Orosur Mining Inc. Announces Third Quarter Results of Financial Year 2013
11.04.2013 | Business Wire
Orosur Mining Inc ("OMI′ or the "Company′) (TSX: Operating and Financial Summary 28th February 9 Months Ended 1Results are based on IFRS and expressed in US 2Operating cash cost is total cost excluding 3Before non-cash working capital movements Financial Performance Production and Costs Exploration Chile Exploration Uruguay Brownfield Hole from to interval Hole from to interval from to interval Exploration Uruguay Greenfield ENDS Qualified Person's Statement About Orosur Mining Inc. Forward Looking Statements Orosur Mining Inc. 2013 ($) Note Ref. Three months ended February 28, Nine months ended February 28, 6,995 Three months Nine months Net inflow (outflow) of cash related to the following Cash flow from Operating activities (16,357) Increase (Decrease) in cash and cash equivalents 1,411 (6,305) February 28, February 28, 2013 ($) 2013 ($) Capital stock Contributed surplus Retained earnings
OMI) (AIM: OMI), the South American focused gold producer and explorer,
today announces its results for the third quarter ending 28February
2013.
Further to the announcement of 8 March, the Company reiterates that
production for the quarter was 18,401 ounces (making 47,822 ounces for
the three quarters ended 28February 2013) and Orosur remains
on track to achieve its forecast production target of 63,000 to 68,000
ounces for the full year. The Arenal Deeps ramp has been completed, with
ore production targeted for April when development for the initial
mining levels is complete.
On April, 9 the Company issued a progress report on its exploration at
the Anillo and Pantanillo projects in Chile.
Key Results Summary
?
3 months ended
?
28th
February
?
2013
?
2012
?
2013
?
2012 Operating Results
?
?
?
?
?
?
?
?
?
?
Gold produced
?
Ounces
?
18,401
?
13,668
?
47,822
?
38,072
Cash cost2
?
$US/oz
?
999
?
1,104
?
1,093
?
1,020
Average price received
?
$US/oz
?
1,653
?
1,691
?
1,646
?
1,674
?
?
?
?
?
?
?
?
?
?
?
Financial Results
?
?
?
?
?
?
?
?
?
?
Revenue
?
$US "000s
?
30,033
?
26,013
?
80,535
?
68,024
Net income for the period after tax
?
$US "000s
?
3,494
?
4,954
?
6,995
?
11,931
Cash flow from operations3
?
$US "000s
?
8,029
?
6,808
?
16,552
?
17,031
Cash at the end of the period
?
$US "000s
?
5,156
?
15,381
?
5,156
?
15,381
Total debt at the end of the period
?
$US "000s
?
9,437
?
6,376
?
9,437
?
6,376
?
?
?
?
dollars
royalties and capital tax on production assets
Ignacio Salazar, Interim Managing Director, commented:
'In this quarter, the Company has completed the ramp at Arenal Deeps,
production and costs have been brought in line with expectations, we
have identified high priority drill targets at Anillo to start drilling
in May and have been re-evaluating Quebrada Pantanillo as a high
sulfidation gold system to improve the economics of the project. All of
this is in line with our strategy to optimise returns to shareholders?.
Cash flow from operations for the quarter was US$ 8.0 million and $US
16.6 million for the year to date, compared to US$ 6.8 million and $US
17.0 million for the corresponding quarter and year to date of the
prior financial year
The Company′s cash balance at 28th February 2013 of US$ 5.2
million compared to $US 3.8 million at 30th November 2012 and $US 11.4
million at 31 May 2012. This is in line with expectations. The Company
has US$ 6.5 million of committed but unutilized lines of credit
available and it is not planning to use them within the current plans
of developments and gold price assumptions.
Production for the quarter increased by 34.6 per cent year on year to
18,401 ounces (Q3 2012: 13,668 ounces). 47,822 ounces were produced
during the three quarters (3Qs 2012: 38,071 ounces), an increase of
25.6 per cent.
Cash operating costs for the quarter were $US 999 per ounce compared
to $US 1,104 during the corresponding quarter of the prior year. Year
to date, costs are $ 1,093 per ounce compared to $ 1,020 in the prior
year.
Production and cash costs have been improving and are in line with
expectations this quarter despite having encountered some operational
issues in the open pits which are not yet completely resolved:
The grade of ore mined from the Crucera pit during the quarter
improved due to a more appropriate mining approach and improved
ore control practices. The reconciliation of ounces produced from
open pits compared to reserve models showed both positive and
negative variances to plan during the quarter. To reduce this
variability an experienced geologist has been recruited to fill
the vacant mine geology superintendent position. Increased focus
is being put on in-pit mapping, geological modeling and additional
infill drilling where necessary in order to improve
reconciliations and provide increased certainty on reserves.
Lower than planned availability of the large open pit fleet was
experienced during the quarter. A number of initiatives have been
taken to improve performance. The maintenance department has been
restructured and commencement of the San Gregorio open pit
expansion project delayed to allow time for major component
changes to be completed. These initiatives have already started to
show improvements. The Company also plans to purchase a new
excavator for the large fleet in the first quarter of 2013/14 to
improve productivity.
Development of the ramp at Arenal Deeps was completed during the
quarter, with ore production targeted for April when level development
for the initial mining levels is complete.
The production forecast for the full year remains on track to be in
the range of 63,000 to 68,000 ounces. A stronger production from
Arenal in the final quarter as development will transition from waste
to ore and higher grade Arenal ore is the key to reach this target.
Anillo ? successful completion of CSAMT (Controlled Source
Audio-frequency Magneto Telluric) survey, to pinpoint the location of
sub-vertical silica-bearing structures which may host economic
gold-silver mineralization. The Company will commence drill testing
the highest priority targets in May, 2013.
Pantanillo - new geological mapping and sampling has confirmed the
evidence of a high sulfidation gold system under a steam heated zone
at Quebrada Pantanillo. Additional activities over the last 6 months
have been focused on the evaluation of new, potentially higher grade,
exploration targets that lie outside of the existing mineral resource.
This potential high sulfidation gold system is located approximately 4
kilometres East-Southeast of Pantanillo Norte where the Company has
defined a maiden National Instrument 43-101 measured and indicated
mineral resource of 47 million tonnes at 0.69 grams of gold per tonne
for 1.05 Million ounces of gold. The Company is currently evaluating
the next summer campaign including geophysics and drilling at the new
areas is expected to start in November 2013.
During the first half of 2012/13, 44 drill holes equal to 4,530 meters
were completed at the Mahoma project (approximately 400 kilometres from
the San Gregorio mine). This included 1,560 metres of diamond drilling
and 2,970 metres of reverse circulation drilling (of which 1,830 meters
were for pre-collars). Assay results received for the final 9 holes
during the quarter are shown in the table below.
An NI-43-101 compliant resource is planned to be announced over the next
two months with the final report expected to be lodged subsequently.
Following the completion of this resource estimate, the Company
anticipates the commencement of a mining feasibility study which assumes
ore being trucked to the San Gregorio operation for processing.
The table below shows only the holes which had mineralized intercepts.
Number
?
meters
?
meters
?
meters
?
Au g/t
MHDD047
?
54.6
?
57.6
?
3.0
?
2.9
MHDD050
?
23
?
25
?
2.0
?
2.16
MHDD050
?
99.5
?
100
?
0.5
?
11.1
MHDD051
?
60.2
?
61.75
?
1.55
?
2.38
MHDD052
?
85.5
?
86
?
0.5
?
26.0
MHDD053
?
40
?
41
?
1.0
?
10.70
MHDD053
?
45
?
48
?
3
?
4.44
MHDD057
?
79
?
81.8
?
2.8
?
2.63
* intercepts consider a cut-off grade of 2.0 g/t and may include up-to 2
meters of below the cut-off grade
At Sobresaliente (6 kilometers from the mine), 14 holes for 1,444 meters
of drilling were completed during the quarter with the objective of
expanding resources and reserves. Drilling confirmed the existence of
good grades and widths beneath the currently planned pit at
Sobresaliente north. Drilling intercepts are reported in the following
table.
The table below shows only the holes which had mineralized intercepts.
Number
?
meters
?
meters
?
meters
?
Au g/t
SSRC107
?
49
?
60
?
11
?
1.13
SSRC109
?
11
?
13
?
2
?
1.71
SSRC109
?
72
?
88
?
16
?
2.58
SSRC110
?
71
?
96
?
25
?
1.69
SSRC111
?
58
?
74
?
16
?
4.26
* intercepts consider a cut-off grade of 0.4 g/t and may include up-to 2
meters of below the cut-off grade
At Argentinita (29 kilometers from the mine), 11 holes for 2,087 meters
were drilled during the quarter to investigate the potential to expand
underground resources. The partial (not all intercepts tested) results
of 7 out of the 11 holes below show the potential for extensions to
mineralization, and follow-up drilling will be required to define
resources in these zones.
The table below shows only the holes which had mineralized intercepts.
Hole Number
?
meters
?
meters
?
meters
?
Au g/t
ARGRC13-426
?
168
?
178
?
10
?
2.38
ARGRC13-428
?
104
?
105
?
1.0
?
3.15
ARGRC13-428
?
113
?
115
?
3.0
?
2.34
ARGRC13-430
?
107
?
110
?
3.0
?
2.55
ARGRC13-431
?
119
?
121
?
3.0
?
2.53
ARGRC13-433
?
128
?
131
?
3.0
?
1.44
ARGRC13-434
?
142
?
145
?
3.0
?
2.42
* intercepts consider a cut-off grade of 1.0 g/t and may include up-to 2
meters of below the cut-off grade
Nine projects are currently under review as part of the Company ?s
greenfield exploration program in Uruguay. Geological mapping, sampling
and shallow RAB drilling was carried out in areas with gold
mineralization in quartz veins within granitic rock and shear zones in
basement rocks, 732 rock and soil samples were sent to the lab and
evaluation of these projects is ongoing.
The information presented in this press release has been reviewed by
Walter Muehlebach, GM Exploration of OMI and is considered to be in
compliance with NI 43-101 reporting guidelines. Mr Muehlebach is a
graduate in Geology of the Universidad Católica del Norte (Chile) and a
member of the Chilean Comisión Calificadora de Competencias en Recursos
y Reservas Mineras, and has 23 years of experience in the field of
mineral exploration.
Orosur Mining Inc. is a fully integrated gold producer and exploration
company focused on identifying and developing gold projects in Latin
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 and Chile. The Company is quoted in Canada (OMI.TO)
and London (OMI).
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.
?
?
Condensed Interim Consolidated Statement of Financial Position
Thousands of United States Dollars, except where indicated
?
?
?
?
?
Note Ref.
?
As at February 28,
?
As at May 31,
2012 ($)
?
Assets
?
Cash and cash equivalents
5,156
11,461
Accounts receivables and other assets
3 4,014
4,734
Inventories
4 17,562
?
17,110
Total current assets 26,732
33,305
?
Property plant and equipment and development costs
5 62,626
58,737
Exploration and evaluation costs
6 33,284
26,872
Deferred income tax assets
11 5,706
3,642
Restricted cash
351
?
231
Total non-current assets 101,967
89,482
?
?
?
Total Assets 128,699
?
122,787
?
?
?
?
?
?
?
?
?
Liabilities and Shareholders′ Equity
?
Trade payables and other accrued liabilities
3 14,650
18,868
Financial debt
16 2,936
3,418
Derivative financial instruments
13 0
?
41
Total current liabilities 17,586
22,327
?
Financial debt
6,501
2,805
Environmental rehabilitation provisions
7 4,924
?
5,091
Total non-current liabilities 11,425
7,896
?
?
?
Total liabilities 29,011
?
30,223
?
Capital stock
8 55,153
55,074
Warrants
276
276
Contributed surplus
5,474
5,424
Retained earnings
38,785
?
31,790
Total shareholders′ equity 99,688
?
92,564
?
Total liabilities and shareholders′ equity 128,699
?
122,787
?
?
?
?
?
?
?
?
Approved on behalf of the Board of Directors
'David Fowler?
?
?
Director
?
?
?
?
?
'Ignacio Salazar?
?
?
Managing Director and Chief Financial Officer
?
Orosur Mining Inc. Condensed Interim Consolidated Statements of Income and
Comprehensive income
Thousands of United States Dollars, except for earnings per share
amounts
?
?
?
?
?
?
?
2013 ($)
?
2012 ($)
?
2013 ($)
?
2012 ($)
?
?
Sales
30,033
26,013
80,535
68,024
Cost of sales
18 (24,809)
?
(19,619)
?
(68,612)
?
(50,210)
Gross profit 5,224
6,394
11,923
17,814
?
Corporate and administrative expense
(925)
(1,233)
(3,525)
(3,762)
Exploration expenses
(180)
(947)
(596)
(1,669)
Other income
7
0
398
631
Finance cost
17 (146)
(71)
(393)
(161)
Finance income
17 (2)
(28)
5
(11)
Derivative gain
13 0
0
41
0
Net foreign exchange (loss) gain
(125)
?
124
?
(463)
?
262
Profit before income tax 3,853
4,239
7,390
13,104
?
Recovery (provision) for income taxes
11 (359)
?
715
?
(395)
?
(1,173)
Total income and comprehensive income for the period 3,494
?
4,954
?
?
11,931
?
?
Earnings per common share Basic 15 0.05
0.06
0.09
0.15
Diluted 15 0.05
0.06
0.09
0.15
?
?
?
?
?
?
?
?
?
?
?
?
?
Orosur Mining Inc. Condensed Interim Consolidated Statements of Cash Flows
Thousands of United States Dollars, except where indicated
?
?
?
ended February 28,
ended February 28,
?
2013 ($)
?
2012 ($)
?
2013 ($)
?
2012 ($)
?
?
activities
?
Net income for the period 3,494
4,954
6,995
11,931
Adjustments to reconcile net income to net cash provided from
operating activities:Depreciation 5,123
2,128
12,186
6,118
Fair value of derivatives 0
0
(41)
0
Accretion of asset retirement obligation 19
13
57
39
Deferred income tax assets (481)
(393)
(2,064)
(770)
Stock based compensation 0
41
59
257
Gain on sale of property, plant and equipment (3)
0
(517)
(562)
Others (123)
?
65
?
(123)
?
18
Subtotal 8,029
6,808
16,552
17,031
Changes in operating assets and liabilities Accounts receivables and other assets 809
(817)
(180)
(513)
Inventories 809
1,479
(452)
1,333
Trade payables and other accrued liabilities (1,640)
?
2,507
?
(4,218)
?
5,577
Net cash generated from operating activities 8,007
?
9,977
?
11,702
?
23,428
?
Cash flow from financing activities Proceeds from the issue of share options 0
0
70
20
Proceeds from the issue of shares in a private placement 0
0
0
12,360
Loans received 4,620
556
8,193
5,636
Loans payment (4,672)
?
(15)
?
(4,693)
?
(42)
Net cash from financing activities (52)
?
541
?
3,570
?
17,974
?
Cash flow from investing activities Purchase of property, plant and equipment and development costs (4,605)
(8,574)
(28,117)
Loans collected (granted) 0
100
900
(900)
Proceeds from the sale of fixed assets 17
0
959
1,366
Exploration and evaluation expenditure assets (1,956)
?
(3,717)
?
(7,079)
?
(12,548)
Net cash used in investing activities (6,544)
?
(12,191)
?
(21,577)
?
(40,199)
?
(1,673)
1,203
?
Cash and cash equivalents at the beginning of period 3,745
?
17,054
?
11,461
?
14,178
?
Cash and cash equivalents at the end of period 5,156
?
15,381
?
5,156
?
15,381
?
?
?
?
?
?
?
?
?
?
?
Orosur Mining Inc. Condensed Interim Consolidated Statements of Changes in
Shareholders′ Equity
Thousands of United States Dollars, except where indicated
?
?
Three months ended Nine months ended
?
?
?
2012 ($)
?
?
2012 ($)
?
?
?
Balance at beginning of period
55,153
55,048
55,074
42,692
Private placement net of share issuance costs
0
0
0
12,085
Finder′s fee for Talca acquisition
0
0
0
250
Exercise of stock options
0
0
70
21
Transfer from contributed surplus
0
?
0
?
9
?
0
Balance at end of period
55,153
?
55,048
?
55,153
?
55,048
?
Broker Warrants
Balance at beginning of period
276
276
276
0
Commission on private placement
0
?
0
?
0
?
276
Balance at end of period
276
?
276
?
276
?
276
?
Balance at beginning of period
5,474
5,352
5,424
5,138
Transfer to capital stock
0
0
(9)
(2)
Employee stock based compensation recognized
0
?
41
?
59
?
257
Balance at end of period
5,474
?
5,393
?
5,474
?
5,393
?
Balance at beginning of period
35,291
37,570
31,790
30,593
Net income for the period
3,494
?
4,954
?
6,995
?
11,931
Balance at end of period
38,785
?
42,524
?
38,785
?
42,524
?
Shareholders′ equity at end of period
99,688
?
103,241
?
99,688
?
103,241
?
?
?
?
?
?
?
?
?
?
For further information, please contact:
Orosur Mining Inc
Ignacio
Salazar, Interim Managing Director, + 562 9246800
ignacio.salazar@orosur.ca
Tony
Shearer, Chairman
tony@tonyshearer.com
or
Canaccord
Genuity Limited (Nominated Adviser & Broker)
Andrew
Chubb/Ross Allister, +44 (0) 20 7523 8000