Iberian Minerals Reports 2011 Net Income of $173.7 Million
26.03.2012 | Marketwire
TORONTO, 03/26/12 - Iberian Minerals Corp. (TSX VENTURE: IZN) today announced financial and operating results for the year ended December 31, 2011, with comparative figures for the year ended December 31, 2010. The audited consolidated financial statements and related notes, and Management Discussion and Analysis may be found on www.sedar.com. Unless stated otherwise, all reported figures are in U.S. dollars. The Company reported net income of $173.7 million for 2011, representing $0.42 per share.Financial:
Year ended December 31, 2011
- Recorded net income of $173.65 million or $0.42 per registered share whic included:
-- Sales of $245.32 million and gross loss of $77.03 million;
-- A realized loss of $206.62 million on commodity hedges (included in sales) which caused the gross loss;
-- An unrealized non-cash gain of $302.97 million on derivative financial instruments outstanding, partially as a result of commodity hedging positions in copper and zinc that were delivered into during the year and were thus retired and partially due to a decline in metals prices impacting the fair value of outstanding hedge positions.
- Cash flow provided by operations was $29.04 million.
- In June 2011 the Company completed a CA$76 million equity financing which allowed for the buy-out of Trafigura's 45.96% net-profit interest ("NPI") in Condestable (for 2011 to 2014) for $60 million. The buy-out of the NPI was completed on June 30, 2011.
Three months ended December 31, 2011
- Recorded net loss of $27.90 million or $0.06 per registered share which included:
-- Sales of $61.84 million and gross loss of $23.01 million;
-- A realized loss of $35.60 million on commodity hedges (included in sales) which caused the gross loss;
-- An unrealized non-cash gain of $10.32 million on derivative financial instruments outstanding, partially as a result of commodity hedging positions in copper and zinc that were delivered into during the period and were thus retired and partially due to a decline in metals prices impacting the fair value of outstanding hedge positions.
Operational - CMC:
Year ended December 31, 2011
- The average copper ore grade for Condestable was 1.06% in 2011 versus 1.16% in 2010.
- CMC processed 2,364,034 tonnes of ore in 2011 versus 2,234,498 tonnes of ore in 2010 (increase of 6%).
- Copper concentrate production in 2011 was 94,412 DMT versus 92,264 DMT in 2010 (increase of 2%).
- Contained copper production in 2011 was 22,572 tonnes versus 23,153 tonnes in the prior year.
- The Cash Operating Cost (non-IFRS measure; refer to section 5) in 2011 was $1.21 per payable pound of copper versus prior year of $1.04.
Three months ended December 31, 2011
- Copper ore grade was 0.96% versus 1.16% in the fourth quarter of 2010.
- CMC processed 594,867 tonnes of ore in the period versus 567,566 tonnes for the same period of the prior year (increase of 5%).
- Copper concentrate production in the period was 21,945 DMT versus 23,383 DMT in the prior year period.
- Contained copper production in the period was 5,176 tonnes versus 5,891 tonnes in the prior year period.
- The Cash Operating Cost for the period was $1.49 per payable pound of copper versus prior year of $1.08.
Other
- In May 2011 completed an amendment to its senior debt facility and increased the principal to $60 million and extended the term by six months
(to September 2013).
- Major project works were completed on the previously announced processing plant expansion. The processing plant capacity reached 7,000 tpd of ore processed at the end of 2011.
- In December 2011 CMC signed a new collective labour agreement through to October 2014. Detailed in the new collective agreement are terms and conditions reflecting current labor norms with some extended benefits and salary increases in each year of the agreement.
Operational - MATSA:
Year ended December 31, 2011
- MATSA processed 2,031,044 tonnes of ores in 2010; 1,160,978 copper and 870,066 polymetallic. This was an increase of 21% over the 1,681,140 tonnes of ores processed in 2010.
- Produced 114,533 DMT of copper concentrate (2010 - 88,999 DMT), 69,266 DMT of zinc concentrate (2010 - 36,196 DMT), and 30,669 DMT of lead concentrate (2010 - 1,179 DMT). Contained metal production was 25,883 tonnes of copper (2010 - 20,351 tonnes), 33,197 tonnes of zinc (2010 - 17,323 tonnes), 5,705 tonnes of lead (2010 - 229 tonnes) and 961,975 oz of silver (2010 - 655,319 oz).
- The Cash Operating Cost was $1.60 per payable pound of copper (2010 - $2.22 per payable pound of copper). Cash Operating Cost was substantially reduced in 2011 due to the combined effect of higher payable copper production, higher by-product metal production and lower actual operating costs realized.
Three months ended December 31, 2011
- MATSA processed 531,834 tonnes of ore in the period versus 480,789 during the fourth quarter of 2010 (increase of 11%).
- Produced 30,118 DMT of copper concentrate (2010 - 22,295 DMT), 18,373 DMT of zinc concentrate (2010 - 15,105 DMT) and 7,144 DMT of lead concentrate (2010 - 1,179 DMT). Contained metal production was 6,888 tonnes of copper (2010 - 4,933 tonnes), 8,796 tonnes of zinc (2010 - 7,209 tonnes), 1,490 tonnes of lead (2010 - 229 tonnes) and 240,328 ounces of silver (2010 - 151,051 ounces).
- The Cash Operating Cost was $1.39 per payable pound of copper (2010 - $2.11 per payable pound of copper). Cash Operating Cost was substantially reduced in 2011 due to the combined effect of higher payable copper production, higher by-product metal production and lower actual operating costs realized.
Other
- In May 2011 MATSA was awarded the exploration concessions by the local authorities for the Sotiel property, located approximately 25 km from the Aguas Tenidas Mine. The Sotiel mine, which forms part of the concessions,
was a past producing mine and is located approximately 30 km from the Aguas Tenidas operation.
- In February 2012 MATSA signed a new collective labour agreement with its unionized workers. The new agreement expires in December 2015. Th agreement includes salary increases tied to the Spanish inflationary index.
Summarized Financial Results
The following table presents a summarized Statement of Operations for the periods ended December 31, 2011 with comparatives for the periods ended December 31, 2010.
Years ended December Three months ended
31, December 31,
----------------------------------------------------------------------------
(thousands of U.S. Dollars) 2011 2010 2011 2010
----------------------------------------------------------------------------
$ $ $ $
Sales 245,321 226,723 61,839 61,747
Costs and expenses of mining
operations 322,348 303,423 84,849 79,849
----------------------------------------------------------------------------
Gross loss (77,027) (76,700) (23,010) (18,102)
Expenses
Administrative expenses and
other 8,128 3,681 3,181 400
Exploration and evaluation
expenditures 11,796 - 6,980 -
Foreign exchange gain (2,404) (5,560) (797) 834
Contingent consideration fair
value - 5,233 - 0
Unrealized (gain) loss on
derivative instruments (302,973) 40,964 (10,317) 62,057
----------------------------------------------------------------------------
(285,453) 44,318 (953) 63,291
Operating income (loss) 208,426 (121,018) (22,057) (81,393)
Net finance costs 17,800 20,886 14,017 16,100
----------------------------------------------------------------------------
Income (loss) before taxation 190,626 (141,904) (36,074) (97,493)
Current income tax expense 4,095 7,474 3,945 1,863
Deferred income tax expense
(recovery) 12,880 (35,676) (12,123) (39,472)
----------------------------------------------------------------------------
Net income (loss) 173,651 (113,702) (27,896) (59,884)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Basic earnings (loss) per share
($) 0.42 (0.33) (0.06) (0.18)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Key operating statistics
CMC:
----------------------------------------------------------------------------
Fourth quarter Year
Periods ended December
31, Unit 2011 2010 2011 2010
----------------------------------------------------------------------------
Ore mined t 567,177 563,034 2,354,670 2,217,413
Ore processed t 594,867 567,566 2,364,034 2,234,498
Copper ore grade % 0.96 1.16 1.06 1.16
Concentrate grade % 24 25 24 25
Copper recovery rate % 90 90 90 89
Copper concentrate DMT 21,945 23,383 94,412 92,264
Copper contained in
concentrate FMT 5,176 5,891 22,572 23,153
Gold contained in
concentrate oz 3,269 3,214 13,850 13,881
Silver contained in
concentrate oz 76,291 82,950 317,081 291,000
Payable copper
contained in
concentrate FMT 4,932 5,628 21,520 22,119
Payable gold contained
in concentrate oz 2,960 2,911 12,540 12,249
Payable silver
contained in
concentrate oz 68,318 74,281 283,946 265,617
----------------------------------------------------------------------------
Cash Operating Cost per
lb of payable copper USD $ 1.49 $ 1.08 $ 1.21 $ 1.04
----------------------------------------------------------------------------
MATSA:
----------------------------------------------------------------------------
Three months Year
Periods ended December
31, Unit 2011 2010 2011 2010
----------------------------------------------------------------------------
Copper ore
-----------------------
Ore mined t 303,430 287,588 1,175,613 1,215,224
Ore processed t 293,634 252,597 1,160,977 1,173,152
Copper ore grade % 2.22 1.95 2.21 1.86
Concentrate grade % 23 22 22 22
Copper recovery rate % 86 81 85 83
Copper concentrate DMT 24,337 18,017 97,547 80,539
Copper contained in
concentrate FMT 5,516 3,988 21,931 17,888
Silver contained in
concentrate oz 66,704 53,571 283,926 249,384
Payable copper
contained in
concentrate FMT 5,272 3,808 20,956 17,083
Payable silver
contained in
concentrate oz 43,231 36,193 189,840 171,702
Polymetallic ore
-----------------------
Ore mined t 250,117 223,674 894,008 505,071
Ore processed t 238,200 228,189 870,066 507,988
Zinc ore grade % 5.34 5.09 5.61 5.71
Zinc concentrate grade % 48 48 48 48
Zinc recovery rate % 69 64 68 63
Copper ore grade % 1.06 1.17 1.09 1.23
Copper concentrate
grade % 24 22 23 22
Copper recovery rate % 54 36 42 37
Lead ore grade % 1.57 - 1.66 -
Lead concentrate grade % 21 - 19 -
Lead recovery rate % 40 - 40 -
Zinc concentrate DMT 18,373 15,105 69,266 36,196
Copper concentrate DMT 5,781 4,278 16,986 8,460
Copper/lead concentrate DMT - - - 6,071
Lead concentrate DMT 7,144 1,179 30,669 1,179
Zinc contained in
concentrate FMT 8,796 7,209 33,197 17,323
Copper contained in
concentrate FMT 1,372 945 3,952 2,463
Lead contained in
concentrate FMT 1,490 229 5,705 229
Silver contained in
concentrate oz 173,624 97,480 678,049 405,935
Payable zinc contained
in concentrate FMT 7,327 6,000 27,655 14,427
Payable copper
contained in
concentrate FMT 1,314 903 3,782 2,318
Payable lead contained
in concentrate FMT 1,275 176 4,785 176
Payable silver
contained in
concentrate oz 103,413 67,900 411,484 289,655
----------------------------------------------------------------------------
Cash Operating Cost per
lb of payable copper USD 1.39 2.11 1.60 2.22
----------------------------------------------------------------------------
About Iberian Minerals Corp.
Iberian Minerals Corp. is a Canadian listed global base metals company with interests in Spain and Peru. The Condestable Mine, located in Peru approximately 90 km south of Lima operates at 2.4 million tonnes per year producing copper, and associated silver and gold in a concentrate. The Aguas Tenidas Mine is in the Andalucia region of Spain approximately 110 km north-west of Seville and operates a 2.2 million tonnes per year underground mine and concentrator that produces copper, zinc and lead concentrates that also contain gold and silver.
Note 1 - The Cash Operating Cost per pound of payable copper is a non-IFRS performance measure. It includes cash operating costs, including treatment and refining charges ("TC/RC"), freight and distribution costs, and is net of by-product metal credits (zinc, gold and silver). The Cash Operating Cost per pound of payable copper indicator is consistent with the widely accepted industry standard established by Brook Hunt and is also known as the C1 cash cost.
FORWARD LOOKING STATEMENTS:
This news release contains certain "forward-looking statements" and "forward-looking information" under applicable securities laws. Except for statements of historical fact, certain information contained herein constitutes forward-looking statements. Forward-looking statements are frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward looking information may include, but is not limited to, statements with respect to the future financial or operating performances of the Corporation, its subsidiaries and their respective projects, the timing and amount of estimated future production, estimated costs of future production, capital, operating and exploration expenditures, the future price of copper, gold and zinc, the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the costs and timing of future exploration, requirements for additional capital, government regulation of exploration, development and mining operations, environmental risks, reclamation and rehabilitation expenses, title disputes or claims, and limitations of insurance coverage. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are based on a number of assumptions and subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Many of these assumptions are based on factors and events that are not within the control of the Corporation and there is no assurance they will prove to be correct. Factors that could cause actual results to vary materially from results anticipated by such forward-looking statements include changes in market conditions and other risk factors discussed or referred to in the section entitled "Risk Factors" in the Corporation's annual information form dated March 29, 2010. Although the Corporation has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The Corporation undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Iberian Minerals Corp.
Laura Sandilands, Investor Relations and Corporate Communications
416-815-8558