TIDMOMI
Orosur Mining Inc. ("Orosur" or "the Company") (TSX: OMI) (AIM:
OMI), the South American-focused gold producer, developer and
explorer is pleased to announce the results for the fiscal year
ended May 31, 2017 ("FY17").
Highlights
Financial & Operational Results
-- FY17 production of 35,371 oz (within stated guidance of 35-40 koz)
following a significant increase in production in Q4 (10,748
oz).
-- FY17 Operating cash cost guidance of US$829 (confirmed within stated
guidance of US$800 - 900/oz) and representing an improvement on
FY16:
US$877.
-- Average gold price received of US$1,258/oz (FY15: US$1,154/oz).
-- Cash flow generated by operations was US$9.7M (FY16: US$7.6M) due to
better operating performance and gold price in FY17.
-- Profit before tax was US$2.0M (FY16: loss of US$3.2M) due to higher
gold price at $1,258/oz (FY16: $1,154/oz) and lower overall
costs of
sales.
-- Successfully built and developed the San Gregorio West underground
mine in Uruguay ("SGW UG") from internally generated funds
(total
investment in SGW UG during FY17 was US$5.9M).
-- The Company invested US$10.8M in capital and US$2.6M in exploration
(FY16: US$3.9M and US$2.8M, respectively). In addition to
the
construction of the SGW UG mine, the Company invested in the
completion of the construction of phase 4A of the new tailings
dam
during FY17.
-- All-In-Sustaining Costs ("AISC") of US$1,228/oz (FY16: US$1,069/oz).
The increase was due mainly to the additional development
capex
associated with building the SGW UG mine.
-- Cash balance at the end of May 2017 was US$3.4M (Q3 US$2.4M and FY
2016 US$4.3M) with debt of just US$0.4.
Exploration and Corporate
-- Following completion of the equity raise announced on August 11th,
2017, the company is in the process of ramping up drilling in
Colombia
and plans to update the market on recent Exploration progress in
both
Colombia and Uruguay in short order.
Ignacio Salazar, CEO of Orosur, commented:
"We are very pleased to report a successful FY17 having achieved
a number of important corporate milestones whilst simultaneously
delivering in line with production and cost targets for the fourth
consecutive year.
Cost management and technical excellence remain central to our
strategy, demonstrated by successfully building and opening of the
second UG mine in Uruguay during the year.The completion of the
recent financing announced on August 11th 2017, which was
oversubscribed and at a premium to the prevailing market when
negotiated, is an important step to support our growth
strategy.
The quality of our assets, our track record on delivery and the
recent financing position the Company well forFY18 to make
significant progress towards its growth potential and we look
forward to reporting results from the resource definition in
Colombia, tapping the potential of the highly prospective 100km
greenstone belt we control in Uruguay and advancing Anillo in
Chile,"
Operational & Financial Summary1 Fiscal Year (FY)
ended May 31
2017 2016 Change
Operating Results
Gold produced Ounces 35,371 35,773 (402)
Operating Cash cost3 US$/oz 829 877 (48)
Total Cash cost US$/oz 882 891 (9)
AISC US$/oz 1,228 1,069 159
Average price received US$/oz 1,258 1,154 104
Financial Results
Revenue US$ '000 44,226 42,866 1,360
Net income (loss) before tax US$ '000 2,028 (3,158) 5,186
Cash flow from operations2 US$ '000 9,664 7,603 2,061
Cash & Debt at the end of the period 2017 2016 Diff
Cash balance US$ '000 3,357 4,320 (963)
Total Debt US$ '000 403 352 51
Cash net of debt US$ ´000 2,954 3,968 (1,014)
1 Results are based on IFRS and expressed in US dollars2 Before
non-cash working capital movements3 Operating cash cost is total
cost discounting royalties and capital tax on production
assets.
FY18 Outlook & Guidance
The Company expects production from the San Gregorio mine in
Uruguay for FY18 to be between 30,000 - 35,000 ounces of gold, with
operating costs of US$800 - US$900 per ounce.
At current gold prices this will allow the Company to continue
to focus on expanding its resource base in Uruguay both from
underground and surface operations, with the aim of increasing its
mine life and/or increasing production by utilising the spare
capacity in the San Gregorio plant.
As in the past, variations in production and unit costs will
occur quarter on quarter as the mine plan draws ore from several
sources at varying grades and stages of development or stripping.
The Company plans to achieve its production and cost targets over
the course of the year.
The Company is preparing to commence a 15,000m drilling campaign
in its highly prospective Anzá project in the mid-cauca belt of
Colombia. The Company will update the market with drilling results
during the year as the program advances.
FY17 Financial Summary
Cash operating costs for the year were $829/oz (FY16: $877/oz),
a reduction of 6%, due primarily to lower operating costs related
to lower tonnes transported, processed at higher grades during the
year and continuous technical improvements and cost management
efforts. The Company successfully reached its cash operating cost
guidance of US$800 - 900/oz for the year.
All-in-sustaining costs ("AISC") were $1,228/oz (FY16:
$1,069/oz). The increase was due mainly to the additional
development capex associated with the SGW UG mine, including ramp,
access and ventilation work while at the same time in FY17 the
company did not have the benefit of the exemption of the royalty
granted for FY16. AISC peaked at $1,345/oz in Q2 17 and since then,
the Company started to reduce capital investment during the
remainder of FY17.
Cash flow generated by operations before working capital
investment was US$9.7M (FY16: US$7.6M) due to better operating
performance in FY17 as explained above.
Contribution margin FY17 was US$11.1 (FY16: US$6.8M) and Profit
before tax was US$2.0M (FY16: loss of US$3.2M) due to higher gold
price at $1,258/oz (FY16: $1,154/oz) and lower costs of sales
overall. Net profit after tax for the year was US$2.6M (FY16: loss
of US$1.2M).
The Company invested US$10.8M in capital and US$2.6M in
exploration (FY16: US$3.9M and US$2.8M, respectively). In addition
to the construction of the SGW UG mine, the Company invested during
FY17 in completing the construction of the phase 4A of the new
tailings dam.
Cash balance at the end of the year was US$3.4M compared to
US$4.3M at May 31, 2016. The decrease in cash was mainly due to the
development of the SGW UG mine (total investment in SGW UG during
the year 2017 was US$5.9M). The SGW UG mine was financed fully from
cash from operations. Total debt as at May 31, 2017 was US$0.4M
compared to US$0.4M at May 31, 2016. This debt relates to leases on
small vehicles and equipment.
The Company has a US$1.5M committed and undrawn line of credit
with Banco Santander available as at May 31, 2017, and as of the
date hereof.
Exploration Update
Following the equity raise announced on August 11th, 2017, the
company is in the process of ramping up drilling in Colombia and
plans to update the market on recent Exploration progress in both
Colombia and Uruguay in short order.
Forward Looking Statements
All statements, other than statements of historical fact,
contained or incorporated by reference in this news release,
including any information as to the future financial or operating
performance of the Company, constitute "forward-looking statements"
within the meaning of certain securities laws, including the "safe
harbour" provisions of the Securities Act (Ontario) and the United
States Private Securities Litigation Reform Act of 1995 and are
based on expectations estimates and projections as of the date of
this news release. There can be no assurance that such statements
will prove to be accurate. Such statements are subject to
significant risks and uncertainties, and actual results and future
events could differ materially from those anticipated in such
statements. Forward-looking statements include, without limitation
success of exploration activities; permitting time lines; the
failure of plant; equipment or processes to operate as anticipated;
accidents; labour disputes; requirements for additional capital
title disputes or claims and limitations on insurance coverage. The
Company disclaims any intention or obligation to update or revise
any forward looking statements whether as a result of new
information, future events and such forward-looking statements,
except to the extent required by applicable law.
About Orosur Mining Inc.
Orosur Mining Inc. is a fully integrated gold producer,
developer and exploration company focused on identifying and
advancing gold projects in South America. The Company operates the
only producing gold mine in Uruguay (San Gregorio), and has
assembled an exploration portfolio of high quality assets in
Uruguay, Chile and Colombia. The Company is listed in Canada (TSX:
OMI) and London (AIM: OMI).
For more information please visit www.orosur.ca
Orosur Mining IncIgnacio Salazar, +1-778-373-0100Chief Executive
Officerinfo@orosur.caorCantor Fitzgerald Europe - Nomad & Joint
BrokerDavid Porter/Keith Dowsing, +44 (0) 20 7894 7000orNumis
Securities Limited - Joint BrokerJohn Prior / James Black / Paul
Gillam, +44 (0) 20 7260 1000orFTI ConsultingBen Brewerton / Oliver
Winters / Sara Powell / Emerson Clarke, +44 (0) 20 3727 1000
- Financial Statements Follow -
Orosur Mining Inc.Consolidated Statements of Financial Position(Thousands of United States Dollars, except where indicated)
As at May 312017($) As at May 312016($)
Assets
Cash 3,357 4,320
Accounts receivable and other assets 1,519 1,770
Inventories 13,157 12,069
Total current assets 18,033 18,159
Accounts receivable and other assets 550 550
Property plant and equipment and development costs 16,160 10,106
Exploration and evaluation costs 17,677 17,250
Deferred income tax assets 3,115 2,534
Restricted cash 229 221
Total non-current assets 37,731 30,661
Total Assets 55,764 48,820
Liabilities and Shareholders' Equity
Trade payables and other accrued liabilities 14,518 10,586
Current portion of long-term debt 202 253
Environmental rehabilitation provision 243 360
Total current liabilities 14,963 11,199
Long-term debt 201 99
Environmental rehabilitation provision 5,405 5,327
Total non-current liabilities 5,606 5,426
Total liabilities 20,569 16,625
Capital stock 61,162 60,751
Contributed surplus 5,836 5,925
Deficit (30,913) (33,497)
Currency translation reserve (890) (984)
Total shareholders' equity 35,195 32,195
Total liabilities and shareholders' equity 55,764 48,820
Orosur Mining Inc.
Consolidated Statements of Profit/(Loss)
and Comprehensive Profit/(Loss)
(Thousands of United States Dollars except
for earnings per share amounts)
For the years ended May 31 2017 ($) 2016 ($)
Sales 44,226 42,866
Cost of sales (40,271) (42,073)
Gross profit 3,955 793
(2,398)
Corporate and administrative expenses (2150)
Restructuring costs 143 (1,709)
Exploration and evaluation (131) (351)
costs written off
Impairment of assets - (4,229)
Obsolescence provision (113) (39)
Other income 1,527 4,009
Finance cost net (164) 24
Derivative gain/(loss) (458) 158
Foreign exchange gain/(loss) (333) 336
(1,927) (3,951)
Profit/(Loss) before income tax 2,028 (3,158)
Recovery for income taxes 557 1,948
Total Profit/(loss) for the period 2,585 (1,210)
Other comprehensive profit/(loss)
Cumulative translation adjustment 93 (727)
Total comprehensive profit/(loss) 2,678 (1,937)
for the period
Profit/(Loss) per common share
Basic 0.03 (0.01)
Diluted 0.03 (0.01)
Orosur Mining Inc.
Consolidated Statements of Cash Flows
(Thousands of United States Dollars,
except where indicated)
For the years ended May 31 2017 ($) 2016 ($)
Net inflow (outflow) of cash related
to the followingactivities
Cash flow from operating activities
Net profit/(loss) for the year 2,585 (1,210)
Adjustments to reconcile net income to net
cash providedfrom operating activities:
Depreciation 7,143 5,975
Impairment of assets - 4,229
Exploration and evaluation expenses written off 131 351
Obsolescence provision 113 39
Fair value of derivatives 458 (92)
Accretion of asset retirement obligation 18 (210)
Deferred income tax assets (581) (1,983)
Stock based compensation 93 43
Loss/(gain) on sale of property, (241) 116
plant and equipment
Other (55) 345
Subtotal 9,664 7,603
Changes in working capital
Accounts receivable and other assets (211) (38)
Inventories (1,200) 2,253
Trade payables and other accrued liabilities 3,932 (3,255)
Net cash generated from operating activities 12,185 6,563
Cash flow from investing activities
Purchase of property, plant and equipment (10,621) (3,701)
anddevelopment costs
Payments for environmental rehabilitation (213) (241)
Proceeds from the sale of fixed assets 240 123
Exploration and evaluation expenditure assets (2,604) (2,793)
Net cash used in investing activities (13,198) (6,612)
Cash flow from financing activities
Proceeds on sale of common shares of Anillo SPA - 710
Loan proceeds 320 -
Loan payments (270) (1,128)
Net cash generated from/(used 50 (418)
in) financing activities
Decrease in cash (963) (467)
Cash at the beginning of year 4,320 4,787
Cash at the end of year 3,357 4,320
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(END) Dow Jones Newswires
August 29, 2017 02:00 ET (06:00 GMT)
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