed and approved by
Marcos Dias Alvim, BSc Geo., MAusIMM (CP), Project Development
Manager, who is an employee of Jaguar Mining Inc., and is a
'qualified person' as defined by NI43-101.
About Jaguar Mining Inc.
Jaguar is a gold producer
with mining operations in a prolific greenstone belt in the state
of Minas Gerais, Brazil.
Additionally, Jaguar wholly owns the large-scale Gurupi Development
Project in the state of Maranhão, Brazil. In total, the Company owns mineral
claims covering an area of approximate 197,000-hectares. Additional
information is available on the Company's website at
www.jaguarmining.com.
FORWARD-LOOKING STATEMENTS
Certain statements in
this press release constitute "Forward-Looking Statements" within
the meaning of the U.S. Private Securities Litigation Reform Act of
1995 and applicable Canadian securities legislation.
Forward-looking statements include, but are not limited to,
management's assessment of Jaguar's future plans and operation.
Certain statements throughout this press release constitute
forward-looking statements (forecasts) under applicable securities
laws relating to future events or future performance.
Forward-Looking Statements can be identified by the use of words
such as "are expected", "is forecast", "is targeted",
"approximately", "plans", "anticipates" "projects", "anticipates",
"continue", "estimate", "believe" or variations of such
words and phrases or statements that certain actions, events or
results "may", "could", "would", "might", or "will" be taken, occur
or be achieved. Forward-Looking Statements involve known and
unknown risks, uncertainties and other factors, which may cause the
actual results or performance to be materially different from any
future results or performance expressed or implied by the
Forward-Looking Statements. Management does not have firm
commitments for all of the costs, expenditures, prices or other
financial assumptions used to prepare the financial outlooks or
assurance that such results will be achieved. The actual results of
Jaguar will likely vary from the amounts set forth in the financial
outlooks and such variation may be material. Jaguar and its
management believe that the financial outlooks have been prepared
on a reasonable basis, reflecting the best estimates and judgments,
and represent, to the best of management's knowledge and opinion,
the Company's expected production, grades, tonnes milled, recovery
rates, cash operating costs, and definition/delineation drilling,
in addition to overall expenditures and results of operations
during 2015. However, because this information is highly subjective
and subject to numerous risks, including the risks discussed below,
it should not be relied on as necessarily indicative of future
results. Forward-looking information is based on
current expectations, estimates and projections that involve a
number of risks and uncertainties which could cause actual results
to differ materially from those anticipated by Jaguar and described
in the forward-looking information. The forward-looking information
contained in this press release is made as of the date hereof and
Jaguar undertakes no obligation to update publicly or revise any
forward-looking information, whether as a result of new
information, future events or otherwise, unless required by
applicable securities laws. The forward-looking information
contained in this press release is expressly qualified by this
cautionary statement.
Forward-Looking Statements involve known and unknown risks,
uncertainties and other factors may cause the actual results,
performance or achievements to be materially different from those
expressed or implied by the forward-looking statements. Such risk
factors include, among others the risk of Jaguar's not meeting the
forecast plans regarding its operations and financial performance,
as well as those factors disclosed in the Company's current Annual
Information Form and Management's Discussion and Analysis, as well
as other public disclosure documents, available on SEDAR at
www.sedar.com. Although the Company has attempted to
identify important factors that could cause actual actions, events
or results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate. The forward-looking statements contained
herein are presented for the purposes of assisting investors in
understanding the Company's plan, objectives and goals and may not
be appropriate for other purposes. Accordingly, readers should not
place undue reliance on forward-looking statements.
These Forward-Looking Statements represent the Company's
views as of the date of this press release. The Company anticipates
that subsequent events and developments may cause the Company's
views to change. Factors, which could cause results or events to
differ from current expectations, include, among other things,
actions taken against the Company by governmental agencies and
securities and other regulators and other factors not currently
viewed as material that could cause actual results to differ
materially from those described in the Forward-Looking Statements.
The Company does not undertake to update any Forward-Looking
Statements, either written or oral, that may be made from time to
time by or on behalf of the Company subsequent to the date of this
discussion except as required by law.
Non-IFRS Measures.
This press release
provides certain financial measures that do not have a standardized
meaning prescribed by IFRS. Readers are cautioned to review the
above stated footnotes where the Company expanded on its use of
non-IFRS measures.
Footnotes
- Cash operating costs and cash operating cost per ounce are
Non-IFRS measures. In the gold mining industry, cash operating
costs and cash operating costs per ounce are common performance
measures but do not have any standardized meaning. Cash operating
costs are derived from amounts included in the Consolidated
Statements of Comprehensive Income (Loss) and include mine site
operating costs such as mining, processing and administration as
well as royalty expenses, but exclude depreciation, depletion
share-based payment expenses and reclamation costs. Cash operating
costs per ounce are based on ounces produced and are calculated by
dividing cash operating costs by commercial gold ounces produced;
US$ cash operating costs per ounce produced are derived from the
cash operating costs per ounce produced translated using the
average Brazilian Central Bank R$/US$ exchange rate. The Company
discloses cash operating costs and cash operating costs per ounce
as it believes those measures provide valuable assistance to
investors and analysts in evaluating the Company's operational
performance and ability to generate cash flow. The most directly
comparable measure prepared in accordance with IFRS is total
production costs. A reconciliation of cash operating costs per
ounce to total production costs for the most recent reporting
period, the three months ended March 31, 2015 is set out
in the Company's second quarter 2015 MD&A filed on SEDAR
at www.sedar.com.
- All-in sustaining cost is a non-IFRS measure. This measure is
intended to assist readers in evaluating the total costs of
producing gold from current operations. While there is no
standardized meaning across the industry for this measure, except
for non-cash items the Company's definition conforms to the all-in
sustaining cost definition as set out by the World Gold
Council in its guidance note dated June 27, 2013. The
Company defines all-in sustaining cost as the sum of production
costs, sustaining capital (capital required to maintain current
operations at existing levels), corporate general and
administrative expenses, and in-mine exploration expenses. All-in
sustaining cost excludes growth capital, reclamation cost accretion
related to current operations, interest and other financing costs
and taxes. A reconciliation of all-in sustaining cost to total
production costs for the most recent reporting period, the three
months ended March 31, 2015 is set out in the Company's
second quarter 2015 MD&A filed on SEDAR
at www.sedar.com.
SOURCE Jaguar Mining Inc.