Scorpio Announces Second Quarter 2010 Financial Results
16.08.2010 | CNW
NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE U.S.VANCOUVER, Aug. 16 /CNW/ - Scorpio Mining Corporation (TSX: SPM) ("Scorpio Mining" or the "Corporation") is pleased to announce its unaudited interim financial and operating results for the second quarter ended June 30, 2010.
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Three months Three months Six months Six months
ended ended ended ended
June 30, June 30, June 30, June 30,
2010 2009 2010 2009
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$ $ $ $
Revenue 6,464,264 4,650,139 12,486,205 6,904,035
Mine operating
earnings 980,173 1,100,429 2,289,257 1,996,025
Gain on dilution and
deconsolidation of
Scorpio Gold
Corporation 377,814 1,237,402 20,164,101 1,237,402
Net earnings (loss) (1,292,453) 433,910 17,325,374 36,791
Earnings per share
(loss) (0.01) 0.00 0.12 0.00
Adjusted EBITDA(1) 1,647,572 1,310,199 3,509,790 2,581,837
Cash operating cost
per tonne(2)(3) USD 50.11 44.55 43.25 40.98
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Peter J. Hawley, CEO reports, "The unexpected failure of one of the two ball mills at Nuestra Senora early in the quarter affected throughput and metal production targets for this quarter. The ball mill was repaired on July 8th, 2010 and the plant came back on line, with the July throughput target of 30,000 tonnes being exceeded, as 34,978 tonnes were processed. The Company expects the third quarter throughput target of 90,000 tonnes will be achieved, and the 2010 annual throughput and produced metals targets to be within reach. The Company congratulates the Mexico operations team on their hard work and the Company will continue to strive to make up the lost time on metal production".
This earnings release should be read in conjunction with the Corporation\'s MD&A, Financial Statements and Notes to Financial Statements for the period ended June 30, 2010, which are available on the Corporation\'s website at www.scorpiomining.com and have been posted on SEDAR at www.sedar.com.
HIGHLIGHTS FOR THE SECOND QUARTER AND SIX MONTHS ENDED JUNE 30, 2010
SECOND QUARTER
- Net loss was $1,292,453 compared to net earnings of $433,910 for the same period of 2009.
- Nuestra Senora mine operating earnings were $980,173 compared to $1,100,429 for the same period of 2009.
- Adjusted EBITDA(1) was $1,647,572 compared to $1,310,199 for the same period of 2009.
- The average monthly mill throughput increased from 14,142 tonnes in Q2 2009 to 23,046 tonnes in Q2 2010, an increase of 163%. During Q2 of 2010, despite a ball mill failure, the Nuestra Senora mill processed 69,138 tonnes in 84 days of production, at an average grade of 0.96% lead, 0.36% copper, 2.22% zinc and 114 g/t silver.
- Contained metals produced in concentrates consisted of 924,000 pounds of lead, 375,000 pounds of copper, 2.860 million pounds of zinc and 187,496 ounces of silver.
- The Corporation acquired 100% of Platte River Gold Inc. through the issuance of 74,832,020 common shares. Its assets include three polymetallic deposits known as San Rafael, El Cajon and the 120 zone located approximately 10 kilometres from the Corporation\'s Nuestra Senora processing facility.
SIX MONTHS
- Due to the gain on dilution and deconsolidation of Scorpio Gold Corporation of $20,164,101, net earnings were $17,325,374 compared to net earnings of $36,791 for the same period of 2009.
- Nuestra Senora mine operating earnings were $2,289,257 for the six- month period ended June 30, 2010 compared to $1,996,025 for the same period of 2009.
- The Nuestra Senora mine processed 161,796 tonnes, compared to 82,021 tonnes for the same period in 2009.
- Adjusted EBITDA(1) was $3,509,790 compared to $2,581,837 for the same period of 2009.
(1) This is a non-GAAP performance measure. The following table provides a reconciliation of operation cash costs per tonne:
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2010 2009
Q2 H1 Q2(1) H1(1)
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Tonnes of ore milled 69,138 161,796 42,425 82,021
Cost of sales per
consolidated interim
financial statements
expressed in $CAD 4,119,213 7,084,727 2,923,825 3,656,106
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Cost of sales
expressed in $US 4,010,715 6,856,176 2,501,733 3,103,740
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Adjustments:
Concentrate inventory
write-down (116,293) (116,293) (9,415) (9,415)
Variation in inventory (287,443) 400,278 (789,982) (445,588)
Stock-based compensation (142,540) (142,540) - 48,361
Stockpile inventory
write-up - - 187,749 664,354
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Cash operating
costs $US 3,464,439 6,997,621 1,890,085 3,361,452
Cash operating costs
per ton $US 50.11 43.25 44.55 40.98
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(2) This is a non-GAAP performance measure. The following table provides a reconciliation of adjusted and standardized EBITDA to the second quarter of 2010 and the second quarter of 2009 financial statements:
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Three months Three months Six months Six months
ended ended ended ended
June 30, June 30, June 30, June 30,
2010 2009 2010 2009
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$ $ $ $
Net earnings (loss)
for the period (1,292,453) 433,910 17,325,374 36,791
Income taxes 141,890 - 845,544 51,658
Interest expense 504,771 478,994 1,012,531 961,333
Depletion and
amortization of
mineral properties,
plant and equipment 1,388,794 798,308 3,152,500 1,593,066
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Standardized EBITDA 743,002 1,711,212 22,335,949 2,642,848
Stock-based
compensation 1,282,384 836,389 1,337,942 1,176,391
Gain on dilution and
deconsolidation of
Scorpio Gold
Corporation (377,814) (1,237,402) (20,164,101) (1,237,402)
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Adjusted EBITDA 1,647,572 1,310,199 3,509,790 2,581,837
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(3) Cash operating cost per ton for prior periods has been restated from what was previously disclosed by the Corporation. Management found errors in the calculation of this information due to the miscalculated impact of depreciation included in inventory as well as reversal of concentrate inventory write-down within periods.
Further information is available on the Corporation\'s web site at: http://www.scorpiomining.com. President, Mr. D. Roger Scammell, PGeo, is the Corporation\'s Qualified Person for the Nuestra Senora project and has reviewed the content of this release.
ON BEHALF OF SCORPIO MINING CORPORATION
Peter J. Hawley
CEO & Director
This news release includes certain statements that may be deemed "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to production and throughput targets, enhancing mine operations, completing acquisitions and Scorpio Mining Corporation\'s commitment to, and plans for developing the Nuestra Senora Project. Generally, these forward-looking statements can be identified by the forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "projects", "intends", "anticipates", or "does not anticipate", or "believes", or "variations of such words and phrases or state that certain actions, events or results "may", "can", "could", "would", "might", or "will" be taken", "occur" or "be achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Scorpio Mining Corporation to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the exploration and development and operation of the Nuestra Senora Project, risks related to international operations, construction delays and cost overruns, equipment breakdowns, the actual results of current exploration, development and construction activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, future prices of silver, zinc, copper, lead and gold, risks relating to completing acquisition transactions as well as those factors discussed in the sections relating to risk factors of our business filed in Scorpio Mining Corporation\'s required securities filings on SEDAR, including its Annual Information Form dated March 29, 2010. Although Scorpio Mining Corporation has attempted to identify important factors that could cause results to differ materially from those contained in forward-looking statements, there may be other factors that cause results to be materially different from those anticipated, described, estimated, assessed or intended.
There can be no assurance that any forward-looking statements will prove accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Scorpio Mining Corporation does not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws.
For further information:
Rich Kaiser, YES International
1-800-631-8127, 001-757-306-6090 (outside North America)
Email: yes@yesinternational.com
http://www.scorpiomining.com