VANCOUVER, Nov. 5, 2013 /CNW/ - Sandstorm Gold Ltd.
("Sandstorm" or the "Company") (NYSE MKT: SAND, TSX: SSL) has
released its unaudited results for the third quarter ended
September 30, 2013 (all figures in
U.S. dollars).
Third Quarter Highlights
- Record Gold sales of 9,570 ounces (excluding Premier Royalty's
attributable ounces).
- Revenue of $15.4 million.
- Average cash cost per ounce1 of $430 resulting in cash operating
margins1 of $894 per
ounce.
- Operating cash flow of $8.6
million.
- Acquired all of the outstanding common shares of Premier
Royalty Inc. ("Premier Royalty").
- Completed a $10 million loan to
Luna Gold Corp. ("Luna") in accordance with the previously
announced commitment to issue a non-revolving loan facility to
Luna.
- Amended the previously announced gold stream with Mutiny Gold
Ltd. to a 2.6% gold stream on the Deflector mine.
- Net loss of $2.0 million
primarily due to a non-cash impairment charge of $3.2 million related to the conversion of the
Bracemac-McLeod gold stream into a 0.6% net smelter return royalty,
and an approximately $1.5 million
increase in expenses arising from the Premier Royalty business
combination.
Sandstorm President & CEO Nolan Watson commented, "We are encouraged by
the record gold sales and strong operating cash flow during the
quarter. Over the next twelve months we anticipate that our assets
will continue to ramp up production, while our general and
administrative expenses are expected to decrease materially due to
cost cutting and other reductions which have been made subsequent
to quarter end. Having over $90
million in cash on our balance sheet enables us to actively
pursue new streams and royalties, with the focus on increasing the
Company's per share value."
On October 4,
2013, Sandstorm closed its previously announced arrangement
agreement whereby the Company acquired all the outstanding common
shares of Premier Royalty. As part of a general and administrative
cost reduction plan, a number of the management team and employees
of Premier Royalty were released, resulting in one-time costs that
will be recognized during the fourth quarter of 2013.
Outlook
Based on the Company's existing gold streams and
excluding any attributable production relating to Premier Royalty,
forecasted 2013 attributable production is between 33,000 and
37,000 gold equivalent ounces, increasing to approximately 60,000
gold equivalent ounces per annum by 2016. This growth is driven by
the Company's portfolio of gold streams with mines, almost all of
which are either currently producing or expected to commence
production by 2015.
Webcast and Conference Call Details
A conference call will be held on Wednesday, November 6, 2013 starting at
9:30am PST to further discuss the
third quarter results. To participate in the conference call use
the dial-in numbers below. It is recommended that participants dial
in five minutes prior to the commencement of the conference call.
To access an audio webcast of the conference call, click here. The
webcast will also be available on the Sandstorm website.
Local/International: 647-788-4916
North American Toll-Free: 877-214-4966
Sandstorm's Management's Discussion and Analysis
(MD&A) and Financial Statements for the third quarter results
will be accessible on the Company's website and on SEDAR at
www.sedar.com. The Company has also completed a Form 6-K filing
with the SEC that will be accessible on EDGAR at
www.sec.gov/edgar.shtml. Shareholders can request a hard copy
of the MD&A and Financial Statements by emailing
info@sandstormltd.com.
Note 1: Sandstorm has included certain
performance measures in this press release that do not have any
standardized meaning prescribed by International Financial
Reporting Standards (IFRS) including average cash cost per ounce of
gold and cash operating margin. Average cash cost per ounce of gold
is calculated by dividing the total cost of sales, less depletion,
by the ounces sold. In the precious metals mining industry, this is
a common performance measure but does not have any standardized
meaning. The Company believes that, in addition to conventional
measures prepared in accordance with IFRS, certain investors use
this information to evaluate the Company's performance and ability
to generate cash flow. Cash operating margin is calculated by
subtracting the average cash cost per ounce of gold from the
average realized selling price per ounce of gold. The Company
presents cash operating margin as it believes that certain
investors use this information to evaluate the Company's
performance in comparison to other companies in the precious metals
mining industry who present results on a similar basis. The
presentation of these non-IFRS measures 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 IFRS. Other companies may calculate these non-IFRS measures
differently.
ABOUT SANDSTORM GOLD
Sandstorm Gold Ltd. is a gold streaming company.
Sandstorm provides upfront financing to gold mining companies that
are looking for capital and in return, receives a gold streaming
agreement. This agreement gives Sandstorm the right to purchase a
percentage of the gold produced from a mine, for the life of the
mine, at a fixed price per ounce. Sandstorm has acquired a
portfolio of nine gold streams and twenty-five gold royalties, of
which thirteen of the underlying mines are producing gold.
Sandstorm plans to grow and diversify its low cost production
profile through the acquisition of additional gold streams.
Sandstorm is focused on low cost operations with
excellent exploration potential and strong management teams.
Sandstorm has completed gold stream agreements with Brigus Gold
Corp., Colossus Minerals Inc., Entrée Gold Inc., Luna Gold Corp.,
Metanor Resources Inc., Mutiny Gold Ltd., Santa Fe Gold Corp., and
SilverCrest Mines Inc., Rambler Metals and Mining plc.
For more information visit:
www.sandstormgold.com.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION
This press release contains "forward-looking
statements", within the meaning of the U.S. Securities Act of 1933,
the U.S. Securities Exchange Act of 1934, the Private Securities
Litigation Reform Act of 1995 and applicable Canadian securities
legislation, concerning the business, operations and financial
performance and condition of Sandstorm Gold Ltd. ("Sandstorm").
Forward-looking statements include, but are not limited to,
statements with respect to the future price of gold, the estimation
of mineral reserves and resources, realization of mineral reserve
estimates, and the timing and amount of estimated future
production. Forward-looking statements can generally be
identified by the use of forward-looking terminology such as "may",
"will", "expect", "intend", "estimate", "anticipate", "believe",
"continue", "plans", or similar terminology.
Forward-looking statements are made based upon
certain assumptions and other important factors that, if untrue,
could cause the actual results, performances or achievements of
Sandstorm to be materially different from future results,
performances or achievements expressed or implied by such
statements. Such statements and information are based on
numerous assumptions regarding present and future business
strategies and the environment in which Sandstorm will operate in
the future, including the price of gold and anticipated costs.
Certain important factors that could cause actual results,
performances or achievements to differ materially from those in the
forward-looking statements include, amongst others, gold price
volatility, discrepancies between actual and estimated production,
mineral reserves and resources and metallurgical recoveries, mining
operational and development risks relating to the parties which
produce the gold Sandstorm will purchase, regulatory restrictions,
activities by governmental authorities (including changes in
taxation), currency fluctuations, the global economic climate,
dilution, share price volatility and competition.
Forward-looking statements are subject to known
and unknown risks, uncertainties and other important factors that
may cause the actual results, level of activity, performance or
achievements of Sandstorm to be materially different from those
expressed or implied by such forward-looking statements, including
but not limited to: the impact of general business and economic
conditions, the absence of control over mining operations
from which Sandstorm will purchase gold and risks related to those
mining operations, including risks related to international
operations, government and environmental regulation, actual results
of current exploration activities, conclusions of economic
evaluations and changes in project parameters as plans continue to
be refined, risks in the marketability of minerals, fluctuations in
the price of gold, fluctuation in foreign exchange rates and
interest rates, stock market volatility, as well as those factors
discussed in the section entitled "Risks to Sandstorm" in
Sandstorm's annual report for the financial year ended December 31, 2012 available at
www.sedar.com. Although Sandstorm has attempted to identify
important factors that could cause actual results to differ
materially from those contained in forward-looking statements,
there may be other factors that cause results not to be as
anticipated, estimated or intended. 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 forward-looking statements. Sandstorm does not
undertake to update any forward looking statements that are
contained or incorporated by reference, except in accordance with
applicable securities laws.
SOURCE Sandstorm Gold Ltd.