Minto Metals generates record Adjusted EBITDA(1) in 2021 highlighting a 44% increase in production
WHITEHORSE, March 31, 2022 - Minto Metals Corp. ("Minto" or the "Company") today announced the Company's financial and operating results for the fourth quarter ("QTR 4 2021") and the Full Year results of 2021 ("YTD 2021"). The Full Year Results include a strong 44% growth in production and an increase of $27.6 million in Adjusted EBITDA(1) compared to 2020.
For complete details of the audited Consolidated Financial Statements and associated Management's Discussion and Analysis ("MD&A"), please refer to the Company's filings on SEDAR (www.sedar.com) or the Company's website (www.mintometals.com).
Fourth Quarter Highlights:
- Copper sales increased 109% to 8.4 million pounds compared to 4.0 million pounds in Quarter 4 2020.
- Revenue grew 160.8% to $47.3 million, a $29.2 million increase from $18.1 million in Quarter 4 2020.
- Improved operating result
-
- Mill Feed for Quarter 4 was 261,615 dry metric tonnes (dmt), a 58.6% increase from 164,969 dry metric tonnes (dmt) in Quarter 4 2020.
- Production costs increased 40.0% to $34.8 million compared to $24.9 million in Quarter 4 2020, consistent with operational ramp-up.
- Operating cash costs per pound sold (2) averaged USD $2.92/lb, a 35.0% decrease from USD $4.49/lb in Quarter 4 2020.
- All-In Sustaining Costs ("AISC") per pound sold (2) averaged USD $3.50/lb, a 33.5% decrease from USD $5.26/lb in Quarter 4 2020.
- Adjusted EBITDA totaled $13.1 million, a $20.4 million increase from loss of $7.3 million in Quarter 4 2020.
Full Year Highlights:
- Copper sales increased by 43.8% to 25.6 million pounds compared to 15.0 million pounds in 2020.
- Revenue grew 72.3% to $138.3 million, a $58.0 million increase from $80.3 million in 2020.
- Operating cash flow increased 72.2% to $12.2 million a $5.1 million increase from $7.1 million in 2020.
- Improved operating results
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- Mill Feed total for the year was 903,498 dry metric tonnes (dmt), a 43.6% improvement from 629,078 dry metric tonnes (dmt) in 2020
- Production costs increased 35.1% to $113.5 million compared to $84.0 million in 2020, consistent with the operational ramp-up.
- Operating cash costs per pound sold (2) averaged USD $3.19/lb, 9.6% lower than USD $3.53/lb in 2020, the result of increased maintenance expenses to improve operational performance.
- AISC per pound sold (2) averaged USD $3.87/lb, 6.5% lower than USD $4.14/lb in 2020.
- Adjusted EBITDA(1) totaled $22.2 million, a $27.6 million increase from a loss of $5.4 million in 2020.
- Total year-to-date Net Loss of $2.0 million, a 89.1% improvement from the $18.3 million net loss in 2020.
| 1. Refers to Adjusted Earnings before Interest, Taxes, Depreciation, and Amortization see "Alternative Performance Measures" on page 19 of the Company's 2021 Annual MD&A. 2. Refers to Cash Costs & All-In Sustaining Costs see "Alternative Performance Measures" on page 19 of the Company's 2021 Annual MD&A. |
"Our operation is showing positive momentum and is poised for an exciting step-change in 2022 thanks to the Yukon Government, the continued cooperation of the Selkirk First Nation and the employees and contractors at our Minto Mine located in central Yukon. Our investment to optimize and automate our process over the past 12 months will allow us to take advantage of the robust copper prices, positioning for growth in the future. Our Q4 2021 Adjusted EBITDA improved to $13.1 million dollars compared to a loss of $7.3 million dollar a year ago. The improved performance is extraordinary and a testament to the drive and passion to win shown by everyone who works here at Minto" said Chris Stewart, President & Chief Executive Officer of Minto Metals.
"From the mine's improved performance to the enhancements in our milling operation, we are pleased with the turnaround our team has accomplished in such a short period of time. I am excited about the future at Minto Metals and in particular the Minto Mine and look forward to building stronger relationships within the Selkirk First Nation and the Yukon regulatory agencies. We are focused on delivering great results and carrying the momentum from Q4 of 2021 into 2022 should serve us well!" Stewart added.
Outlook for 2022
Outlook
The following table summarises the production, cost, and capital expenditure outlook for 2022 which is consistent with the Company's guidance provided earlier in 2022. The plan is to operate the mill at an average throughput of 3,000 tonnes/day for the first half of 2022 and 3,250 tonnes/day for the second half of 2022 as the ore production continues to ramp up towards our mill's ultimate permitted capacity of 4,200 tonnes/day.
| Year Ended | ||||||||||
| Production Volumes | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |||||||
| Payable Copper (million pounds) | 27.0 - 31.0 | 25.6 | 17.8 | |||||||
| Gold (ounces) (1) | 11,000 - 12,100 | 11,783 | 8,419 | |||||||
| Silver (ounces) (1) | 140,000 - 150,000 | 135,354 | 74,076 | |||||||
| Production Costs | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |||||||
| Cash Costs ($USD/lb)(2) | $2.70 -$2.90 | $ | 3.19 | $ | 3.53 | |||||
| AISC ($USD/lb) (2) | $3.85 -$4.00 | $ | 3.87 | $ | 4.14 | |||||
| Exploration ($ millions) | $9.2 | $ | 3.6 | $ | - | |||||
| Sustaining Capital (2) | $27.0- $31.0 | $ | 6.3 | $ | 1.8 | |||||
| 1. 100% amounts. Under the agreement with Wheaton Precious Metals, the Company receives 75% of the value of gold shipments up to 11,000 ounces. Silver receipts are at the lesser of the prevailing market price and US $4.35/oz. |
| 2. Refers to Cash Costs, All-In Sustaining Costs and Sustaining Capital. See "Alternative Performance Measures" on page 19 of the Company's 2021 Annual MD&A. |
2021 Financial Highlights
Adjusted EBITDA(1) Reconciliation to Net Income
| Q4 2021 | Q4 2020 | 2021 | 2020 | 2019 | ||||||
| Net income (loss) and comprehensive income (loss) | $ | 4,080 | $ | (9,498) | $ | (1,970) | $ | (18,281) | $ | (28,484) |
| Finance costs | 1,338 | 1,345 | 4,973 | 4,849 | 4,011 | |||||
| Depletion and amortization | 3,559 | 1,392 | 11,240 | 8,097 | 2,568 | |||||
| Income tax expense | 295 | 92 | 439 | 143 | 245 | |||||
| EBITDA | $ | 9,272 | $ | (6,669) | $ | 14,682 | $ | (5,192) | $ | (21,660) |
| Share-based compensation expense | 3,110 | - | 3,110 | - | - | |||||
| Mark-to-market revenue adjustments | (2,421) | (1,044) | 288 | (836) | (2,723) | |||||
| Unrealized foregin exchange (gain) loss | (128) | 397 | (144) | 427 | 269 | |||||
| Impairment of equipment | 1,213 | - | 1,213 | - | - | |||||
| Loss on lease terminations | 9 | - | 201 | - | - | |||||
| Loss on forgiveness of loan | - | - | - | - | 15,867 | |||||
| RTO Financing expenses | 1,065 | - | 1,948 | 205 | - | |||||
| Listing expense | 948 | - | 948 | - | - | |||||
| Adjusted EBITDA | $ | 13,068 | $ | (7,316) | $ | 22,246 | $ | (5,396) | $ | (8,247) |
| 1. Refers to Adjusted Earnings before Interest, Taxes, Depreciation, and Amortization see "Alternative Performance Measures" on page 19 of the Company's 2021 Annual MD&A for more information. |
2021 Consolidated Statements of Loss and Comprehensive Loss
| Twelve months ended | ||||
| December 31, 2021 | December 31, 2020 | |||
| Revenue | $ | 138,297 | $ | 80,251 |
| Production costs | (113,510) | (83,959) | ||
| Royalty expense | (1,496) | (928) | ||
| Depletion and amortization | (11,240) | (8,097) | ||
| Income (loss) from mine operations | 12,051 | (12,733) | ||
| Expenses | ||||
| Related party management fees | (888) | (771) | ||
| Stock-based compensation expense | (3,110) | - | ||
| Other expenses | (2,896) | (205) | ||
| Income (loss) from operations | 5,157 | (13,709) | ||
| Other income (loss), net | (1,715) | 420 | ||
| Finance costs | (4,973) | (4,849) | ||
| Loss before income taxes | (1,531) | (18,138) | ||
| Income tax expense | (439) | (143) | ||
| Net loss and comprehensive loss | $ | (1,970) | $ | (18,281) |
| Per share amounts | ||||
| Basic and diluted | $ | (0.03) | $ | (0.45) |
| Weighted Average Number of Common Shares Outstanding | 61,539,216 | 40,439,144 | ||
2021 Consolidated Statements of Financial Position
| As at | December 31, 2021 | December 31, 2020 | ||
| Assets | ||||
| Current assets | ||||
| Cash | $ | 9,979 | $ | 507 |
| Accounts Receivable | 20,762 | 6,437 | ||
| Inventories | 6,212 | 5,604 | ||
| Prepaid expenses | 2,855 | 755 | ||
| 39,808 | 13,303 | |||
| Non-current assets | ||||
| Mineral properties, plant and equipment | 53,702 | 48,594 | ||
| Right-of-use assets | 9,245 | 10,433 | ||
| Long-term deposits | 13,399 | 8,988 | ||
| Total assets | $ | 116,154 | $ | 81,318 |
| Liabilities | ||||
| Current liabilities | ||||
| Accounts payable and accrued liabilities | $ | 36,370 | $ | 20,937 |
| Current portion of Sumitomo loan | 10,221 | 2,012 | ||
| Current portion of Due to Pembridge | 4,000 | - | ||
| Current portion of lease liability | 5,436 | 6,065 | ||
| 56,027 | 29,014 | |||
| Non-current liabilities | ||||
| Lease liabilities | 3,895 | 3,610 | ||
| Due to Pembridge | 1,174 | 4,841 | ||
| Note payable to Pembridge | 6,368 | - | ||
| Due to Sumitomo | - | 1,732 | ||
| Long-term debt | 11,702 | 11,347 | ||
| Deferred revenue | 14,463 | 14,901 | ||
| Deferred income tax liabilities | 3,109 | 2,670 | ||
| Asset retirement obligation | 35,288 | 32,196 | ||
| Total liabilities | 132,026 | 100,311 | ||
| Shareholders' equity (deficiency) | ||||
| Share capital | 221,840 | 216,749 | ||
| Deficit | (237,712) | (235,742) | ||
| Total shareholders' equity (deficiency) | (15,872) | (18,993) | ||
| Total liabilities and shareholders' equity (deficiency) | $ | 116,154 | $ | 81,318 |
2021 Consolidated Statements of Cash Flows
| Twelve months ended | ||||
| December 31, 2021 | December 31, 2020 | |||
| Operating activities | ||||
| Net loss for the period | $ | (1,970) | $ | (18,281) |
| Adjustments for the following items: | ||||
| Depletion, depreciation and accretion | 11,240 | 8,097 | ||
| Finance costs | 4,973 | 4,849 | ||
| Other income (loss), net | 1,715 | 187 | ||
| Stock-based compensation expense | 3,110 | - | ||
| Listing expense | 948 | - | ||
| Amortization of deferred revenue | (1,548) | (2,084) | ||
| Income tax expense | 439 | 143 | ||
| Reclamation payments | (86) | - | ||
| Change in non-cash working capital | (4,989) | 15,896 | ||
| 13,832 | 8,807 | |||
| Interest paid | (1,642) | (1,728) | ||
| Net cash provided by operating activities | 12,190 | 7,079 | ||
| Investing activities | ||||
| Additions to mineral properties, plant and equipment | (6,302) | (6,573) | ||
| Right-of-use asset additions | (1,343) | - | ||
| Net cash used in investing activities | (7,645) | (6,573) | ||
| Financing activities | ||||
| Advances from Sumitomo | 11,958 | 3,798 | ||
| Repayments on Sumitomo loan | (5,501) | - | ||
| Repayment of lease liabilities | (7,426) | (7,406) | ||
| Share issuance | 31,033 | - | ||
| Share issuance costs | (1,674) | - | ||
| Class B common shares issued | - | 4,076 | ||
| Return of capital | (6,306) | - | ||
| Payment of Note Payable | (12,796) | - | ||
| Advances from Pembridge | - | 4,546 | ||
| Long-term deposits | (4,362) | (5,741) | ||
| Net cash provided by (used in) financing activities | 4,926 | (727) | ||
| Impact of foreign exchange on cash balances | 1 | (7) | ||
| Change in cash | 9,472 | (228) | ||
| Cash, beginning of year | 507 | 735 | ||
| Cash, end of year | $ | 9,979 | $ | 507 |
About Minto Metals Corp.
Minto operates the producing Minto mine located in the Minto Copper Belt, Yukon. The Minto mine has been in operation since 2007 with underground mining commencing in 2014. Since 2007, approximately 500Mlbs of copper have been produced from the Minto mine. The current mine operations are based on underground mining, a process plant to produce high-grade copper, gold, and silver concentrate, and all supporting infrastructure associated with a remote location in Yukon. The Minto property is located west of the Yukon River, about 20 km WNW of Minto Landing, the latter on the east side of the river, and approximately 250 road-km north of the City of Whitehorse, the capital city of Yukon.
Forward-Looking Information
This news release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking statements") within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates, and projections as of the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "anticipated" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might " or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward-looking statements relate, among other things, too (a) timing and listing of the Resulting Issuer Shares on the Exchange, (b) the use of proceeds from the RTO Financing, and (c) details with respect to the business of the Resulting Issuer. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors, which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; the delay or failure to receive board, shareholder, court or regulatory approvals; the supply and demand for labour and other project inputs; changes in commodity prices; changes in interest and currency exchange rates; risks relating to inaccurate geological and engineering assumptions; risks relating to unanticipated operational difficulties (including failure of equipment or processes to operate in accordance with specifications or expectations, cost escalation, unavailability of materials and equipment, government action or delays in the receipt of government approvals, industrial disturbances or other job action, and unanticipated events related to health, safety and environmental matters); risks relating to adverse weather conditions; political risk and social unrest; changes in general economic conditions or conditions in the financial markets; changes in laws; risks related to the direct and indirect impact of COVID-19 including, but not limited to, its impact on general economic conditions, and the ability to obtain financing as required; and other risk factors as detailed from time to time. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Except as required by law, the Resulting Issuer assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law. The statements in this news release are made as of the date of this release.
Contact Information:
For further information:
David J. Birch,
Chief Financial Officer
(416) 895-4824
E-mail: info@mintomine.com
Chris Stewart,
President & Chief Operating Officer
(647) 523-6618
SOURCE Minto Metals Corp.