Toronto Stock Exchange
Ticker Symbol - ARZ
NYSE Amex
Ticker Symbol - AZK
U.S. Registration
(File 001-31893)
News Release
Issue # 12 - 2011
VANCOUVER, May 12 /PRNewswire-FirstCall/ - Aurizon reports
unaudited financial results for the first quarter of 2011, which
have been prepared on the basis of available information up to May
10, 2011. All dollar amounts are in Canadian dollars unless
otherwise stated. Our results are now being prepared in accordance
with International Financial Reporting Standards ("IFRS"). All
prior period information has been restated or reclassified for
comparative purposes in accordance with IFRS.
First Quarter 2011 Highlights and Significant Items
- Gross profit of $18.0 million, 43% higher than $12.6 million in
same quarter of 2010.
- Cash flow from operations of $14.5 million, 58% higher than
$9.2 million in same quarter of 2010.
- Operating profit margin per ounce(1) increased 63%
to US$771, due to higher realized gold prices.
- Gold production of 31,976 ounces.
- Profit of $2.4 million, or $0.02 per share, matching same
period of 2010.
- Working capital of $152 million, including cash of $143
million.
- Establishment of US$50 million revolving credit facility.
"We continued to generate strong cash flow, fund aggressive
exploration programs, and improve our financial capacity in the
first quarter despite operational issues at Casa Berardi." said
David Hall, President and Chief Executive Officer. "As previously
indicated the Casa Berardi mine plan had projected that the first
quarter would be the weakest in terms of throughput, grade and
ounces produced. We anticipate that operational and financial
performance will strengthen going forward, particularly in the
second half of the year. We have been very active on exploration at
Casa Berardi, Joanna, Marban and Fayolle with encouraging results.
We look forward to commencing our summer exploration programs at
Rex South, Opinaca, Wildcat and Duverny during the second quarter
of this year."
FINANCIAL RESULTS
Financial review of the first quarter 2011
Profit of $2.4 million, or $0.02 per share, was achieved
in the first quarter of 2011, matching profit of $2.4 million, or
$0.02 per share, in the same period of 2010. Results were
positively impacted by rising operating profit margins and offset
by the significant increase in exploration activities at Aurizon's
exploration properties, together with continued exploration and
feasibility work at Joanna. In addition, the comparative
first quarter results in 2010 were positively impacted by non-cash
derivative gains totalling $3.4 million.
Revenue from Casa Berardi operations increased 19% to
$47.2 million in the first quarter of 2011 from the sale of 34,306
ounces of gold, compared to $39.8 million from the sale of 34,423
ounces of gold in the same quarter of 2010. Net of realized
derivative losses, revenues in the first quarter of 2010 were $36.3
million. The average realized gold price was US$1,392 per
ounce and the average Cad/US exchange rate was 0.98, compared to
realized prices of US$1,010 per ounce at an average exchange rate
of 1.04 in the same quarter of 2010.
__________________________
1 See "Non-GAAP" measures on page 6.
During the first quarter of 2011, 100% of gold sales were made
at current market prices. In the same quarter of 2010, 68% of
the gold sales were delivered against gold call options at an
average price of US$903 per ounce. The average London p.m. gold fix
for the first quarter of 2011 was US$1,384 per ounce compared to
US$1,109 per ounce for the same period of 2010.
Cost of sales for the first quarter of 2011, comprising
operating costs and depreciation and amortization of $21.2 million
and $8.0 million respectively totalled $29.2 million. On a
unit cost basis (2), total cash costs per
ounce of gold sold were US$621 and depreciation and amortization
was US$238 per ounce, for a total production cost of US$859 per
ounce.
Gross profit of $18.0 million in the first quarter of
2011 increased significantly from $12.6 million for the same period
of 2010. Rising gold prices and the elimination of gold
deliveries into call options at below market spot prices in the
first quarter of 2011 allowed operating profit
margins(2) to increase to US$771 per ounce compared to
US$472 per ounce in the same quarter of 2010.
Exploration expenditures in the first quarter of 2011
rose to $7.1 million from $2.0 million in the same period of 2010.
This is attributable to the seven new exploration properties
acquired in 2010 together with continued exploration and
feasibility work at Joanna.
General and administrative costs in the first
quarter of 2011 totalled $6.1 million compared to $5.2 million for
the same period of 2010. Included in these costs are non-cash
stock based compensation charges totalling $1.4 million compared to
$3.0 million in the same period of 2010. Also included in the
first quarter 2011 administrative and general costs is a charge of
$1.6 million representing the fair value of estimated employee
incentive payments to be paid out in the future.
Income and resource taxes totalled $2.5 million down from
$3.5 million for the same period of 2010 as a result of lower
federal tax rates and fewer non-deductible costs in the first
quarter of 2011. In addition, in the first quarter of 2010,
certain gold sales were delivered against call options at below
market spot prices, whereas the provincial resource tax is assessed
using market commodity prices, thereby resulting in a higher
effective tax rate for that period.
Cash flow from operating activities increased in the
first quarter of 2011 to $14.5 million, compared to cash flow of
$9.2 million in the same period of 2010. The increase in cash
flow from a year ago is principally due to higher realized gold
prices, partially mitigated by higher exploration expenditures.
Investing activities totalled $11.0 million in the first
quarter of 2011 compared to $8.9 million for the same period of
2010. Capital expenditures at Casa Berardi totalled $10.3
million in the first quarter of 2011, of which $7.0 million was on
sustaining capital and development, and $3.3 million was on
exploration activity.
Financing activities during the first quarter of 2011
included the establishment of a US$50 million revolving credit
facility. The costs associated with establishing this
facility were $0.5 million. In addition, $0.4 million was
realized from incentive stock option exercises, resulting in a net
cash outflow of $0.1 million in the first quarter 2011.
__________________________
2 See "Non-GAAP" measures on page 6.
Balance Sheet
As at March 31, 2011, cash and cash equivalents increased to
$142.8 million, compared to $139.3 million as at December 31,
2010. Working capital remained unchanged at $152
million.
Credit Facility
On January 31, 2011, Aurizon established a US$50 million
revolving credit facility with Canadian Imperial Bank of Commerce
and The Bank of Nova Scotia. The revolving credit facility
has an initial three year term and is secured by a charge over the
assets of Aurizon. Funds drawn on the facility may be used to
finance working capital requirements, acquisitions, and for general
corporate purposes. There are no hedging requirements under
the terms of the credit facility.
Casa Berardi
| |
| Summary of Key
Operational Statistics |
| |
|
2011 |
2010 |
| |
|
Q1 |
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
| Operating results |
|
|
|
|
|
|
|
|
|
|
| Tonnes milled |
|
161,036 |
|
178,648 |
|
182,487 |
|
169,913 |
|
191,697 |
| Grade - grams/tonne |
|
6.85 |
|
6.79 |
|
7.20 |
|
6.15 |
|
6.86 |
| Mill recoveries - % |
|
90.2% |
|
90.2% |
|
91.2% |
|
89.1% |
|
88.6% |
| Gold production - ozs |
|
31,976 |
|
35,188 |
|
38,527 |
|
29,905 |
|
37,496 |
| Gold sold - ozs |
|
34,306 |
|
34,423 |
|
39,964 |
|
30,755 |
|
34,808 |
| Per ounce data -
US$(3) |
|
|
|
|
|
|
|
|
|
|
| Average realized gold price (i) |
|
$1,392 |
|
$1,010 |
|
$1,082 |
|
$1,119 |
|
$1,376 |
| Total cash costs (ii) |
|
$621 |
|
$538 |
|
$504 |
|
$604 |
|
$531 |
| Amortization (iii) |
|
238 |
|
228 |
|
240 |
|
254 |
|
263 |
| Total production costs (iv) |
|
$859 |
|
$766 |
|
$744 |
|
$858 |
|
$794 |
| Table
footnotes: |
| (i) |
Realized gold prices net of realized
derivative gains or losses divided by ounces sold. |
| (ii) |
Operating costs net of by-product
credits, divided by ounces sold, and divided by the average Bank of
Canada Cad$/US$ rate. |
| (iii) |
Depreciation and amortization
charges. |
| (iv) |
Total cash costs plus depreciation
and amortization charges. |
Gold production from the Casa Berardi mine in the first quarter
of 2011 totalled 31,976 ounces, 12% lower than plan and 9% lower
than the first quarter 2010 production of 35,188 ounces.
Changes to the mining sequence were required in the first quarter
of 2011 due to ground conditions, particularly in one stope in the
eastern sector of Zone 113. This impacted both ore throughput
and ore grades. Additionally, underground mining equipment
downtime impacted productivities in the first quarter of
2011. The 2011 capital budget provided for equipment
replacements, which are scheduled to be delivered over the course
of the year.
Lower daily ore throughput of 1,789 tonnes per day in the first
quarter 2011 compared to 1,985 tonnes per day in the same quarter
of 2010 was the principal factor for the lower gold production in
2011, as ore grades and metallurgical recoveries were similar in
both quarters. Unit operating costs(3) on a
Canadian dollar per tonne basis in the first quarter of 2011 were
4% higher than plan at $129 per tonne, as a result of changes to
the mining sequence and lower equipment availability impacting ore
throughput. Unit operating costs(3) in the same
quarter of 2010 were $108 per tonne.
__________________________
3 See "Non-GAAP" measures on page 6.
The anticipated higher unit operating costs on a per tonne basis
in 2011, together with a strong Canadian dollar, resulted in total
cash costs of US$621 per ounce in the first quarter of 2011,
compared to US$538 in the same quarter of 2010. A combination
of a 19% increase in unit operating costs together with a 5%
strengthening of the Canadian dollar resulted in the higher total
cash costs per ounce compared to the same quarter of 2010.
Rising gold prices and the elimination of deliveries against
call options at below market spot prices which were required in the
first quarter of 2010 has allowed operating profit
margins(4) to increase to US$771 per ounce
compared to US$472 per ounce in the same quarter of 2010.
Higher ore throughput and grades are anticipated for the balance
of 2011, which is expected to result in lower total cash costs per
ounce than those realized in the first quarter of 2011.
__________________________
4 See "Non-GAAP" measures on page 6.
Casa Berardi Shaft Deepening
In the first quarter of 2011, a contract was awarded for the
deepening of the West Mine production shaft from the 760 metre
level down to the 1,080 metre level. Shaft deepening is
expected to commence in the second quarter and be completed toward
the end of 2012. The shaft will provide access to the lower
portion of Zones 113, 118, and 123 from a drift at the 1,010 metre
level. The estimated cost of the shaft deepening, drift access to
Zones 118 and 123, and related infrastructure is approximately $32
million of which $13.6 million is budgeted for 2011.
Casa Berardi Exploration
Three surface rigs and eight to nine underground drill rigs were
active at Casa Berardi during the quarter. The surface drill
rigs were primarily active exploring Zone 160 near the East mine
mill facilities where there may be an opportunity to establish an
open pit operation. The underground drill rigs were primarily
focused on infill and step out drilling of the upper extensions of
Zones 118 and 123 from the 550 level drift as well as depth
extensions of Zones 118 and 120.
OTHER PROPERTIES
Joanna Gold Development Property
Metallurgical test-work continued during the first quarter to
evaluate and optimize alternate metallurgical processes to treat
the Hosco ore with final results expected in the second
quarter.
Four to five drill rigs were active in the first quarter
completing 24,100 metres of drilling in proximity to the proposed
Hosco pit and the Heva deposit, approximately 3 kilometres west of
the proposed Hosco pit. The drilling in the first quarter was split
between the two targets in order to extend the mineral resources
contour and to increase the quality of the existing indicated and
inferred mineral resources.
Fayolle Property
Three to four drill rigs were active in the first quarter
completing 16,600 metres of drilling that was divided between
continued exploration of the Fayolle deposit defining the size and
geometry of the deposit on a 25 - 50 metre drill spacing and
exploration of similar geological targets within the 2 kilometre
long gold bearing structure that crosses the property.
Marban Property
Two to three drill rigs were active in the first quarter
completing 15,100 metres of drilling focusing on the lateral and
depth extensions of the existing mineral resources. The
drilling to date has validated the geological and structural model
of the deposit; established lateral and vertical continuity to the
mineralized shear zones; and demonstrated the potential for both
bulk tonnage and narrower higher-grade ore shoots.
ADDITIONAL INFORMATION
Additional information about the Company's Casa Berardi Mine and
Joanna Gold Development projects as required by NI 43-101, sections
3.2 and 3.3 and paragraphs 3.4 (a), (c) and (d) can be found in the
Company's Annual Information Form for the year ended December 31,
2010, and the latest Technical Reports on each project, copies of
which can be found under Aurizon's profile on SEDAR at
www.sedar.com and are also available on the Company's website at
www.aurizon.com.
QUALIFIED PERSON AND QUALITY CONTROL
Information of a scientific or technical nature was prepared
under the supervision of Martin Bergeron, P. Eng., Vice-President
of Operations of Aurizon and a qualified person under National
Instrument 43-101.
OUTLOOK
Based upon lower than expected gold production in the first
quarter of 2011 and a review of the mine plan which anticipates
higher ore throughput for the balance of the year and higher ore
grades in the second half of the year, Casa Berardi production
guidance has been adjusted to approximately 165,000 ounces compared
to the previously announced guidance of 165,000 to 170,000 ounces.
The continued strength of the Canadian dollar together with the
higher total cash costs in the first quarter, has also resulted in
a revision to the forecast total cash costs in U.S. dollar terms of
US$525 per ounce for the full year, assuming a Canadian dollar
exchange rate of 0.96 against the U.S. dollar for the balance of
the year. This compares to previously forecasted total cash
costs of US$495 per ounce using a Cad/US$ exchange rate at
parity.
Onsite mining, milling and administration costs for 2011 are
expected to decrease from the $129 per tonne experienced in the
first quarter and average $117 per tonne, unchanged from previous
guidance, and up 8% from 2010 unit operating costs as a result of
reduced development ore, smaller stopes, and longer haulage
distances.
Capital expenditures at Casa Berardi are estimated to total
$51.1 million in 2011 ($7.0 million incurred in first quarter
2011), of which approximately 50% comprises expenditures that will
allow access to the lower portion of Zone 113 as well as the
recently discovered gold mineralization at depth in Zones 118 and
123, east of the West mine production shaft.
An additional $13.4 million will be invested on exploration at
Casa Berardi in 2011 ($3.3 million incurred in first quarter 2011)
which will include approximately 115,000 metres of surface and
underground diamond drilling. Up to 4 surface and 8
underground drill rigs will be active during the course of
2011. The Company expects to capitalize these costs as the
primary objective of the drilling will be to improve the quality of
the known reserves and resources as well as exploring for
extensions of these structures.
Feasibility study work on Joanna's Hosco open pit deposit
continues with completion of the study anticipated during the third
quarter 2011. Results from the step out drill program,
performed in 2010 and the first quarter of 2011, in the area of the
Hosco pit, will be incorporated into an updated mineral resource
estimate and block model for inclusion in the study. The
evaluation and optimization of alternate metallurgical processes to
treat the Hosco ore will be completed in the second quarter of
2011. The Company has budgeted $5.4 million for feasibility
study activities in 2011, of which $1.7 million was incurred in
first quarter 2011, and expects the majority of these costs to be
expensed.
In addition, an initial $3.7 million exploration program ($3.3
million incurred in first quarter 2011), comprising 26,000 metres
of surface drilling, will concentrate on increasing mineral
resources in the area of the proposed Hosco pit and the Heva
deposit. The objective of the 2011 drill campaign is to perform
step-out drilling on 50 metre spacing along the 2.5 kilometre
strike length of the Heva deposit and potential satellite zones,
down to 150 metres, in order to extend the mineral resources
contour and to increase the quality of the existing indicated and
inferred mineral resources. Two to three drill rigs will be
active during the first five months of 2011.
Aggressive exploration programs are also planned at the
Company's other Quebec properties totalling $17.1 million (before
tax credits) for the remaining nine months of 2011.
NON-GAAP MEASURES
Realized gold price per ounce of gold
Realized gold price per ounce of gold is a non-GAAP measure and
is calculated by adjusting revenue for all realized gains and
losses on gold derivative instruments and then dividing by the gold
ounces sold.
Total cash costs per ounce of gold
Aurizon has included a non-GAAP performance measure, total cash
costs per ounce of gold in this report. Aurizon reports total
cash costs on a sales basis. In the gold mining industry,
this is a common performance measure but does not have any
standardized meaning, and is a non-GAAP measure. The Company
believes that, in addition to conventional measures prepared in
accordance with GAAP, certain investors use this information to
evaluate the Company's performance and ability to generate cash
flow. Accordingly, it is intended to provide additional
information and should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
GAAP. Total cash costs per gold ounce are derived from
amounts included in the Statements of Comprehensive Income and
include mine site operating costs such as mining, processing and
administration, but exclude amortization, reclamation costs,
financing costs and capital development costs. The costs
included in the calculation of total cash costs per ounce of gold
are reduced by silver by-product sales and then divided by gold
ounces sold and the average Bank of Canada Cad$/US$ exchange
rate. For the first quarter of 2011, cost of sales were
reduced by depreciation and depletion charges of $8.0 million and
silver revenues of $0.2 million compared to $7.9 million and $0.2
million, respectively for the same period in 2010.
Unit mining costs per tonne
Unit mining costs per tonne is a non-GAAP measure and may not be
comparable to data prepared by other gold producers. The
Company believes that this generally accepted industry measure is a
realistic indication of operating performance and is useful in
allowing year over year comparisons. Unit mining costs per
tonne is calculated by adjusting operating costs included in cost
of sales, as shown in the Statements of Comprehensive Income, for
inventory adjustments and then dividing by the tonnes processed
through the mill. For the first quarter of 2011, operating
costs were increased by inventory adjustments of $0.6 million
compared to inventory adjustments of $0.1 million for the same
period in 2010.
Operating profit margin per ounce
Operating profit margin per ounce is a non-GAAP measure, and is
calculated by subtracting the total cash costs per ounce from the
average realized gold price. For the first quarter of 2011,
the average realized gold price was US$1,392 less total cash costs
of US$621 for an operating profit margin of US$771, compared to an
average realized gold price of US$1,010 less total cash costs of
US$538 for an operating profit margin of US$472 in the same quarter
of 2010.
OUTSTANDING SHARE DATA
As of May 10, 2011, Aurizon had 162,282,952 common shares issued
and outstanding. In addition, 9,430,350 incentive stock
options representing 5.8% of outstanding share capital are
outstanding and exercisable into common shares at an average price
of $5.11 per share.
Common
Shares
(TSX - ARZ & NYSE Amex -
AZK) |
| |
|
|
March 31, |
|
|
December 31, |
| |
|
|
2011 |
|
|
2010 |
| Issued |
|
|
162,271,702 |
|
|
162,145,702 |
| Fully-diluted |
|
|
171,815,302 |
|
|
171,815,302 |
| Weighted average |
|
|
162,260,681 |
|
|
160,249,688 |
CONFERENCE CALL AND WEBCAST
Aurizon management will host a conference call and
live webcast for analysts and investors on Thursday, May 12, 2011
at 8:00 a.m. Pacific Daylight Time (11:00 a.m. Eastern Daylight
Time) to review the results.
Conference Call Numbers:
Canada & USA Toll Free Dial In: 1-800-319-4610 or Outside
Canada & USA Call: 1-604-638-5340.
The call is being webcast and can be accessed at Aurizon's
website at www.aurizon.com or enter the following URL into your web
browser:
http://services.choruscall.com/links/aurizon110512.html.
Those who wish to listen to a recording of the conference call
at a later time may do so by calling: Canada & USA Toll Free:
1-800-319-6413 or outside Canada & USA: 1-604-638-9010, (Code:
1001#). A replay of the call will be available until
Thursday, May 19, 2011.
FORWARD LOOKING STATEMENTS AND INFORMATION
This report contains "forward-looking statements" and
"forward-looking information" within the meaning of applicable
securities regulations in Canada and the United States
(collectively, "forward-looking information"). The
forward-looking information contained in this report is made as of
the date of this report. Except as required under applicable
securities legislation, the Company does not intend, and does not
assume any obligation, to update this forward-looking
information. Forward-looking information includes, but is not
limited to, statements regarding the Company's expectations and
estimates as to future gold production, anticipated rates of
recovery, anticipated total cash cost per ounce of gold to be
produced at the Casa Berardi Mine, currency exchange rates, the
future price of gold and the effects thereof, the estimation of
mineral reserves and mineral resources, the realization of mineral
reserve and mineral resource estimates and the economic viability
thereof, the timing and amount of estimated capital expenditures,
costs and timing of the development of new deposits, plans and
budgets for and expected timing and results of exploration
activities and feasibility and pre-feasibility studies, permitting
time-lines, evaluation of opportunities, requirements for
additional capital, government regulation of mining operations,
environmental risks, reclamation obligations and expenses, title
disputes or claims, adequacy of insurance coverage, the
availability of qualified labour, acquisition plans and
strategies. Often, but not always, forward-looking
information can be identified by the use of words such as "plans",
"expects", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates", or "believes", or the
negatives thereof or variations of such words and phrases or
statements that certain actions, events or results "may", "could",
"would", "might", or "will" be taken, occur or be achieved.
The forward-looking information contained in this report is
based on certain assumptions that the Company believes are
reasonable, including the exchange rates of the U.S. and Canadian
currency in 2011, that the current price of and demand for gold
will be sustained or will improve, the supply of gold will remain
stable, that the current mill recovery rates at the Company's Casa
Berardi Mine will continue, that the Company's current mine plan
can be achieved, that the general business and economic conditions
will not change in a material adverse manner, that financing will
be available if and when needed on reasonable terms and that the
Company will not experience any material accident, labour dispute,
or failure of plant or equipment.
However, forward-looking information involves known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
information. Such factors include, among others, the risk
that actual results of exploration activities will be different
than anticipated, that cost of labour, equipment or materials will
increase more than expected, that the future price of gold will
decline, that the Canadian dollar will strengthen against the U.S.
dollar, that mineral reserves or mineral resources are not as
estimated, that actual costs or actual results of reclamation
activities are greater than expected; that changes in project
parameters as plans continue to be refined may result in increased
costs, of lower rates of production than expected, of unexpected
variations in ore reserves, grade or recover rates, of failure of
plant, equipment or processes to operate as anticipated, of
accidents, labour disputes and other risks generally associated
with mining, unanticipated delays in obtaining governmental
approvals or financing or in the completion of development or
construction activities, as well as those factors and other risks
more fully described in Aurizon's Annual Information Form filed
with the securities commission of all of the provinces and
territories of Canada and in Aurizon's Annual Report on Form
40-F filed with the United States Securities and Exchange
Commission, which are available on Sedar at www.sedar.com and on
Edgar at www.sec.gov. Although the Company has attempted to
identify important factors that could cause actual actions, events
or results to differ materially from those described in
forward-looking information, there may be other factors that cause
actions, events or results to not be as anticipated, estimated or
intended. There can be no assurance that forward-looking
information will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such
statements. Readers are cautioned not to place undue reliance
on forward-looking information due to the inherent uncertainty
thereof.
CAUTIONARY NOTE TO US READERS AND INVESTORS
As a British Columbia corporation, the Company is subject to
certain rules and regulations issued by the British Columbia
Securities Commission ("BC Securities Commission"). The
Company is required to provide detailed information regarding its
properties including mineralization, drilling, sampling and
analysis, security of samples and mineral resource and mineral
reserve estimates. Further, the Company describes mineral
resources associated with its properties utilizing terminology such
as "indicated" or "inferred" which terms are recognized by Canadian
regulations but are not recognized by the United States Securities
and Exchange Commission ("SEC").
Cautionary Note to U.S. Readers and Investors Regarding Mineral
Resources
The SEC allows mining companies, in their filings with the SEC, to
disclose only those mineral deposits they can economically and
legally extract or produce. The Company may use certain terms
in this document, such as "mineral resources", "indicated mineral
resources" and "inferred mineral resources" that are recognized and
mandated by Canadian securities regulators but are not recognized
by the SEC.
This document may use the term "indicated" mineral resources.
U.S. readers are cautioned that while that term is recognized and
required by Canadian regulations, the SEC does not recognize
it. U.S. readers and investors are cautioned not to
assume that any part or all of mineral deposits in this category
will ever be converted into mineral reserves.
This document may also use the term "inferred" mineral
resources. U.S. readers are cautioned that while this term is
recognized and required by Canadian regulations, the SEC does not
recognize it. "Inferred resources" have a great amount of
uncertainty as to their existence, and great uncertainty as to
their economic and legal feasibility. It cannot be assumed
that all or any part of an inferred mineral resource will ever be
upgraded to a higher category. Under Canadian rules,
estimates of inferred mineral resources may not form the basis of
feasibility or pre-feasibility studies, except in rare cases.
U.S. readers and investors are cautioned not to assume that part
or all of an inferred resource exists, or is economically or
legally mineable.
| Aurizon is a gold producer with a growth strategy focused on
developing its existing projects in the Abitibi region of
north-western Quebec, one of the world's most favourable mining
jurisdictions and prolific gold and base metal regions, and by
increasing its asset base through accretive transactions.
Aurizon shares trade on the Toronto Stock Exchange under the symbol
"ARZ" and on the NYSE Amex under the symbol "AZK". Additional
information on Aurizon and its properties is available on Aurizon's
website at www.aurizon.com. |
| Interim Balance Sheets as
at, |
| |
|
|
|
|
| (Unaudited, expressed
in thousands of Canadian dollars) |
|
March 31, 2011 |
December 31, 2010 |
January 1, 2010 |
| ASSETS |
|
|
|
|
| Current
assets |
|
|
|
|
| |
Cash and cash equivalents |
|
$ 142,799 |
$ 139,341 |
$ 113,098 |
| |
Marketable securities |
|
1,098 |
1,129 |
- |
| |
Inventories |
|
10,886 |
12,085 |
11,897 |
| |
Accounts receivable and other
receivables |
|
9,510 |
7,258 |
4,825 |
| |
Derivative instrument assets |
|
- |
- |
5,274 |
| |
Tax credits receivable |
|
10,676 |
12,398 |
2,587 |
| Total current
assets |
|
174,969 |
172,211 |
137,681 |
| Non-current
assets |
|
|
|
|
| |
Property, plant and equipment |
|
155,447 |
152,012 |
163,976 |
| |
Mineral properties |
|
4,250 |
4,220 |
2,362 |
| |
Deferred finance costs |
|
450 |
- |
- |
| |
Other assets |
|
10,563 |
8,100 |
14,551 |
| Total non-current
assets |
|
170,710 |
164,332 |
180,889 |
| TOTAL
ASSETS |
|
$ 345,679 |
$ 336,543 |
$ 318,570 |
| |
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
| Current
liabilities |
|
|
|
|
| |
Accounts payable and accrued liabilities |
|
$ 22,302 |
$ 18,905 |
$ 16,451 |
| |
Derivative instrument liabilities |
|
- |
- |
13,885 |
| |
Current tax liabilities |
|
- |
- |
3,752 |
| |
Current portion of long-term
obligations |
|
337 |
756 |
652 |
| Total current
liabilities |
|
22,639 |
19,661 |
34,740 |
| Non-current
liabilities |
|
|
|
|
| |
Long-term obligations |
|
- |
- |
705 |
| |
Provisions |
|
14,795 |
13,114 |
23,255 |
| |
Deferred tax liabilities |
|
35,649 |
35,378 |
28,150 |
| Total non-current
liabilities |
|
50,444 |
48,492 |
52,110 |
| Total
liabilities |
|
73,083 |
68,153 |
86,850 |
| |
|
|
|
|
| EQUITY |
|
|
|
|
| Shareholders'
equity |
|
|
|
|
| |
Issued capital |
|
270,244 |
269,677 |
253,874 |
| |
Contributed surplus |
|
1,022 |
1,022 |
979 |
| |
Stock based compensation |
|
14,943 |
13,719 |
10,514 |
| |
Deficit and accumulated other comprehensive income |
|
(13,613) |
(16,028) |
(33,647) |
| Total shareholders'
equity |
|
272,596 |
268,390 |
231,720 |
| |
|
|
|
|
|
| TOTAL LIABILITIES
AND EQUITY |
|
$ 345,679 |
$ 336,543 |
$ 318,570 |
| Interim
Statements of Comprehensive Income |
| |
|
|
|
| |
|
Three months ended |
| (Unaudited, expressed in thousands
of Canadian dollars except per share amounts) |
|
March 31, 2011 |
March 31,
2010 |
| |
|
|
|
| Revenue |
|
$ 47,212 |
$ 39,831 |
| Less cost of sales |
|
(29,228) |
(27,274) |
| Gross profit |
|
17,984 |
12,557 |
| |
|
|
|
| Less: |
|
|
|
| Exploration costs |
|
7,104 |
1,969 |
| General and administration
costs |
|
6,086 |
5,175 |
| Other net losses/ (gains) |
|
36 |
(735) |
| Operating profit |
|
4,758 |
6,148 |
| |
|
|
|
| Add: |
|
|
|
| Finance income |
|
339 |
89 |
| Finance costs |
|
(200) |
(366) |
| Profit before income
tax |
|
4,897 |
5,871 |
| |
|
|
|
| Less: |
|
|
|
| Income tax expense |
|
2,451 |
3,479 |
| PROFIT FOR THE PERIOD |
|
$
2,446 |
$ 2,392 |
| |
|
|
|
| Other comprehensive
income |
|
|
|
| Unrealized loss on marketable
securities |
|
(31) |
- |
| TOTAL COMPREHENSIVE INCOME FOR
THE PERIOD |
|
$ 2,415 |
$ 2,392 |
| |
|
|
|
| |
|
|
|
| Weighted average number of common
shares outstanding - Basic |
|
162,260,681 |
159,143,836 |
| Earnings per share - Basic |
|
0.02 |
0.02 |
| Weighted average number of common
shares outstanding - Diluted |
|
164,935,845 |
160,662,220 |
| Earnings per share - Diluted |
|
0.02 |
0.02 |
| Interim
Statements of Cash Flows |
| |
|
| |
|
Three months ended |
| (Unaudited, expressed
in thousands of Canadian dollars) |
|
March 31, 2011 |
March 31, 2010 |
| |
|
|
|
| Cash flows from
operating activities |
|
|
|
| Net income for the
period |
|
$ 2,446 |
$ 2,392 |
| Adjustment for
non-cash items: |
|
|
|
| |
Depreciation and depletion |
|
8,036 |
7,891 |
| |
Stock-based compensation |
|
1,398 |
2,861 |
| |
Unrealized derivative gains |
|
- |
(3,363) |
| |
Future income tax expense |
|
271 |
2,637 |
| |
Other |
|
2,071 |
314 |
| |
|
|
14,222 |
12,732 |
| |
Decrease (increase) in non-cash working capital items |
|
314 |
(3,566) |
| Net cash
provided by operating activities |
|
14,536 |
9,166 |
| |
|
|
|
| Cash flows from
investing activities |
|
|
|
| |
Property, plant and equipment |
|
(2,811) |
(1,583) |
| |
Mineral properties |
|
(7,765) |
(7,263) |
| |
Reclamation deposits |
|
(418) |
- |
| Net cash used in
investing activities |
|
(10,994) |
(8,846) |
| |
|
|
|
|
| Cash flows from
financing activities |
|
|
|
| |
Issuance of shares |
|
393 |
422 |
| |
Deferred finance costs |
|
(477) |
- |
| |
Long-term obligations |
|
- |
(20) |
| Net cash (used in)
provided by financing activities |
|
(84) |
402 |
| |
|
|
|
|
| NET INCREASE IN
CASH AND CASH EQUIVALENTS |
|
3,458 |
722 |
| CASH AND CASH
EQUIVALENTS - BEGINNING OF PERIOD |
|
139,341 |
113,098 |
| CASH AND CASH
EQUIVALENTS - END OF PERIOD |
|
$ 142,799 |
$ 113,820 |
SOURCE Aurizon Mines Ltd.