SAS reports solid 2014 second quarter results and raises production guidance
All dollar amounts are stated in Canadian dollars, unless otherwise indicated
TORONTO, Aug. 13, 2014 /CNW/ - St Andrew Goldfields Ltd. (T-SAS) (OTCQX-STADF), ("SAS" or the "Company") reports net income attributable to shareholders for Q2 2014 of $0.6 million, or nil on a per share basis, compared to a net loss of $1.1 million, or nil per share, for Q2 2013. For Q2 2014, adjusted net loss (1) was $0.2 million, or nil, on a per share basis, compared to adjusted net loss of $0.9 million, or nil per share, for Q2 2013.
Q2 2014 production of 22,505 ounces of gold was in line with the Company's expectation. All-in sustaining cost per ounce of gold sold (1) was US$1,098 per ounce during the quarter. Operations continued to perform well with a total cash cost per ounce of gold sold (1) in the quarter of US$872 per ounce (including royalty costs of US$111 per ounce). Mine cash costs of US$761 per ounce of gold sold have improved by 2% or US$19 per ounce over Q2 2013, and was below guidance of US$800 - US$850 per ounce.
SAS generated operating cash flow of $5.5 million, or $0.01 per share, and net cash outflow (1) of $2.6 million for Q2 2014, as compared to operating cash flow of $7.0 million or $0.02 per share and net cash outflow (1) of $0.3 million in Q2 2013. Operating cash flow continued to be negatively impacted by the lower gold price realized in the quarter. There was an increase in net cash outflow (1) by $2.3 million, mainly due to the capital investment at Taylor.
"We had a strong quarter despite the low gold price," said Duncan Middlemiss, President & CEO of SAS. "We kept pressure on our costs, and were able to realize another consecutive quarter of positive operating cash flow. With the extension of mine life at Holloway, due to the continued positive drilling results at Smoke Deep, we are raising the 2014 production guidance to between 85,000 - 95,000 ounces of gold. We remain on schedule with the advancement of Taylor, and look forward to providing updates on this project as well as our exciting exploration targets throughout the year."
Q2 2014 Highlights
| Produced 22,505 ounces of gold from three operations (Holt, Holloway and Hislop). |
YTD 2014 production of 46,866 ounces. Production guidance has been raised to 85,000 - 95,000 ounces of gold. |
| Sold 22,850 ounces of gold at an average realized price of US$1,285 per ounce of gold sold (1) for revenues of $31.7 million. |
Gold sales revenue (2) decreased by $5.1 million when compared to Q2 2013 due to a 10% decline in gold price realized during the quarter, in conjunction with a 9% decrease in sales volume. |
| Mine cash costs of US$761 per ounce and a royalty cost of US$111 per ounce, for a total cash cost per ounce of gold sold (1) of US$872 per ounce. |
A decrease of US$25 per ounce over Q2 2013. Mine cash costs were better than the Company's guidance of US$800-US$850 per ounce. |
| All-in sustaining costs (1) of US$1,098 per ounce of gold sold. |
A decrease of US$100 per ounce when compared to Q2 2013. |
| Earned cash margin from mine operations (1) of $9.9 million and operating cash flow of $5.5 million or $0.01 per share (1). |
Net cash out flow (1) of $2.6 million during the quarter resulted from the lower cash margin from mine operations (1) and the continued investment in Taylor. SAS achieved a ninth consecutive quarter of positive cash flow from operations. |
| Spent $3.8 million at Taylor as part of the Advanced Exploration Program. |
Ramp development remains on schedule and the Company expects to reach the area planned for the second bulk sample in Q4 2014. Results of definition drilling to-date have been positive. |
| Extended US$10.0 million revolving credit facility. |
SAS retired the outstanding US$7.0 million term credit in full during the quarter. The two year extension of the US$10.0 million revolving credit provides the Company with greater liquidity. |
Q2 2014 Conference Call Information
The Company invites you to participate in the upcoming conference call to discuss its second quarter financial and operating results for 2014. The conference call will take place on Thursday August 14, 2014 at 10:00am EST.
Participants may join the call via webcast at www.sasgoldmines.com. A playback of the conference call will be available via the website and will be posted within 24 hours of the call. For more information regarding the annual meeting and the conference call please visit the SAS website.
Operating and Financial Summary
| Amounts in thousands of Canadian dollars, except per share and per unit amounts | Q2 2014 | Q2 2013 | YTD 2014 | YTD 2013 | ||||||||||||||
| SAS Operating Results | ||||||||||||||||||
| Gold production (ounces) | ||||||||||||||||||
| Holt Mine | 15,140 | 13,706 | 32,637 | 28,512 | ||||||||||||||
| Holloway Mine | 4,893 | 5,874 | 10,047 | 11,014 | ||||||||||||||
| Hislop Mine | 2,472 | 5,773 | 4,182 | 10,288 | ||||||||||||||
| 22,505 | 25,353 | 46,866 | 49,814 | |||||||||||||||
| Commercial gold production sold (ounces) | ||||||||||||||||||
| Holt Mine | 15,534 | 14,230 | 32,050 | 27,945 | ||||||||||||||
| Holloway Mine | 5,157 | 5,175 | 10,332 | 10,301 | ||||||||||||||
| Hislop Mine | 2,159 | 5,655 | 3,968 | 9,823 | ||||||||||||||
| 22,850 | 25,060 | 46,350 | 48,069 | |||||||||||||||
| Per ounce data (US$) | ||||||||||||||||||
| Average realized price (1) | $ | 1,285 | $ | 1,428 | $ | 1,289 | $ | 1,526 | ||||||||||
| Mine cash costs | $ | 761 | $ | 780 | $ | 750 | $ | 786 | ||||||||||
| Royalty costs | 111 | 117 | 114 | 131 | ||||||||||||||
| Total cash cost (1) | $ | 872 | $ | 897 | $ | 864 | $ | 917 | ||||||||||
| Cash margin (1) | $ | 413 | $ | 531 | $ | 425 | $ | 609 | ||||||||||
| All-in sustaining cost (1) | $ | 1,098 | $ | 1,198 | $ | 1,094 | $ | 1,237 | ||||||||||
| SAS Financial Results | ||||||||||||||||||
| Gold sales and total revenue (2) | $ | 31,665 | $ | 36,723 | $ | 65,146 | $ | 74,913 | ||||||||||
| Cash margin from mine operations (1) | $ | 9,948 | $ | 13,715 | $ | 21,223 | $ | 30,124 | ||||||||||
| Net income (loss) | $ | 553 | $ | (1,093) | $ | (1,253) | $ | (54) | ||||||||||
| Adjusted net earnings (loss) (1) | $ | (186) | $ | (874) | $ | (2,049) | $ | 196 | ||||||||||
| Operating cash flow | $ | 5,461 | $ | 6,968 | $ | 14,929 | $ | 20,748 | ||||||||||
| Net cash flow (1) | $ | (2,647) | $ | (347) | $ | (1,166) | $ | 3,444 | ||||||||||
| Per share information: | ||||||||||||||||||
| Basic and diluted income (loss) | $ | 0.00 | $ | 0.00 | $ | 0.00 | $ | 0.00 | ||||||||||
| Adjusted net earnings (loss) (1) | $ | 0.00 | $ | 0.00 | $ | 0.00 | $ | 0.00 | ||||||||||
| Operating cash flow (1) | $ | 0.01 | $ | 0.02 | $ | 0.04 | $ | 0.06 | ||||||||||
| SAS Financial Position | June 30, 2014 | December 31, 2013 |
||||||||||||||||
| Cash and cash equivalents | $ | 20,063 | $ | 33,690 | ||||||||||||||
| Working capital | $ | 12,345 | $ | 13,846 | ||||||||||||||
| Total assets | $ | 199,385 | $ | 211,070 | ||||||||||||||
| Total non-current financial liabilities | $ | 2,409 | $ | 3,295 | ||||||||||||||
| (2) | Excluded from gold sales and total revenue for Q2 2014 and YTD 2014 was revenue from tolling milling of $0.3 million earned in Q2 2014. |
Financial Performance
Revenues in Q2 2014, declined when compared to Q2 2013, as a result of a US$143 per ounce decrease in the average realized price per ounce of gold sold (1) and a 9% decrease in sales volume. The decline in revenue was offset partially by a $1.3 million decrease in mine site operating costs and production royalty and led to a $3.8 million decrease in cash margin from mine operations (1). Total cash cost per ounce of gold sold (1) in Q2 2014 of US$872 per ounce, declined by US$25 per ounce from Q2 2013 primarily due to the strengthening of the US dollar relative to the Canadian dollar.
For Q2 2014, SAS achieved net earnings of $0.6 million as compared to a net loss of $1.1 million in Q2 2013. The primary factor was a $2.9 million decrease in non-cash depreciation and depletion expense and a mark-to-market gain on foreign currency derivatives of $1.1 million.
Holt Mine, Operations and Financial Review (see "Operating and Financial Statistics" on page 14)
During Q2 2014, the Holt Mine ("Holt") produced 15,140 ounces of gold, an increase of 9% over Q2 2013, attributable to a 12% increase in throughput, offset by a slight decline in ore grade.
Total cash costs in the quarter decreased by 2% or US$17 per ounce of gold sold from Q2 2103 due to a lower royalty cost and a stronger US dollar relative to the Canadian dollar. Mine site costs in Q2 2014 increased by $11 per tonne of ore milled from Q2 2013, substantially due to increased cemented backfill required for 2014, as secondary stopes are being mined.
In Q2 2014, Holt contributed 85% of the total cash margin from mine operations (1).
Holt is expected to contribute approximately 70% of the Company's total gold production for 2014.
Holloway Mine, Operations and Financial Review (see "Operating and Financial Statistics" on page 15)
The Holloway Mine ("Holloway") produced 4,893 ounces of gold for Q2 2014, 17% lower than Q2 2013 production, due to the depletion of reserves. The head grade averaged 4.09 g/t Au, which was lower than the head grade of 4.32 g/t Au achieved in Q2 2013, while mill recoveries during the quarter were in line with expectations at approximately 91%.
Total cash cost per ounce of gold sold (1) during the quarter decreased marginally when compared to Q2 2013, which was due to increasing unit costs due to the decrease in ore feed, offset by the strengthening of the US dollar relative to the Canadian dollar.
Drilling at the Smoke Deep Zone extended the zone along strike to the east by approximately 200 metres. Drilling continues to test for the extension of the zone to the east and west.
Based on the positive drill results received to date, production at Holloway is now expected to continue into Q4 2014, which represents an increase of approximately 88%. Holloway is expected to contribute 25% of the Company's total gold production for 2014.
Hislop Mine, Operations and Financial Review (see "Operating and Financial Statistics" on page 16)
The Hislop Mine ("Hislop") produced 2,472 ounces of gold during Q2 2014, with an average head grade of 2.14 g/t Au. Mill recoveries of approximately 75% were lower than expected due to the processing of a significant amount of ore containing a fine gold size fraction.
Operations ceased at the beginning of the quarter as the reserves in the West Pit were depleted.
Hislop is expected to contribute approximately 5% of the Company's total gold production for 2014.
Taylor Project Update ("Taylor")
Underground exploration activities continued during the quarter however, ramp development was temporarily affected by excess water during the spring melt which was due to the harsh winter. A total of 277 metres of lateral development and 127 metres of vertical development were completed during Q2 2014. The program remains on schedule to reach the area of the second bulk sample in Q4 2014.
Drilling during Q2 2014 continued to intersect good grade and widths as in hole T220-034 which intercepted 8.88 g/t Au over 29.2 metres (6.11 g/t Au cut), hole T220-046 which intercepted 16.62 g/t Au over 19.4 metres (11.95 g/t Au cut), including 24.93 g/t Au over 12.6 metres (17.73 g/t Au cut), and hole T220-049 which intercepted 26.21 g/t Au over 10.3 metres (9.63 g/t Au cut) (see press releases dated March 3 and May 6, 2014, available under the Company's profile on www.sedar.com or on the Company's website at www.sasgoldmines.com).
Drilling continues to demonstrate the potential to expand mineralization on the 1004 resource block at depth, and additional drilling will follow-up on these results. Ramp development and access will continue throughout Q3 2014.
Exploration Projects
Exploration activities during Q2 2014 continued to follow up on targets identified during the 2013 exploration program. At Hislop, surface drilling identified extensions of the V2 trend to the east and at Hislop North tested the southerly strike extension of the 147 zone from the Primero property onto SAS ground. On June 10, 2014 SAS announced drill results which effectively traced the 147 zone approximately 130 metres onto SAS property.
During Q2 2014, a total of 8,013 metres of surface core drilling and 10,396 metres of underground exploration drilling were completed. Year to date drilling consisted of 13,177 metres of surface core drilling and 17,256 metres of underground exploration drilling on the Company's targets. The 2014 field season commenced with geochemical sampling, trenching and mapping exercises on the Company owned mineral claims situated in Cook, Guibord, Harker, Thackeray and Barnet townships.
Capital Resources
Working capital as at June 30, 2014, was $12.3 million as compared to $13.8 million as at December 31, 2013. At the end of Q2 2014, the Company had cash and cash equivalents of $20.1 million and access to additional cash by way of an undrawn US$10.0 million revolving credit facility ('Facility").
SAS expects to incur approximately $33 million in capital expenditures at the two underground mines, the Holt Mill and Taylor during 2014, of which $16.6 million was spent in the first half of 2014. These investments will be financed by the Company's capital resources and anticipated operating cash flows.
Credit Facilities
The Company retired the term credit facility on May 8, 2014, when it matured. The Company extended the US$10.0 million revolving credit facility ("Facility"), which remains undrawn, for an additional two years. The extension of this Facility provides SAS with improved liquidity.
Qualified Person
Mine development and production at the Holt, Holloway and Hislop mines, processing at the Holt Mill, and mine development activities at Taylor are being conducted under the supervision of Marc-Andre Pelletier, P.Eng, the Company's General Manager of Mine Operations.
Exploration activities on the Company's various mineral properties, including the drilling program at Taylor is under the supervision of Mr. Doug Cater P. Geo, the Company's Vice-President of Exploration.
Messrs. Pelletier and Cater are qualified persons as defined by NI 43-101, and have reviewed and approved this news release.
About SAS
SAS (operating as "SAS Goldmines"), is a gold mining and exploration company with an extensive land package in the Timmins mining district, northeastern Ontario, which lies within the Abitibi greenstone belt, the most important host of historical gold production in Canada.
SAS owns and operates the Holt, Holloway and Hislop mines and produced approximately 100,000 ounces of gold in 2013. The Company is also advancing the Taylor Project and is conducting aggressive exploration across 120km of land straddling the Porcupine-Destor Fault Zone.
Non-GAAP Measures
The Company has included the following non‐GAAP performance measures: adjusted net earnings (loss); total cash cost per ounce of gold sold; all-in sustaining cost per ounce of gold sold; mine site cost per tonne milled; cash margin from mine operations; average realized price per ounce of gold sold; cash margin per ounce of gold sold; net cash flow; and operating cash flow per share; throughout this news release, which do not have standardized meanings prescribed by International Financial Reporting Standards ("IFRS") and are not necessarily comparable to other similarly titled measures of other companies due to potential inconsistencies in the method of calculation. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, the Company and certain investors use this information to evaluate the Company's performance. Refer to pages 9-13 of this news release for a discussion and the reconciliation of these non-GAAP measurements to the Company's Unaudited Condensed Interim Financial Statements for Q2 2014.
The Unaudited Balance Sheets, Statements of Operations and Statements of Cash Flows for the Company for the three months and the six months ended June 30, 2014, can be found on pages 17-19.
To review the complete Unaudited Condensed Financial Statements for Q2 2014, and the Interim Management's Discussion and Analysis for Q2 2014, please see SAS's SEDAR filings under the Company's profile at www.sedar.com or the Company's website at www.sasgoldmines.com.
The following abbreviations are used to describe the periods under review throughout this release.
| Abbreviation | Period | Abbreviation | Period | |||||||||
| Q1 2014 | January 1, 2014 - March 31, 2014 | Q2 2013 | April 1, 2013 - June 30, 2013 | |||||||||
| Q2 2014 | April 1, 2014 - June 30, 2014 | YTD 2013 | January 1, 2013 - June 30, 2013 | |||||||||
| YTD 2014 | January 1, 2014 - June 30, 2014 | Q3 2013 | July 1, 2013 - September 30, 2013 | |||||||||
| Q3 2014 | July 1, 2014 - September 30, 2014 | Q4 2013 | October 1, 2013 - December 31, 2013 | |||||||||
| Q4 2014 | October 1, 2014 - December 31, 2014 | FY 2013 | January 1, 2013 - December 31, 2013 | |||||||||
| FY 2014 | January 1, 2014 - December 31, 2014 | Q4 2012 | October 1, 2012 - December 31, 2012 | |||||||||
| Q1 2013 | January 1, 2013 - March 31, 2013 | Q3 2012 | July 1, 2012 - September 30, 2012 |
FORWARD-LOOKING INFORMATION
This news release contains forward-looking information and forward-looking statements (collectively, "forward-looking information") under applicable securities laws, concerning the Company's business, operations, financial performance, condition and prospects, as well as management's objectives, strategies, beliefs and intentions. Forward-looking information is frequently identified by such words as "may", "will", "plan", "expect", "estimate", "anticipate", "believe", "intend" and similar words referring to future events and results, including the Company's production and cash cost guidance for 2014; the relative production contributions from each of the operations; the level of capital expenditures at Holt, Holloway, the Holt Mill, and the Taylor Project; the continuation of advanced exploration at Taylor including the planned second bulk sample and the timing thereof; and the extent of the exploration programs in 2014. In addition, mineral resources and mineral reserves constitute forward-looking information as they involve the assessment, based on certain estimates and assumptions, that such mineral resources and mineral reserves can be profitably produced in the future.
This forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information. Factors that may cause actual results to vary materially include, but are not limited to, uncertainties relating to the interpretation of exploration results, the geology, continuity, grade and size estimates of the mineral reserves and resources; unanticipated operational or technical difficulties which could escalate operating and/or capital costs and reduce anticipated production levels; the Company's dependence on key employees and changes in the availability of qualified personnel; fluctuations in gold prices and exchange rates; insufficient funding or delays or inability to raise additional financing on satisfactory terms if required; operational hazards and risks, including the inability to insure against all risks; changes in laws, regulations and the risks of obtaining necessary licenses and permits; changes in general economic conditions and changes in conditions in the financial markets. Such forward looking information is based on a number of assumptions, including but not limited to the level and volatility of the price of gold, the accuracy of reserve and resource estimates and the assumptions on which such estimates are based, the ability to achieve capital and operating cost estimates, the ability of the Company to retain and attract qualified personnel, the sufficiency of the Company's cash reserves and operating cash flow to complete planned development and exploration activities, the availability of additional financing on acceptable terms if and as required and the level of stability of general business and economic conditions. Should one or more risks and uncertainties materialize or should any assumptions prove incorrect, then actual results could vary materially from those expressed or implied in the forward-looking information and accordingly, readers are cautioned not to place undue reliance on this forward-looking information. SAS does not assume the obligation to revise or update this forward‐looking information after the date of this release or to revise such information to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws. A description of these risks and uncertainties can also be found in the Company's Annual Information Form obtained on SEDAR at www.sedar.com.
NON-GAAP MEASURES
Adjusted net earnings (loss)
Adjusted net earnings (loss) is a non-GAAP performance measure which does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. As well, it may not be comparable to information in other gold producers' reports and filings. Adjusted net earnings (loss) is calculated by removing the gains and losses, resulting from the mark-to-market revaluation of the Company's gold-linked liabilities and foreign currency derivative contracts, one-time gains or losses on the disposition of non-core assets, periodic adjustments to the Company's asset retirement obligations, and expenses, asset impairment gains or losses and significant tax adjustments not related to current period's earnings, as detailed in the table below. The Company discloses this measure, which is based on its Financial Statements, to assist in the understanding of the Company's operating results and financial position.
| Amounts in thousands of Canadian dollars, except per share amounts | Q2 2014 | Q1 2014 | Q2 2013 | YTD 2014 | YTD 2013 | ||||||||||||
| Net income (loss) per Financial Statements | $ | 553 | $ | (1,806) | $ | (1,093) | $ | (1,253) | $ | (54) | |||||||
| Reversal of unrecognized deferred income tax assets | - | - | - | - | (1,256) | ||||||||||||
| Mark-to-market loss (gain) on gold-linked liabilities | (56) | 456 | (1,520) | 400 | (1,711) | ||||||||||||
| Mark-to-market loss on foreign currency derivatives | (1,128) | 245 | 818 | (883) | 2,058 | ||||||||||||
| Impairment loss on available-for-sale investments | - | - | - | - | 500 | ||||||||||||
| Loss on disposal of fixed assets | 149 | - | - | 149 | - | ||||||||||||
| Write-down of investment in joint venture | - | - | 374 | - | 374 | ||||||||||||
| Write-down of mining equipment | - | - | 620 | - | 620 | ||||||||||||
| Reversal of provision | (777) | - | (777) | - | |||||||||||||
| Tax effect of above items | 296 | 19 | (73) | 315 | (335) | ||||||||||||
| Adjusted net earnings (loss) | $ | (186) | $ | (1,863) | $ | (874) | $ | (2,049) | $ | 196 | |||||||
| Weighted average number of shares outstanding (000s) | |||||||||||||||||
| Basic | 368,296 | 368,296 | 368,246 | 368,296 | 368,246 | ||||||||||||
| Diluted | 368,337 | 368,296 | 368,277 | 368,296 | 368,537 | ||||||||||||
| Adjusted net earnings (loss) per share - basic and diluted | $ | 0.00 | $ | (0.01) | $ | 0.00 | $ | (0.01) | $ | 0.00 | |||||||
Total cash cost per ounce of gold sold
Total cash cost per ounce of gold sold is a non-GAAP performance measure which does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. As well, it may not be comparable to information in other gold producers' reports and filings. The Company has included this non-GAAP performance measure throughout this document as the Company believes that this generally accepted industry performance measure provides a useful indication of the Company's operational performance. 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. Accordingly, it 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. The following table provides a reconciliation of total cash costs per ounce of gold sold to production expenses per the Financial Statements:
| Amounts in thousands of Canadian dollars, except where indicated | Q2 2014 | Q1 2014 | Q2 2013 | YTD 2014 | YTD 2013 | ||||||||||||||
| Mine site operating costs per Financial Statements (1) | $ | 18,959 | $ | 19,189 | $ | 19,996 | $ | 38,148 | $ | 38,407 | |||||||||
| Production royalties per Financial Statements | 2,758 | 3,017 | 3,012 | 5,775 | 6,382 | ||||||||||||||
| Total cash costs | $ | 21,717 | $ | 22,206 | $ | 23,008 | $ | 43,923 | $ | 44,789 | |||||||||
| Divided by gold ounces sold | 22,850 | 23,500 | 25,060 | 46,350 | 48,069 | ||||||||||||||
| Total cash cost per ounce of gold sold (Canadian dollars) | $ | 950 | $ | 945 | $ | 918 | $ | 948 | $ | 932 | |||||||||
| Average USD:CAD exchange rate | $ | 1.09 | $ | 1.10 | $ | 1.02 | $ | 1.10 | $ | 1.02 | |||||||||
| Total cash cost per ounce of gold sold (US$) | $ | 872 | $ | 856 | $ | 897 | $ | 864 | $ | 917 | |||||||||
| Notes: | |
| (1) | Included in mine site operating costs for Q2 2014 and YTD 2014 was revenue from toll milling of $0.3 million earned in Q2 2014. |
All-in sustaining cost per ounce of gold sold
All-in sustaining cost per ounce of gold sold is a non-GAAP performance measure and does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. As well, it may not be comparable to information in other gold producers' reports and filings. The Company has included this non-GAAP performance measure throughout this document as the Company believes that this generally accepted industry performance measure provides a useful indication of the Company's operational performance. All-in sustaining costs include mine-site operating costs and production royalties incurred at the Company's mining operations, sustaining capital expenditures (which the Company defines as any capital expenditures that are reinvested into the business to maintain the current level of operations), corporate administration expense, mine site exploration costs, and reclamation cost accretion. The Company believes that this measure represents the total costs of producing gold from current operations, and provides the Company and other stakeholders with additional information that illustrates the Company's operational performance and ability to generate cash flow. This cost measure is reported on a consolidated level and on a per-ounce of gold sold basis in accordance with the guidelines published by the World Gold Council. As the measure seeks to reflect the full cost of gold production from current operations, new project capital is not included. Certain other cash expenditures, including tax payments and financing costs are also not included.
| Amounts in thousands of Canadian dollars, except where indicated | Q2 2014 | Q1 2014 | Q2 2013 | YTD 2014 | YTD 2013 | ||||||||||||||
| Mine site operating costs per Financial Statements (1) | $ | 18,959 | $ | 19,189 | $ | 19,996 | $ | 38,148 | $ | 38,407 | |||||||||
| Production royalties per Financial Statements | 2,758 | 3,017 | 3,012 | 5,775 | 6,382 | ||||||||||||||
| Add (less): | |||||||||||||||||||
| Sustaining mine capital | 3,921 | 4,349 | 3,751 | 8,270 | 7,961 | ||||||||||||||
| Mine site exploration | 207 | 227 | 2,174 | 434 | 3,536 | ||||||||||||||
| Mine reclamation obligation | 104 | 104 | 98 | 208 | 198 | ||||||||||||||
| Corporate administration | 1,402 | 1,362 | 1,688 | 2,764 | 3,951 | ||||||||||||||
| All-in sustaining costs | $ | 27,351 | $ | 28,248 | $ | 30,719 | $ | 55,599 | $ | 60,436 | |||||||||
| Divided by gold ounces sold | 22,850 | 23,500 | 25,060 | 46,350 | 48,069 | ||||||||||||||
| All-in sustaining cost per ounce of gold sold (Canadian dollars) | $ | 1,197 | $ | 1,202 | $ | 1,226 | $ | 1,200 | $ | 1,257 | |||||||||
| Average USD:CAD exchange rate | $ | 1.09 | $ | 1.10 | $ | 1.02 | $ | 1.10 | $ | 1.02 | |||||||||
| All-in sustaining cost per ounce of gold sold (US$) | $ | 1,098 | $ | 1,089 | $ | 1,198 | $ | 1,094 | $ | 1,237 | |||||||||
| Notes: | |
| (1) | Included in mine site operating costs for Q2 2014 and YTD 2014 was revenue from toll milling of $0.3 million earned in Q2 2014. |
Mine site cost per tonne milled
Mine site cost per tonne milled is a non-GAAP performance measure and does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. As well, it may not be comparable to information in other gold producers' reports and filings. As illustrated in the table below, this measure is calculated by adjusting Production Costs, as shown in the statements of operations for inventory level changes and then dividing by tonnes processed through the mill. Since total cash cost per ounce of gold sold data can be affected by fluctuations in foreign currency exchange rates, Management believes that mine site cost per tonne milled provides additional information regarding the performance of mining operations and allows Management to monitor operating costs on a more consistent basis as the per tonne milled measure reduces the cost variability associated with varying production levels. Management also uses this measure to determine the economic viability of mining blocks. As each mining block is evaluated based on the net realizable value of each tonne mined, the estimated revenue on a per tonne basis must be in excess of the mine site cost per tonne milled in order to be economically viable. Management is aware that this per tonne milled measure is impacted by fluctuations in throughput and thus uses this evaluation tool in conjunction with production costs prepared in accordance with IFRS. This measure supplements production cost information prepared in accordance with IFRS and allows investors to distinguish between changes in production costs resulting from changes in production versus changes in operating performance.
| Amounts in thousands of Canadian dollars, except per tonne amounts | Q2 2014 | Q1 2014 | Q2 2013 | YTD 2014 | YTD 2013 | |||||||||||||
| Holt Mine | ||||||||||||||||||
| Mine site costs | $ | 10,915 | $ | 10,304 | $ | 9,270 | $ | 21,219 | $ | 17,833 | ||||||||
| Inventory adjustments (1) | 354 | 600 | (421) | 954 | 596 | |||||||||||||
| Mine site operating costs | $ | 11,269 | $ | 10,904 | $ | 8,849 | $ | 22,173 | $ | 18,429 | ||||||||
| Divided by tonnes of ore milled | 106,282 | 113,279 | 93,081 | 219,561 | 183,066 | |||||||||||||
| Mine site cost per tonne milled | $ | 106 | $ | 96 | $ | 95 | $ | 101 | $ | 101 | ||||||||
| Holloway Mine | ||||||||||||||||||
| Mine site costs | $ | 5,506 | $ | 6,181 | $ | 5,015 | $ | 11,687 | $ | 10,074 | ||||||||
| Inventory adjustments (1) | (441) | 374 | 153 | (67) | 473 | |||||||||||||
| Mine site operating costs | $ | 5,065 | $ | 6,555 | $ | 5,168 | $ | 11,620 | $ | 10,547 | ||||||||
| Divided by tonnes of ore milled | 40,932 | 42,981 | 45,642 | 83,913 | 88,894 | |||||||||||||
| Mine site cost per tonne milled | $ | 124 | $ | 153 | $ | 113 | $ | 138 | $ | 119 | ||||||||
| Hislop Mine | ||||||||||||||||||
| Mine-site costs | $ | 2,540 | $ | 2,704 | $ | 5,711 | $ | 5,244 | $ | 10,499 | ||||||||
| Inventory adjustments (1) | (49) | 56 | (100) | 7 | 437 | |||||||||||||
| Mine site operating costs | $ | 2,491 | $ | 2,760 | $ | 5,611 | $ | 5,251 | $ | 10,936 | ||||||||
| Divided by tonnes of ore milled | 47,785 | 31,999 | 88,093 | 79,784 | 167,864 | |||||||||||||
| Mine site cost per tonne milled | $ | 52 | $ | 86 | $ | 64 | $ | 66 | $ | 65 | ||||||||
| Notes: | |
| (1) | Inventory adjustment reflects production costs associated with unsold bullion and in-circuit inventory. |
Cash margin from mine operations
Cash margin from mine operations is a non-GAAP measure and does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. As well, it may not be comparable to information in other gold producers' reports and filings. It is calculated as the difference between gold sales and production costs (comprised of mine site operating costs and production royalties) per the Company's Financial Statements. The Company believes it illustrates the performance of the Company's operating mines and enables investors to better understand the Company's performance in comparison to other gold producers who present results on a similar basis.
| Amounts in thousands of Canadian dollars | Q2 2014 | Q1 2014 | Q2 2013 | YTD 2014 | YTD 2013 | ||||||||||||||||
| Gold sales per Financial Statements | [A] | $ | 31,665 | $ | 33,481 | $ | 36,723 | $ | 65,146 | $ | 74,913 | ||||||||||
| Mine site operating costs per Financial Statements (1) | 18,959 | 19,189 | 19,996 | 38,148 | 38,407 | ||||||||||||||||
| Production royalties per Financial Statements | 2,758 | 3,017 | 3,012 | 5,775 | 6,382 | ||||||||||||||||
| [B] | 21,717 | 22,206 | 23,008 | 43,923 | 44,789 | ||||||||||||||||
| Cash margin from mine operations | [A] - [B] | $ | 9,948 | $ | 11,275 | $ | 13,715 | $ | 21,223 | $ | 30,124 | ||||||||||
| Breakdown of cash margin from mine operations by mines: | |||||||||||||||||||||
| Holt Mine | $ | 8,407 | $ | 10,819 | $ | 9,341 | $ | 19,226 | $ | 21,228 | |||||||||||
| Holloway Mine | 1,083 | 589 | 1,795 | 1,672 | 4,186 | ||||||||||||||||
| Hislop Mine | 458 | (133) | 2,579 | 325 | 4,710 | ||||||||||||||||
| $ | 9,948 | $ | 11,275 | $ | 13,715 | $ | 21,223 | $ | 30,124 | ||||||||||||
| Notes: | |
| (1) | Included in Mine site operating costs for Q2 2014 and YTD 2014 was revenue from toll milling of $0.3 million earned in Q2 2014. |
Average realized price per ounce of gold sold
Average realized price per ounce of gold sold is a non-GAAP measure and does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. Average realized price per ounce of gold sold is calculated by dividing gold sales proceeds received by the Company for the relevant period by the ounces of gold sold. It may not be comparable to information in other gold producers' reports and filings.
| Amounts in thousands of Canadian dollars, except where indicated | Q2 2014 | Q1 2014 | Q2 2013 | YTD 2014 | YTD 2013 | ||||||||||||||
| Gold sales per Financial Statements | $ | 31,665 | $ | 33,481 | $ | 36,723 | $ | 65,146 | $ | 74,913 | |||||||||
| Foreign exchange gain realized on the settlement of gold sales | 192 | (94) | - | 98 | - | ||||||||||||||
| Gain (loss) on foreign currency derivative cash flow hedges realized | 158 | 229 | (172) | 387 | (172) | ||||||||||||||
| $ | 32,015 | $ | 33,616 | $ | 36,551 | $ | 65,631 | $ | 74,741 | ||||||||||
| Average USD:CAD exchange rate | 1.09 | 1.10 | 1.02 | 1.10 | 1.02 | ||||||||||||||
| Gold sales recorded in US$ | $ | 29,353 | $ | 30,406 | $ | 35,784 | $ | 59,759 | $ | 73,330 | |||||||||
| Divided by gold ounces sold | 22,850 | 23,500 | 25,060 | 46,350 | 48,069 | ||||||||||||||
| Average realized price per ounce of gold sold (US$) | $ | 1,285 | $ | 1,294 | $ | 1,428 | $ | 1,289 | $ | 1,526 | |||||||||
Cash margin per ounce of gold sold
Cash margin per ounce of gold sold is a non-GAAP measure and does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. Cash margin per ounce of gold sold is calculated by subtracting the total cash cost per ounce of gold sold from the average realized price per ounce of gold sold. It may not be comparable to information in other gold producers' reports and filings.
| Amounts in United States dollars | Q2 2014 | Q1 2014 | Q2 2013 | YTD 2014 | YTD 2013 | ||||||||||||||||||
| Per ounce of gold sold: | |||||||||||||||||||||||
| Average realized price per ounce of gold sold | [A] | $ | 1,285 | $ | 1,294 | $ | 1,428 | $ | 1,289 | $ | 1,526 | ||||||||||||
| Total cash cost per ounce of gold sold | [B] | 872 | 856 | 897 | 864 | 917 | |||||||||||||||||
| Cash margin per ounce of gold sold | [A] - [B] | $ | 413 | $ | 438 | $ | 531 | $ | 425 | $ | 609 | ||||||||||||
Net cash flow
Net cash flow is a non-GAAP measure and does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. Net cash flow is calculated by taking cash flow from operating activities less cash used in investing activities as reported in the Company's Financial Statements. It may not be comparable to information in other gold producers' reports and filings.
| Amounts in thousands of Canadian dollars | Q2 2014 | Q1 2014 | Q2 2013 | YTD 2014 | YTD 2013 | ||||||||||||||
| Cash flow from operating activities per Financial Statements | $ | 5,461 | $ | 9,468 | $ | 6,968 | $ | 14,929 | $ | 20,748 | |||||||||
| Less: | |||||||||||||||||||
| Cash used in investing activities per Financial Statements | 8,108 | 7,987 | 7,315 | 16,095 | 17,304 | ||||||||||||||
| $ | (2,647) | $ | 1,481 | $ | (347) | $ | (1,166) | $ | 3,444 | ||||||||||
Operating cash flow per share
Operating cash flow per share is a non-GAAP measure and does not constitute a measure recognized by IFRS and does not have a standardized meaning defined by IFRS. Operating cash flow per share is calculated by dividing cash flow from operating activities in the Company's Financial Statements by the weighted average number of shares outstanding for each period. It may not be comparable to information in other gold producers' reports and filings.
| Amounts in thousands of Canadian dollars, except per share amounts | Q2 2014 | Q1 2014 | Q2 2013 | YTD 2014 | YTD 2013 | ||||||||||||||
| Cash flow from operating activities per Financial Statements | $ | 5,461 | $ | 9,468 | $ | 6,968 | $ | 14,929 | $ | 20,748 | |||||||||
| Weighted average number of shares outstanding (000s) | 368,296 | 368,296 | 368,246 | 368,296 | 368,246 | ||||||||||||||
| Operating cash flow per share | $ | 0.01 | $ | 0.03 | $ | 0.02 | $ | 0.04 | $ | 0.06 | |||||||||
Operating and Financial Statistics - Holt Mine
| Amounts in thousands of Canadian dollars, except per unit amounts | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | Q1 2013 | Q4 2012 | Q3 2012 | YTD 2014 | YTD 2013 | |||||||||||||||||||||
| Tonnes milled | 106,282 | 113,279 | 81,791 | 104,800 | 93,081 | 89,985 | 89,901 | 80,219 | 219,561 | 183,066 | |||||||||||||||||||||
| Head grade (g/t Au) | 4.70 | 5.08 | 5.42 | 5.25 | 4.83 | 5.40 | 5.51 | 5.40 | 4.90 | 5.11 | |||||||||||||||||||||
| Average mill recovery | 94.2% | 94.6% | 95.2% | 95.0% | 94.9% | 94.8% | 94.7% | 94.4% | 94.4% | 94.8% | |||||||||||||||||||||
| Gold produced (ounces) | 15,140 | 17,497 | 13,579 | 16,807 | 13,706 | 14,806 | 15,082 | 13,145 | 32,637 | 28,512 | |||||||||||||||||||||
| Commercial gold production sold (ounces) | 15,534 | 16,516 | 13,775 | 16,381 | 14,230 | 13,715 | 15,043 | 12,373 | 32,050 | 27,945 | |||||||||||||||||||||
| Gold sales revenue | $ | 21,521 | $ | 23,541 | $ | 18,239 | $ | 22,417 | $ | 20,865 | $ | 22,750 | $ | 25,584 | $ | 20,000 | $ | 45,062 | $ | 43,615 | |||||||||||
| Cash margin from mine operations (1) | $ | 8,407 | $ | 10,819 | $ | 6,915 | $ | 10,677 | $ | 9,341 | $ | 11,887 | $ | 14,538 | $ | 9,250 | $ | 19,226 | $ | 21,228 | |||||||||||
| Mine site cost per tonne milled (1) | $ | 106 | $ | 96 | $ | 114 | $ | 90 | $ | 95 | $ | 106 | $ | 93 | $ | 112 | $ | 101 | $ | 101 | |||||||||||
| Total cash cost per ounce of gold sold (US dollars) (1) | |||||||||||||||||||||||||||||||
| Mine cash costs | $ | 644 | $ | 565 | $ | 636 | $ | 548 | $ | 636 | $ | 619 | $ | 573 | $ | 708 | $ | 604 | $ | 628 | |||||||||||
| Royalty costs | 130 | 133 | 147 | 143 | 155 | 166 | 168 | 165 | 131 | 160 | |||||||||||||||||||||
| Total cash cost per ounce of gold sold | $ | 774 | $ | 698 | $ | 783 | $ | 691 | $ | 791 | $ | 785 | $ | 741 | $ | 873 | $ | 735 | $ | 788 | |||||||||||
| Capital expenditures | $ | 3,608 | $ | 4,072 | $ | 2,991 | $ | 3,104 | $ | 3,487 | $ | 3,383 | $ | 4,536 | $ | 4,990 | $ | 7,680 | $ | 6,870 | |||||||||||
| Depreciation and depletion expense | $ | 2,749 | $ | 2,793 | $ | 2,602 | $ | 2,338 | $ | 2,667 | $ | 2,709 | $ | 2,979 | $ | 2,293 | $ | 5,542 | $ | 5,376 | |||||||||||
| Notes: | |
| (1) | Total cash cost per ounce of gold sold, mine site cost per tonne milled and cash margin from mine operations are non-GAAP measures which do not have standardized meanings as prescribed by IFRS and are not necessarily comparable to similarly titled measures of other companies due to potential inconsistencies in the method of calculation (see pages 9-13 for an explanation and reconciliation of non-GAAP measurements). |
Operating and Financial Statistics - Holloway Mine
| Amounts in thousands of Canadian dollars, except per unit amounts | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | Q1 2013 | Q4 2012 | Q3 2012 | Q2 2012 | YTD 2014 | YTD 2013 | |||||||||||||||||||||||
| Tonnes milled | 40,932 | 42,981 | 47,960 | 40,152 | 45,642 | 43,252 | 46,606 | 44,546 | 53,169 | 83,913 | 88,894 | |||||||||||||||||||||||
| Head grade (g/t Au) | 4.09 | 4.14 | 4.13 | 4.02 | 4.32 | 4.04 | 3.90 | 4.15 | 3.80 | 4.12 | 4.19 | |||||||||||||||||||||||
| Average mill recovery | 90.9% | 90.1% | 88.9% | 89.7% | 92.6% | 91.5% | 89.7% | 91.0% | 91.2% | 90.5% | 92.1% | |||||||||||||||||||||||
| Gold produced (ounces) | 4,893 | 5,154 | 5,654 | 4,662 | 5,874 | 5,140 | 5,240 | 5,408 | 5,923 | 10,047 | 11,014 | |||||||||||||||||||||||
| Commercial gold production sold (ounces) | 5,157 | 5,175 | 5,105 | 5,741 | 5,175 | 5,126 | 4,981 | 5,749 | 5,744 | 10,332 | 10,301 | |||||||||||||||||||||||
| Gold sales revenue | $ | 7,149 | $ | 7,369 | $ | 6,734 | $ | 7,831 | $ | 7,568 | $ | 8,521 | $ | 8,473 | $ | 9,267 | $ | 9,467 | $ | 14,518 | $ | 16,089 | ||||||||||||
| Cash margin from mine operations (1) | $ | 1,083 | $ | 589 | $ | 562 | $ | 1,561 | $ | 1,795 | $ | 2,391 | $ | 3,262 | $ | 3,835 | $ | 3,805 | $ | 1,672 | $ | 4,186 | ||||||||||||
| Mine site cost per tonne milled (1) | $ | 124 | $ | 153 | $ | 122 | $ | 131 | $ | 113 | $ | 124 | $ | 94 | $ | 92 | $ | 82 | $ | 138 | $ | 119 | ||||||||||||
| Total cash cost per ounce of gold sold (US dollars)(1) | ||||||||||||||||||||||||||||||||||
| Mine cash costs | $ | 979 | $ | 1,082 | $ | 1,041 | $ | 938 | $ | 947 | $ | 977 | $ | 834 | $ | 746 | $ | 771 | $ | 1,031 | $ | 962 | ||||||||||||
| Royalty costs | 100 | 105 | 111 | 114 | 143 | 209 | 221 | 204 | 205 | 102 | 175 | |||||||||||||||||||||||
| Total cash cost per ounce of gold sold | $ | 1,079 | $ | 1,187 | $ | 1,152 | $ | 1,052 | $ | 1,090 | $ | 1,186 | $ | 1,055 | $ | 950 | $ | 976 | $ | 1,133 | $ | 1,137 | ||||||||||||
| Capital expenditures | $ | 270 | $ | 250 | $ | 130 | $ | 816 | $ | 1,189 | $ | 912 | $ | 1,443 | $ | 1,794 | $ | 2,539 | $ | 520 | $ | 2,101 | ||||||||||||
| Depreciation and depletion expense | $ | 3,266 | $ | 7,325 | $ | 4,848 | $ | 4,843 | $ | 2,149 | $ | 2,144 | $ | 1,970 | $ | 2,346 | $ | 2,181 | $ | 10,591 | $ | 4,293 | ||||||||||||
| Notes: | |
| (1) | Total cash cost per ounce of gold sold, mine site cost per tonne milled and cash margin from mine operations, are non-GAAP measures which do not have standardized meanings as prescribed by IFRS and are not necessarily comparable to similarly titled measures of other companies due to potential inconsistencies in the method of calculation (see pages 9-13 hereof for an explanation and reconciliation of non-GAAP measurements). |
Operating and Financial Statistics - Hislop Mine
| Amounts in thousands of Canadian dollars, except per unit amounts | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | Q1 2013 | Q4 2012 | Q3 2012 | YTD 2014 | YTD 2013 | |||||||||||||||||||||
| Overburden stripped (m3) | - | - | 19,646 | 43,094 | 64,807 | - | - | (32,205) | - | 64,807 | |||||||||||||||||||||
| Tonnes mined | (ore) | 28,851 | 51,120 | 35,540 | 92,378 | 105,900 | 82,361 | 101,617 | 99,287 | 79,971 | 188,261 | ||||||||||||||||||||
| (waste) | 5,000 | 218,712 | 377,627 | 389,978 | 312,705 | 267,906 | 453,629 | 513,988 | 223,712 | 580,611 | |||||||||||||||||||||
| 33,851 | 269,832 | 413,167 | 482,356 | 418,605 | 350,267 | 555,246 | 613,275 | 303,683 | 768,872 | ||||||||||||||||||||||
| Waste-to-Ore Ratio | 0.2 | 4.3 | 10.6 | 4.2 | 3.0 | 3.3 | 4.5 | 5.2 | 2.8 | 3.1 | |||||||||||||||||||||
| Tonnes milled | 47,785 | 31,999 | 98,293 | 66,940 | 88,093 | 79,771 | 95,516 | 102,191 | 79,784 | 167,864 | |||||||||||||||||||||
| Head grade (g/t Au) | 2.14 | 2.09 | 1.96 | 2.27 | 2.43 | 2.14 | 2.22 | 2.53 | 2.12 | 2.29 | |||||||||||||||||||||
| Average mill recovery | 75.1% | 79.4% | 81.6% | 81.0% | 84.0% | 82.1% | 80.8% | 86.5% | 76.8% | 83.2% | |||||||||||||||||||||
| Gold produced (ounces) | 2,472 | 1,710 | 5,068 | 3,965 | 5,773 | 4,515 | 5,507 | 7,189 | 4,182 | 10,288 | |||||||||||||||||||||
| Commercial gold production sold (ounces) | 2,159 | 1,809 | 5,105 | 4,478 | 5,655 | 4,168 | 6,026 | 7,075 | 3,968 | 9,823 | |||||||||||||||||||||
| Gold sales revenue | $ | 2,995 | $ | 2,571 | $ | 6,734 | $ | 6,115 | $ | 8,290 | $ | 6,919 | $ | 10,275 | $ | 11,423 | $ | 5,566 | $ | 15,209 | |||||||||||
| Cash margin from mine operations (1) | $ | 458 | $ | (133) | $ | 294 | $ | 1,143 | $ | 2,579 | $ | 2,131 | $ | 3,700 | $ | 5,165 | $ | 325 | $ | 4,710 | |||||||||||
| Mine site cost per tonne milled (1) | $ | 52 | $ | 86 | $ | 69 | $ | 67 | $ | 64 | $ | 67 | $ | 65 | $ | 62 | $ | 66 | $ | 65 | |||||||||||
| Total cash cost per ounce of gold sold (1)(2) | $ | 1,079 | $ | 1,354 | $ | 1,202 | $ | 1,070 | $ | 987 | $ | 1,139 | $ | 1,100 | $ | 889 | $ | 1,205 | $ | 1,052 | |||||||||||
| Capital expenditures | $ | - | $ | - | $ | - | $ | 20 | $ | - | $ | - | $ | (39) | $ | 390 | $ | - | $ | - | |||||||||||
| Depreciation and depletion expense | $ | 126 | $ | 75 | $ | 2,186 | $ | 2,364 | $ | 4,252 | $ | 3,224 | $ | 1,981 | $ | 1,644 | $ | 201 | $ | 7,476 | |||||||||||
| Notes: | |
| (1) | Total cash cost per ounce of gold sold, mine site cost per tonne milled and cash margin from mine operations are non-GAAP measures which do not have standardized meanings as prescribed by IFRS and are not necessarily comparable to similarly titled measures of other companies due to potential inconsistencies in the method of calculation (see pages 9-13 hereof for an explanation and reconciliation of non-GAAP measurements). |
| (2) | Hislop is subject to a 4% net smelter return royalty, which includes a minimum Advance royalty payment obligation (see "Gold-linked Liabilities" in the Company's Q2 2014 MD&A). |
Statements of Operations (unaudited)
St Andrew Goldfields Ltd.
Expressed in thousands of Canadian dollars except per share information
| Three months ended June 30, | Six months ended June 30, | |||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||
| Gold sales | $ | 31,665 | $ | 36,723 | $ | 65,146 | $ | 74,913 | ||||||
| Operating costs and expenses: | ||||||||||||||
| Mine site operating | 18,959 | 19,996 | 38,148 | 38,407 | ||||||||||
| Production royalty | 2,758 | 3,012 | 5,775 | 6,382 | ||||||||||
| Site maintenance | (34) | 39 | 8 | 160 | ||||||||||
| Exploration | 1,263 | 2,599 | 2,428 | 5,110 | ||||||||||
| Corporate administration | 1,402 | 1,688 | 2,764 | 3,953 | ||||||||||
| Depreciation and depletion | 6,370 | 9,304 | 16,790 | 17,588 | ||||||||||
| Loss on disposal of fixed assets | 149 | - | 149 | - | ||||||||||
| Write-down of investment in joint venture | - | 374 | - | 374 | ||||||||||
| Write-down of mining equipment | - | 620 | - | 620 | ||||||||||
| 30,867 | 37,632 | 66,062 | 72,594 | |||||||||||
| Operating income (loss) | 798 | (909) | (916) | 2,319 | ||||||||||
| Finance costs | 421 | 497 | 969 | 1,001 | ||||||||||
| Mark-to-market (gain) loss on gold-linked liabilities | (56) | (1,520) | 400 | (1,711) | ||||||||||
| Mark-to-market (gain) loss on foreign currency derivatives | (1,128) | 818 | (883) | 2,058 | ||||||||||
| Foreign exchange loss | 458 | 311 | 1,241 | 315 | ||||||||||
| Impairment loss on available-for-sale investments | - | - | - | 500 | ||||||||||
| Finance income and other | (70) | (78) | (940) | (155) | ||||||||||
| (375) | 28 | 787 | 2,008 | |||||||||||
| Income (loss) before taxes | 1,173 | (937) | (1,703) | 311 | ||||||||||
| Net deferred tax expense (recovery) | 620 | 156 | (450) | 365 | ||||||||||
| Net income (loss) attributable to shareholders | $ | 553 | $ | (1,093) | $ | (1,253) | $ | (54) | ||||||
| Other comprehensive income (loss) | ||||||||||||||
| Unrealized gain (loss) on available-for-sale investments (nil tax effect) | (23) | (36) | 115 | (131) | ||||||||||
| Reclassification adjustment for impairment loss on available-for-sale investments (nil tax effect) |
- | - | - | 500 | ||||||||||
| Unrealized gain (loss) on derivatives designated as cash flow hedges, net of tax of $42 , $392, $34 , $546 |
126 | (1,176) | 104 | (1,639) | ||||||||||
| 103 | (1,212) | 219 | (1,270) | |||||||||||
| Comprehensive income (loss) for the period | $ | 656 | $ | (2,305) | $ | (1,034) | $ | (1,324) | ||||||
| Basic and diluted income (loss) per share | $ | 0.00 | $ | 0.00 | $ | 0.00 | $ | 0.00 | ||||||
| Weighted average number of shares outstanding (000's) | ||||||||||||||
| Basic | 368,296 | 368,246 | 368,296 | 368,246 | ||||||||||
| Diluted | 368,337 | 368,277 | 368,296 | 368,537 | ||||||||||
Statements of Cash Flows (unaudited)
St Andrew Goldfields Ltd.
Expressed in thousands of Canadian dollars
| Three months ended June 30, | Six months ended June 30, | ||||||||||
| 2014 | 2013 | 2014 | 2013 | ||||||||
| Operating activities: | |||||||||||
| Net Income (loss) for the period | $ | 553 | $ | (1,093) | $ | (1,253) | $ | (54) | |||
| Items not affecting cash: | |||||||||||
| Net deferred tax expense (recovery) | 620 | 156 | (450) | 365 | |||||||
| Mark-to-market loss (gain) on gold-linked liabilities | (56) | (1,520) | 400 | (1,711) | |||||||
| Non-cash interest | 348 | 358 | 767 | 724 | |||||||
| Mark-to-market loss on foreign currency derivatives | (1,128) | 818 | (883) | 2,058 | |||||||
| Depreciation and depletion | 6,370 | 9,304 | 16,790 | 17,588 | |||||||
| Reversal of provision | - | - | (777) | - | |||||||
| Write-down of investment in joint venture | - | 374 | 374 | ||||||||
| Write-down of mining equipment and investment | - | 620 | - | 620 | |||||||
| Impairment loss on available-for-sale investments | - | - | - | 500 | |||||||
| Loss (gain) on divestiture of non-core assets | 149 | - | 149 | - | |||||||
| Share-based payments | 146 | 263 | 190 | 586 | |||||||
| Net change in non-cash operating working capital and other | (1,496) | (2,197) | 144 | (61) | |||||||
| Interest paid | (45) | (115) | (148) | (241) | |||||||
| Cash provided by operating activities | 5,461 | 6,968 | 14,929 | 20,748 | |||||||
| Investing activities: | |||||||||||
| Additions to exploration and evaluation assets | (3,746) | (1,152) | (8,110) | (5,162) | |||||||
| Mine development expenditures | (2,000) | (3,707) | (4,610) | (6,694) | |||||||
| Additions to plant and equipment | (2,030) | (1,404) | (3,922) | (3,637) | |||||||
| Amounts payable on capital additions | (400) | (1,013) | 495 | (1,429) | |||||||
| Reclamation costs and other | (17) | (16) | (33) | (359) | |||||||
| Proceeds on disposal of fixed assets | 85 | - | 85 | - | |||||||
| Cash collateralized for banking facilities | - | (23) | - | (23) | |||||||
| Cash used in investing activities | (8,108) | (7,315) | (16,095) | (17,304) | |||||||
| Financing activities: | |||||||||||
| Advance royalty payments | (289) | (464) | (708) | (972) | |||||||
| Capital lease payments | (280) | (186) | (540) | (263) | |||||||
| Repayment of term credit facility | (7,576) | - | (9,815) | (2,032) | |||||||
| Cash used in financing activities | (8,145) | (650) | (11,063) | (3,267) | |||||||
| Effects of exchange rate changes on cash and cash equivalents | (760) | 394 | (1,398) | 667 | |||||||
| Increase (decrease) in cash and cash equivalents | (11,552) | (603) | (13,627) | 844 | |||||||
| Cash and cash equivalents, beginning of period | 31,615 | 32,103 | 33,690 | 30,656 | |||||||
| Cash and cash equivalents, end of period | $ | 20,063 | $ | 31,500 | $ | 20,063 | $ | 31,500 | |||
Balance Sheets (unaudited)
St Andrew Goldfields Ltd.
Expressed in thousands of Canadian dollars
| June 30, 2014 | December 31, 2013 | ||||
| Assets | |||||
| Current assets: | |||||
| Cash and cash equivalents | $ | 20,063 | $ | 33,690 | |
| Accounts receivable | 1,765 | 951 | |||
| Inventories | 9,405 | 8,638 | |||
| Derivative assets | - | - | |||
| Prepayments and other assets | 189 | 193 | |||
| 31,422 | 43,472 | ||||
| Exploration and evaluation assets | 46,501 | 38,390 | |||
| Producing properties | 42,570 | 49,751 | |||
| Plant and equipment | 47,811 | 49,025 | |||
| Reclamation deposits | 8,406 | 8,373 | |||
| Restricted cash | 1,695 | 1,695 | |||
| Deferred tax assets | 20,728 | 20,228 | |||
| Other assets | 252 | 136 | |||
| $ | 199,385 | $ | 211,070 | ||
| Liabilities and Shareholders' Equity | |||||
| Current liabilities: | |||||
| Accounts payable and other liabilities | $ | 10,653 | $ | 9,793 | |
| Employee-related liabilities | 4,546 | 5,241 | |||
| Royalties payable | 1,002 | 956 | |||
| Provisions | - | 777 | |||
| Derivative liabilities | 85 | 1,105 | |||
| Current portion of long-term debt | 2,791 | 11,754 | |||
| 19,077 | 29,626 | ||||
| Long-term debt | 2,409 | 3,295 | |||
| Asset retirement obligations | 12,341 | 12,023 | |||
| Deferred tax liabilities | 2,414 | 2,330 | |||
| 36,241 | 47,274 | ||||
| Shareholders' equity: | |||||
| Share capital | 98,575 | 98,575 | |||
| Contributed surplus | 20,712 | 20,317 | |||
| Stock options | 4,254 | 4,267 | |||
| Retained earnings | 39,525 | 40,778 | |||
| Accumulated other comprehensive loss | 78 | (141) | |||
| 163,144 | 163,796 | ||||
| $ | 199,385 | $ | 211,070 | ||
SOURCE: St Andrew Goldfields Ltd.
about St Andrew Goldfields Ltd., please contact:
Tel: 1-800-463-5139 or (416) 815-9855; Fax: (416) 815-9437;
Website: www.sasgoldmines.com
Suzette N Ramcharan
Director, Investor Relations
Email: [email protected]
Duncan Middlemiss
President & CEO
Email: [email protected]
Ben Au
CFO, VP Finance & Administration
Email: [email protected]
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