AuRico earns $1.35-million (U.S.) in Q1
2012-05-09 17:51 ET - News Release
Shares issued 281,760,919
AUQ Close 2012-05-08 C$ 8.11
Mr. Scott Perry reports
AURICO REPORTS Q1 FINANCIAL RESULTS
AuRico Gold Inc. has released financial results for the first quarter ended March 31, 2012. All amounts are in U.S. dollars unless otherwise indicated.
First Quarter Financial Highlights
- For the first quarter, the Company reported the following results, inclusive of discontinued operations unless otherwise noted:
- Revenues of $177.3 million, a 152% increase over 2011
- Earnings from mining operations1 of $74.9 million, an increase of 151% over 2011, including earnings from mining operations from core North American assets2 of $47.8 million
- Adjusted net earnings3 of $57.8 million, or $0.21 per share
- Cash position of $113 million, prior to anticipated cash proceeds of more than $155 million, equity shares of $110 million, and future contingency payments relating to the divestiture of the Fosterville, Stawell and El Cubo operations
- Operating cash flow of $64.6 million, or $0.23 per share, an 92% increase over 2011
- Operating cash flow of $48.0 million, or $0.17 per share from core North American assets
- Record production of 80,873 gold ounces and 1.1 million silver ounces, or 102,412 gold equivalent ounces using the actual gold equivalency ratio of 51:1, a 105% increase over 2011
- Production from core North American assets of 40,986 gold ounces and 902,943 silver ounces, or 58,470 gold equivalent ounces using the actual gold equivalency ratio of 51:1, a 17% increase over 2011
- Cash costs of $770 per gold equivalent ounce (realized)
- Cash costs of $493 per gold equivalent ounce (realized) at the Company's core North American assets
- Average realized margin of $930 per ounce, or 55%
- Average realized margin of $1,207 per ounce, or 71%, from the core North American assets
"During the first four months of 2012 the Company has continued to deliver on its strategic plan, advancing the Young-Davidson mine to production and streamlining our asset base through the divestiture of non-core assets. Our exclusive focus is now on our portfolio of three large, low-cost, producing operations as well as exploration and development properties located in Canada and Mexico." stated RenAcopyright Marion, Chief Executive Officer. He continued, "On April 30th, Young-Davidson completed its first gold pour. The commissioning process is proceeding better than anticipated with mill throughput currently exceeding targeted levels. We remain on track to declare commercial production in early Q3 with a re-engineered mine plan that is expected to deliver annual production of 250,000 ounces by 2016."
Earnings from mining operations includes earnings from operations as disclosed in the Company's First Quarter MD&A for the Ocampo, El Chanate, El Cubo, Fosterville and Stawell mines, prior to the impairment charge recorded on the Australian operations of $22,857.
Core North American assets include the Ocampo and El Chanate mines.
See the table at the end of this press release for a reconciliation of adjusted net earnings and refer to the Non-GAAP Measures section below.
Young-Davidson Highlights
- Announced first gold pour on April 30.
- Averaged an open pit mining rate of over 27,000 tonnes per day in April
- Averaged more than 5,000 tonnes per day at the Young-Davidson mill facility (from April 19 to 30)
- Established a million tonne stockpile of ore ahead of the mill facility
- On May 4, received the amended environmental compliance approval from the Ontario Ministry of Environment to process up to 8,000 tonnes per day of ore
- Commercial production will be declared once mill throughput averages a minimum of 5,100 tonnes per day over a 30-day period, the open pit averages 29,750 tonnes per day of ore and waste mining over a 30-day period, and the flotation and gravity circuits are commissioned.
Other Highlights
- Announced the sale of El Cubo on April 15, 2012
- Negotiated an expanded $250 million, four-year revolving credit facility
- Completed divestment of the Australian operations on May 4, 2012
- Completed second expansion to 21,000 tpd at the El Chanate crushing and stacking plant
FIRST QUARTER RESULTS Quarter ended Quarter ended March 31, 2012 March 31, 2011 Revenue from mining operations (1) $112,451 $70,313 Average realized gold price per ounce $1,700 $1,386 Average realized silver price per ounce $33.02 $32.30 Earnings from operations(1) $40,836 $23,552 Net earnings from continuing operations $1,319 $11,786 Net earnings from discontinued operations $34 -- Total net earnings $1,353 $11,786 Net earnings per share from continuing operations, basic $0.00 $0.09 Net earnings per share from discontinued operations, basic $0.00 -- Total net earnings per share, basic $0.00 $0.09 Adjusted net earnings (2) $57,815 $20,165 Adjusted net earnings per share $0.21 $0.14 Total operating cash flow $64,579 $33,621 Total net free cash flow ($100,437) $5,933 (1) Operational data, including ounces produced and sold, and cash costs include the results of both continuing and discontinued operations. Certain financial information, including revenues, production costs, earnings from operations are exclusive of discontinued operations as the financial results and balances of these operations are presented separately on the Condensed Consolidated Statements of Operations within the Company's Condensed Consolidated Financial Statements for the three months ended March 31, 2012. (2) A Non-GAAP Measure.
Recent Corporate Announcements
On April 15, 2012, the Company announced that it had entered into a definitive agreement whereby Endeavour Silver Corporation ("Endeavour") will acquire 100% interests in AuRico's El Cubo silver-gold mine in Guanajuato State, Mexico and the Guadalupe y Calvo silver-gold exploration project in Chihuahua State, Mexico, for total consideration of up to US$250 million. On closing, Endeavour will pay AuRico US$200 million, comprised of, at Endeavour's election, up to US$100 million of the purchase price in Endeavour common shares and the balance in cash. Post-closing, AuRico will be entitled to receive up to an additional US$50 million in cash payments from Endeavour upon the occurrence of certain events during the three years following closing.
On April 25, 2012, the Company's revolving credit facility was expanded to $250 million. The expanded credit facility is syndicated with seven lenders, with the Bank of Nova Scotia and Canadian Imperial Bank of Commerce the joint lead arrangers, and carries an interest rate of LIBOR plus 2.25% to 3.50%, depending on the leverage ratio of the Company. The facility matures on April 25, 2016 and may be extended upon mutual agreement by all parties. There are no operational performance covenants associated with the facility, and no payments are due until the maturity date.
On April 30, 2012, the first gold pour was completed at the Young-Davidson mine located in the Abitibi gold belt in Northern Ontario. The commissioning process has gone better than anticipated and the mine remains on track to achieve commercial production in the third quarter. During this initial commissioning process, the Company also announced a 36% increase in reserves and a 33% expansion program to ultimately reach annual production of 250,000 ounces by 2016.
On May 4, 2012, the Company completed the previously announced transaction with Crocodile Gold Corp. ("Crocodile Gold") pursuant to which Crocodile Gold acquired the Company's Stawell and Fosterville mines located in Australia through the acquisition of all of the shares of Northgate Australian Ventures Corporation Pty Ltd.
The interim financial statements and related Management's Discussion and Analysis can be found on the Company's website at www.auricogold.com or under the Company's profile on www.sedar.com and with the Securities and Exchange Commission at sec.gov  ("Edgar").
Q1 Conference Call and Webcast
A webcast and conference call will be held on Thursday, May 10, 2012 starting at 10:00 a.m. Eastern Time. Senior management will be on the call to discuss the results.
Conference Call Access: Canada & US Toll Free: 1-888-231-8191
International & Toronto: 1-647-427-7450
When the Operator answers, please ask to be placed into the AuRico Gold First Quarter 2012 Results Conference Call.
If you are unable to attend the conference call, a replay will be available until midnight, May 17, 2012 by dialing the appropriate number below:
Local Toronto Participants: 1-416-849-0833 Passcode: #73603620 North America Toll Free: 1-855-859-2056 Passcode: #73603620
Archive Webcast:
The webcast will be archived for 90 days by following the link provided below:
newswire.ca or via the Company's website at www.auricogold.com. About AuRico Gold
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