Anaconda Mining reports results for fiscal first quarter of 2012; Generates net income of $207,000 at Canadian operations
TORONTO, Nov. 15, 2011 /CNW/ - Anaconda Mining Inc. ('Anaconda' or the 'Company') -
is pleased to report its results for the three months ended August 31, 2011. On a segmented basis, the Canadian operations (Pine Cove and corporate) produced net income of approximately $207,000. Earnings before interest, taxes, depreciation, amortization and non-cash share-based compensation ('EBITDA') totaled approximately $1.05 million for the Canadian operations.On a consolidated basis, the Company generated a net loss for the first quarter ended August 31, 2011 of approximately $811,000 (or $0.005 per basic and fully diluted share). The consolidated net loss was due to the Chilean operations, which lost $1,018,000. The Chilean operations incurred a one-time, non-cash expense of $880,205 related to exploration expenditures for the Company's San Gabriel project. These costs were paid by Anaconda's joint venture partner pursuant to the sale of 50% of the project last fiscal year.
All amounts are in Canadian dollars unless stated otherwise. The financial results and Management's Discussion and Analysis of these results may be found on Anaconda's website (www.anacondamining.com) and on its SEDAR profile (www.sedar.com).
Anaconda President and CEO, Dustin Angelo, stated, 'The results from the first quarter demonstrate the cash flow generation potential of the Pine Cove mine and the Company's overall ability to be profitable. We expect the mill modifications, initiated during the end of September and the first half of October, to push overall mechanical availability and gold recovery levels higher than what the mine achieved during the first quarter. Since completing the mill modifications, we've made substantial progress toward reaching normal operating levels. We expect to realize the full benefit of our capital investment in the mill beginning in December, at the start of the fiscal third quarter.'
FINANCIAL OVERVIEW
-- Precious metals sales for the first quarter ended August 31,
2011 were $4.5 million and costs of goods sold were
approximately $2.8 million for a gross margin of nearly $1.7
million (38% of revenue).
-- Administrative expenses for the 3-month period ended August 31,
2011 were $1.2 million, of which approximately $669,000
pertained to depletion, depreciation and share-based
compensation.
-- As at August 31, 2011, Anaconda had cash and cash equivalents
of $1,108,192, of which $677,499 was restricted mainly for
letters-of-credit guarantees regarding asset retirement
obligations of the Company regarding its Pine Cove site
development plan .
-- As at August 31, 2011, Anaconda had a working capital
deficiency of approximately $4.927 million. Anaconda utilized
the proceeds from its precious metals sales together with funds
from the completed private placement during the quarter to fund
its working capital and capital expenditure requirements.
-- Capital expenditures, primarily for mill equipment and tailings
dam construction, totaled $817,749 for the first quarter ended
August 31, 2011.
-- Nearly $87,000 was spent at Pine Cove on exploration at the
down dip extension.
OPERATIONAL HIGHLIGHTS
Pine Cove gold mine, Baie Verte, Newfoundland:
The Pine Cove mine continued to demonstrate improved operating and financial results during the first quarter ended August 31, 2011. Pine Cove sold 2,858 ounces of gold, generating approximately $4.5 million in revenue and over $1.5 million in EBITDA at an average gold sales price of $1,581 per ounce and total cash costs (before exploration expenses) of $1,012 per ounce. Sales volume and revenue exceeded the previous quarter (fourth quarter ended May 31, 2011) by 21% and 32%, respectively, while mine level EBITDA was nearly four times greater than the quarter ended May 31, 2011.
The following table summarizes by month the operating performance of the Pine Cove mill during the first quarter ended August 31, 2011:
________________________________________________________________
| |June '11|July '11|Aug '11|Total/Avg|
|____________________________|________|________|_______|_________|
|OPERATING STATISTICS: | | | | |
|____________________________|________|________|_______|_________|
|Calendar days | 30| 31| 31| 92|
|____________________________|________|________|_______|_________|
|Operating days | 28| 29| 26| 83|
|____________________________|________|________|_______|_________|
|Availability | 94%| 98%| 84%| 92%|
|____________________________|________|________|_______|_________|
|Dry tonnes processed | 27,650| 29,805| 22,480| 79,935|
|____________________________|________|________|_______|_________|
|Tonnes per 24-hour day | 980| 1,046| 864| 963|
|____________________________|________|________|_______|_________|
|Grade (grams per tonne) | 1.30| 1.52| 1.74| 1.51|
|____________________________|________|________|_______|_________|
|Overall mill recovery | 74%| 75%| 80%| 76%|
|____________________________|________|________|_______|_________|
| | | | | |
|____________________________|________|________|_______|_________|
|Gold sales volume (troy oz.)| 802| 1,075| 981| 2,858|
|____________________________|________|________|_______|_________|
Subsequent to the quarter-end, Anaconda received and installed the two, new drum filters it had ordered in May. In addition to the drum replacements, the operations and maintenance staff together with outside contractors made other operational changes and maintenance repairs including;
-- Modifications to the leach tanks, which included larger baffles
and up-comer piping.
-- Incorporation of a fourth, existing leach tank into the leach
circuit to allow for greater retention.
-- Fabrication and installation of a new pregnant solution tank
with internal baffles to help fines settling.
-- Replacement of liners and lifters in the primary grinding mill.
Corporate
-- On June 6, 2011, the Company announced that it had closed a
non-brokered private placement of 16,999,728 common shares at
$0.07 per share. The common shares were issued, in part, to
retire $1,049,981 of promissory notes including accrued
interest thereon, that were due at the end of June, 2011. The
remainder of the common shares issued generated gross cash
proceeds of approximately $140,000.
-- In addition, the Company issued on a non-brokered private
placement basis, 1,394,000 flow-through common shares issuable
pursuant to the private placement, raising additional proceeds
of $97,580.
ABOUT ANACONDA
Headquartered in Toronto, Canada, Anaconda is a mining and exploration company focused on operating the Pine Cove gold mine located on the Baie Verte Peninsula in Newfoundland, Canada and advancing the exploration and development of its iron ore portfolio in Chile with its joint venture partner, Inversiones SBX Limitada.
FORWARD LOOKING STATEMENTS
This document contains or refers to forward-looking information. Such forward-looking information includes, among other things, statements regarding targets, estimates and/or assumptions in respect of future production, mine development costs, unit costs, capital costs, timing of commencement of operations and future economic, market and other conditions, and is based on current expectations that involve a number of business risks and uncertainties. Factors that could cause actual results to differ materially from any forward-looking statement include, but are not limited to: the final approval of the private placement by the Toronto Stock Exchange; the grade and recovery of ore which is mined varying from estimates; capital and operating costs varying significantly from estimates; inflation; changes in exchange rates; fluctuations in commodity prices; delays in the development of the any project caused by unavailability of equipment, labour or supplies, climatic conditions or otherwise; termination or revision of any debt financing; failure to raise additional funds required to finance the completion of a project; and other factors. Additionally, forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as 'plans,' 'may,' 'estimates,' 'expects,' 'indicates,' 'targeting,' 'potential' and similar expressions. These forward-looking statements, including statements regarding Anaconda's beliefs in the potential mineralization, are based on current expectations and entail various risks and uncertainties. Forward-looking statements are subject to significant risks and uncertainties and other factors that could cause actual results to differ materially from expected results. Readers should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and we assume no responsibility to update them or revise them to reflect new events or circumstances, except as required by law.
Anaconda Mining Inc.
CONTACT:
Anaconda Mining Inc. Terre Partners
Dustin Angelo or Joanna Longo
President and CEO Investor Relations
(647) 260-1248 (416) 775-8771
Email: dangelo@anacondamining.com Email: jlongo@terrepartners.com
Company website: www.anacondamining.com