VANCOUVER, April 27, 2018 /CNW/ - Maverix Metals Inc. (the
"Company" or "Maverix") (TSX-V: MMX) is pleased to
announce its record operating and financial results for the fourth
quarter and year ended December 31,
2017.
For complete details please refer to the Financial Statements
and associated Management Discussion and Analysis for the quarter
and year ended December 31, 2017,
available on SEDAR (www.sedar.com) or the Company's website
(www.maverixmetals.com).
All dollar amounts are in Canadian dollars unless otherwise
indicated.
Fourth Quarter 2017 Highlights
- Record quarterly revenue of $7.1
million;
- Record operating cash flow of $5.3
million, excluding changes in non-cash working
capital(1);
- Record attributable gold equivalent ounces sold of 4,361
ounces(1);
- Average cash cost per attributable gold equivalent ounce of
$151 resulting in cash operating
margins of $1,476 per
ounce(1);
- Net income of $1.1 million;
and
- Acquisition from a third party of a pre-existing 2.0% net
smelter return ("NSR") royalty on the Karma gold mine in
Burkina Faso, operated by
Endeavour Mining Corporation.
Full Year 2017 Highlights
- Revenue of $19.5 million;
- Operating cash flow of $14.6
million, excluding changes in non-cash working
capital(1);
- Attributable gold equivalent ounces sold of 11,965
ounces(1);
- Average cash cost per attributable gold equivalent ounce of
$166 resulting in cash operating
margins of $1,466 per
ounce(1);
- Net income of $2.7 million;
- Acquired four paying NSR royalties on mines located in the
USA, Canada, Australia, and Burkina Faso, to end the year with nine paying
royalties and one paying gold stream; and
- Completed a US$25 million
strategic financing with CEF Holdings Limited, a joint venture
between Li Ka-shing and CIBC,
consisting of a US$20 million loan
facility and a concurrent US$5
million private placement.
Dan O'Flaherty, President and CEO
of Maverix, commented, "We are pleased with the Company's
exceptional first full year of operation. Throughout 2017, we
continued to build and strengthen our portfolio by acquiring four
paying NSR royalties, which will meaningfully enhance our cash
generating platform. Additionally, we expect further growth in
attributable gold equivalent ounces and revenues in 2018, as a
number of our royalties are on underlying mines that are currently
expanding production."
Outlook
The Company is forecasting 2018 attributable gold equivalent
production to be between 16,500 and 18,500 ounces based on the
Company's existing royalties and streams, which would represent an
increase of approximately 40% to 50% over 2017 attributable
production. Revenue for 2018 is expected to be between C$26 million to C$30
million with approximately 95% generated from gold and
silver sales.
Royalty and Stream Asset Updates
- Moose River Consolidated: On March 5th, 2018, Atlantic Gold Corp.
("Atlantic Gold") announced that commercial
production had been achieved at the Moose River Consolidated mine
located in Nova Scotia. Atlantic
Gold has provided production guidance of 82,000 to 90,000 ounces of
gold in 2018.(2)
Maverix owns a 3.0% NSR royalty on the Touquoy deposit at the Moose
River Consolidated mine.
- Silvertip: On March
8th, 2018, Coeur Mining, Inc. announced that it
had commenced production ahead of schedule at its Silvertip mine
located in British Columbia. Mill
throughput continues to ramp-up according to plan with commercial
production expected to be achieved by mid-year.(3)
Maverix owns a 2.5% NSR royalty on the Silvertip mine.
- Florida Canyon: On March
19th, 2018, Rye Patch Gold Corp. ("Rye
Patch") announced that it entered into a business combination
with Alio Gold Inc. ("Alio
Gold"). The new company will have an improved balance
sheet with $45 million in pro forma
net cash as at December 31, 2017,
which will support the advancement of Rye Patch assets, including
the Florida Canyon mine located in Nevada. Alio
Gold and Rye Patch have stated that the transaction is
expected to close in late May assuming all conditions to the
transaction are satisfied.(4)
Maverix owns a 3.25% NSR royalty on the Florida Canyon mine.
- Beta Hunt: On March
22nd, 2018, RNC Minerals ("RNC") announced
that it expects a fifth consecutive quarter of increased gold
production in the first quarter of 2018 at its Beta Hunt mine
located in Western
Australia.(5)
Maverix owns a 6.0% gross revenue royalty and a 1.5% NSR royalty on
gold production, plus a total of 1.5% NSR royalties on nickel
production on the Beta Hunt mine.
|
(1)
Maverix has included certain performance measures in this press
release that do not have any standardized meaning prescribed by
International Financial Reporting Standards (IFRS) including
average cash cost per attributable gold equivalent ounce and cash
operating margin. The Company believes that, in addition to
conventional measures prepared in accordance with IFRS, certain
investors use this information to evaluate the Company's
performance and ability to generate cash flow. Average cash cost
per attributable gold equivalent ounce is calculated by dividing
the total cost of sales, less depletion, by the ounces sold. In the
precious metals mining industry, this is a common performance
measure but does not have any standardized meaning. Cash operating
margin is calculated by subtracting the average cash cost per ounce
from the average realized selling price per ounce of gold. The
Company presents cash operating margin as it believes that certain
investors use this information to evaluate the Company's
performance in comparison to other companies in the precious metal
royalty and streaming sector who present results on a similar
basis. The Company's royalty revenue is converted to an
Attributable Gold Equivalent ounce basis by dividing the royalty
revenue for a period by the average gold price based on the LBMA
Gold Price PM Fix per ounce for the same respective period. These
attributable gold equivalent ounces when combined with the gold
ounces sold from the Company's gold streams (individually and
collectively referred to as "Attributable Gold Equivalent") equal
total Attributable Gold Equivalent ounces sold. The Company has
also used the non-IFRS measure of operating cash flows excluding
changes in non-cash working capital. This measure is calculated by
adding back the decrease or subtracting the increase in changes in
non-cash working capital to or from cash provided by (used in)
operating activities. The presentation of this non-IFRS measure is
intended to provide additional information and should not be
considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS. Other companies may
calculate these non-IFRS measures differently. Note these figures
have not been audited and are subject to change.
|
|
(2) For
more information on the Moose River Consolidated mine, please visit
the Atlantic Gold Corp. website at www.atlanticgoldcorporation.com
and refer to the news release dated March 5, 2018.
|
|
(3) For
more information on the Silvertip mine, please visit the Coeur
Mining, Inc. website at www.coeur.com and refer to the news release
dated March 8, 2018.
|
|
(4) For
more information on the Florida Canyon mine, please visit the Rye
Patch website at www.ryepatchgold.com and refer to the news release
dated March 19, 2018.
|
|
(5) For
more information on the Beta Hunt mine, please visit the RNC
Minerals website at www.rncminerals.com and refer to the news
release dated March 22, 2018.
|
Qualified Person
Doug Ward, B.Sc., Mining
Engineering, MMSA, Vice President Technical Services for the
Company, and a "Qualified Person" under NI 43-101 has reviewed and
approved the scientific and technical disclosure contained in this
press release.
About Maverix
Maverix Metals Inc. is a gold royalty and streaming company.
Maverix's mission is to provide its shareholders with significant
low risk leverage to the gold price and to increase underlying per
share value by expanding its portfolio with acquisitions of
high-quality royalties and streams that offer robust returns.
NEITHER THE TSX VENTURE EXCHANGE ("TSX-V") NOR ITS REGULATION
SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE
TSX-V) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS
RELEASE.
Technical and third party information
The disclosure herein and relating to properties and operations
on the properties in which the Company holds royalty, stream or
other interests is based on information publicly disclosed by the
owners or operators of these properties and information/data
available in the public domain as at the date hereof, and none of
this information has been independently verified by the Company.
Specifically, as a royalty or stream holder, the Company has
limited, if any, access to properties included in its asset
portfolio. Additionally, the Company may from time to time receive
operating information from the owners and operators of the
properties, which it is not permitted to disclose to the public.
The Company is dependent on, (i) the operators of the properties
and their qualified persons to provide information to the Company,
or (ii) on publicly available information to prepare disclosure
pertaining to properties and operations on the properties on which
the Company holds royalty, stream or other interests, and generally
has limited or no ability to independently verify such information.
Although the Company does not have any knowledge that such
information may not be accurate, there can be no assurance that
such third party information is complete or accurate. Some
information publicly reported by operators may relate to a larger
property than the area covered by the Company's royalty, stream or
other interest. The Company's royalty, stream or other interests
often cover less than 100% and sometimes only a portion of the
publicly reported mineral reserves, mineral resources and
production of a property.
Cautionary note regarding forward-looking statements
This release contains certain "forward looking statements" and
certain "forward-looking information" as defined under applicable
Canadian and U.S. securities laws. Forward-looking statements and
information can generally be identified by the use of
forward-looking terminology such as "may", "will", "should",
"expect", "intend", "estimate", "anticipate", "believe",
"continue", "plans" or similar terminology. The forward-looking
information contained herein is provided for the purpose of
assisting readers in understanding management's current
expectations and plans relating to the future. Readers are
cautioned that such information may not be appropriate for other
purposes.
Forward-looking statements and information include, but are not
limited to, statements with respect to the Company's financial
guidance, outlook, proposed plans for acquiring additional stream
and royalty interests and the potential of such streams and royalty
interests to provide returns and the completion of mine expansion
under construction phases at the mines or properties that the
Company holds an interest in. Forward-looking statements and
information are based on forecasts of future results, estimates of
amounts not yet determinable and assumptions that, while believed
by management to be reasonable, are inherently subject to
significant business, economic and competitive uncertainties and
contingencies.
Forward-looking information is subject to known and unknown
risks, uncertainties and other factors that may cause the actual
actions, events or results to be materially different from those
expressed or implied by such forward-looking information, including
but not limited to: the impact of general business and economic
conditions; the absence of control over mining operations from
which Maverix will purchase gold and other metals or from which it
will receive royalty payments and risks related to those mining
operations, including risks related to international operations,
government and environmental regulation, delays in mine
construction and operations, actual results of mining and current
exploration activities, conclusions of economic evaluations and
changes in project parameters as plans continue to be refined;
accidents, equipment breakdowns, title matters, labor disputes or
other unanticipated difficulties or interruptions in operations;
problems inherent to the marketability of gold and other metals;
the inherent uncertainty of production and cost estimates and the
potential for unexpected costs and expenses; industry conditions,
including fluctuations in the price of the primary commodities
mined at such operations, fluctuations in foreign exchange rates
and fluctuations in interest rates; government entities
interpreting existing tax legislation or enacting new tax
legislation in a way which adversely affects Maverix; stock market
volatility; regulatory restrictions; liability, competition, loss
of key employees and other related risks and uncertainties.
Maverix undertakes no obligation to update forward-looking
information except as required by applicable law. Such
forward-looking information represents management's best judgment
based on information currently available. No forward-looking
statement can be guaranteed and actual future results may vary
materially. Accordingly, readers are advised not to place undue
reliance on forward-looking statements or information.
SOURCE Maverix Metals Inc.
