YAMANA GOLD INC. (TSX:YRI; NYSE:AUY) (“Yamana” or “the Company”)
announces second quarter 2019 production of 257,556 gold equivalent
ounces (“GEO”). Production exceeded plan and preliminary costs are
within the previous guidance range for the quarter. The Company
continues to anticipate a strong second half and remains on track
to meet its full-year 2019 guidance. Consistent with previous
guidance, the Company expects to report positive free cash flow in
the second quarter. Free cash flow is expected to increase in the
second half of the year, as operating results will be aided by
recently announced reductions in general and administrative
expenses and lower interest expense due to anticipated debt
reduction. The Company will also have less investment in long-term
stockpile following the disposition of the Chapada mine.
The Company reports gold and silver on a GEO
basis and by individual metal. Both gold and silver production were
above plan. GEO was also above plan despite a higher gold to silver
ratio than presented in guidance, mostly the result of strong gold
and silver production compared to plan.
SECOND QUARTER 2019 PRODUCTION RESULTS
Yamana Mines |
Second Quarter 2019 Preliminary Production |
GEO(1) Production (oz.) |
257,556 |
Gold Production (oz.) |
232,863 |
Silver Production (m oz.) |
2,171,836 |
Copper Production (M lbs.) |
31,230 |
1. GEO includes gold plus silver with silver converted to a gold
equivalent at a ratio of 87.98:1 for the second quarter. The GEO
ratio is calculated based on average market prices prevalent during
the quarter.
SECOND QUARTER 2019 PRODUCTION BY MINE
Mine-by-Mine |
Second Quarter 2019 Preliminary Production |
Gold (oz.) |
|
|
Chapada |
29,019 |
El Peñón |
34,646 |
Canadian Malartic (50%) |
84,311 |
Jacobina |
38,951 |
Cerro Moro |
29,643 |
Minera Florida |
16,293 |
Yamana Mines |
232,863 |
Silver (oz.) |
|
El Peñón |
843,585 |
Cerro Moro |
1,328,251 |
Yamana Mines |
2,171,836 |
Copper (M lbs.) |
|
Chapada |
31,230 |
Jacobina recorded its eleventh straight quarter
of production of well over 30,000 ounces of gold and second
straight quarter of record production. The mine continues to emerge
as a leading operation on production, costs, and safety. Canadian
Malartic, Cerro Moro, and El Peñón all posted strong second-quarter
results, underscoring the Company’s focus on operational excellence
and efficiency. Production at Minera Florida was impacted by a
period of reduced productivity during the quarter as the Company
negotiated new collective bargaining agreements with several
unions. Agreements have since been reached with all unions. At
Chapada, gold production exceeded plan and copper production was in
line with plan mostly as a result of accessing ores in the Corpo
Sul pit at mineral reserve grade for copper although with higher
gold grades.
SECOND QUARTER HIGHLIGHTS
- Announced the sale of Chapada on April 15, 2019. Consideration
included an initial upfront cash payment of $800 million, a $100
million cash payment contingent on the development of a pyrite
roaster at Chapada by Lundin, a two per cent net smelter return
royalty on the Suruca gold project in the Chapada complex, and the
right to receive up to $125 million in additional cash
consideration based on the price of gold over the five-year period
from the date of close.
- Increased three-year guidance for Jacobina and provided an
update on the mine’s phased plan to increase production to up to
225,000 ounces per year by 2023.
- Implemented corporate overhead reductions and streamlined the
Company’s organizational structure to reflect its current portfolio
of assets. These reductions are expected to generate $15 million in
annualized savings thereby reducing corporate overhead on a cash
basis to $60 million per year.
SUBSEQUENT TO QUARTER END
- The Chapada sale was completed after which the Company used the
$800 million in upfront cash proceeds to repay the amount
outstanding under its revolving credit facility and launch tender
offers to repay certain near and medium-term fixed term debt
maturities.
UPDATED 2019 PRODUCTION GUIDANCE
As a result of the sale of Chapada, which closed
July 5, 2019, the Company is adjusting its full-year 2019 guidance
as follows:
|
Previous 2019 Guidance |
Revised 2019 Guidance |
Total GEO Production (oz.)1 |
1,060,000 |
1,010,000 |
Gold Production (oz.) |
940,000 |
899,000 |
1. GEO includes gold plus silver with silver converted to a gold
equivalent at a ratio of 85.87:1 for the first half of 2019 and an
assumed ratio of 93:1 for the second half of 2019, reflecting
approximate gold and silver prices on July 10, 2019, for purposes
of the revised 2019 guidance.
UPDATED 2019 PRODUCTION GUIDANCE BY MINE
Mine-by-Mine |
Previous 2019 Guidance |
Updated 2019 Guidance |
|
Gold (oz.) |
|
|
|
|
Chapada |
100,000 |
52,000 |
|
El Peñón |
150,000 |
150,000 |
|
Canadian Malartic (50%) |
330,000 |
330,000 |
|
Jacobina |
145,000 |
152,000 |
(1) |
Cerro Moro |
130,000 |
130,000 |
|
Minera Florida |
85,000 |
85,000 |
|
Yamana Mines |
940,000 |
899,000 |
|
Silver (oz.) |
|
|
|
El Peñón |
4,000,000 |
4,000,000 |
|
Cerro Moro |
6,000,000 |
6,000,000 |
|
Yamana Mines |
10,000,000 |
10,000,000 |
|
Copper (M lbs.) |
|
|
|
Chapada |
120 |
61 |
|
1. Jacobina 2019 production guidance previously increased.
Please see press release titled ‘Yamana Gold Increases Gold
Production Guidance and Updates Improved Strategic Life of Mine
Plan and Phased Expansion for Its Jacobina Mine’ dated June 27,
2019.
UPCOMING EVENTS AND CATALYSTS
- The release of second quarter financial and operational results
on July 25.
- Results of the Agua Rica pre-feasibility study.
- Delivery of updated mineral reserve and mineral resource
estimates for Jacobina along with an exploration update for the
operation during the third quarter of 2019.
- Delivery of a broader exploration update on various operations
in the third quarter of 2019.
- Investor tour of the Jacobina mine from October 1-3.
- Results of Jacobina pre-feasibility study in the first quarter
of 2020.
- Results of East Malartic and Odyssey pre-feasibility study in
the first quarter of 2020.
SECOND QUARTER AND FULL YEAR 2019 FINANCIAL RESULTS RELEASE
The Company will release its complete second
quarter 2019 operational and financial results after market close
on Thursday, July 25, 2019, followed by a conference call and
webcast on Friday, July 26, 2019, at 9:00 a.m. ET.
Second Quarter 2019 Conference
Call
Toll Free (North America): |
1-800-273-9672 |
Toronto Local and International: |
416-340-2216 |
Webcast: |
www.yamana.com |
|
|
Conference Call Replay |
|
|
|
Toll Free (North America): |
1-800-408-3053 |
Toronto Local and International: |
905-694-9451 |
Passcode: |
6784586# |
The conference call replay will be available
from 12:00 p.m. ET on July 26, 2019, until 11:59 p.m. ET on August
16, 2019.
About Yamana
Yamana is a Canadian-based gold, silver and
copper producer with a significant portfolio comprised of operating
mines, development stage projects, and exploration and mineral
properties throughout the Americas, mainly in Canada, Brazil,
Chile and Argentina. Yamana plans to continue to
build on this base through expansion and optimization initiatives
at existing operating mines, development of new mines, the
advancement of its exploration properties and, at times, by
targeting other consolidation opportunities with a primary focus in
the Americas.
FOR FURTHER INFORMATION PLEASE CONTACT:
Investor Relations416-815-0220
1-888-809-0925 Email: investor@yamana.com
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS: This news release contains
“forward-looking statements” and “forward-looking information”
under applicable Canadian securities legislation and within the
meaning of the United States Private Securities Litigation Reform
Act of 1995. Forward-looking information includes, but is not
limited to information with respect to the Company’s future
financial or operating performance, including free cash flow and
production costs, results of feasibility studies, repayment of debt
or updates regarding Mineral Reserves and Mineral Resources.
Forward-looking statements are characterized by words such as
“plan,” “expect”, “budget”, “target”, “project”, “intend”,
“believe”, “anticipate”, “estimate” and other similar words, or
statements that certain events or conditions “may” or “will” occur.
Forward-looking statements are based on the opinions, assumptions
and estimates of management considered reasonable at the date the
statements are made, and are inherently subject to a variety of
risks and uncertainties and other known and unknown factors that
could cause actual events or results to differ materially from
those projected in the forward-looking statements. These
factors include the Company’s expectations in connection with
production and exploration, development and expansion plans at the
Company's projects being met, the impact of proposed optimizations
at the Company's projects, changes in national and local government
legislation, taxation, controls or regulations and/or changes in
the administration or laws, policies and practices, and the impact
of general business and economic conditions, global liquidity and
credit availability on the timing of cash flows and the values of
assets and liabilities based on projected future conditions,
fluctuating metal prices (such as gold, copper, silver and zinc),
currency exchange rates (such as the Brazilian real, the Chilean
peso, and the Argentine peso versus the United States dollar), the
impact of inflation, possible variations in ore grade or recovery
rates, changes in the Company’s hedging program, changes in
accounting policies, changes in Mineral Resources and Mineral
Reserves, risks related to asset disposition, risks related to
metal purchase agreements, risks related to acquisitions, changes
in project parameters as plans continue to be refined, changes in
project development, construction, production and commissioning
time frames, unanticipated costs and expenses, higher prices for
fuel, steel, power, labour and other consumables contributing to
higher costs and general risks of the mining industry, failure of
plant, equipment or processes to operate as anticipated, unexpected
changes in mine life, final pricing for concentrate sales,
unanticipated results of future studies, seasonality and
unanticipated weather changes, costs and timing of the development
of new deposits, success of exploration activities, permitting
timelines, government regulation and the risk of government
expropriation or nationalization of mining operations, risks
related to relying on local advisors and consultants in foreign
jurisdictions, environmental risks, unanticipated reclamation
expenses, risks relating to joint venture operations, title
disputes or claims, limitations on insurance coverage and timing
and possible outcome of pending and outstanding litigation and
labour disputes, risks related to enforcing legal rights in foreign
jurisdictions, as well as those risk factors discussed or referred
to herein and in the Company's Annual Information Form filed with
the securities regulatory authorities in all provinces of Canada
and available at www.sedar.com, and the Company’s Annual Report on
Form 40-F filed with the United States Securities and Exchange
Commission. 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 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 Company undertakes no obligation to update
forward-looking statements if circumstances or management’s
estimates, assumptions or opinions should change, except as
required by applicable law. The reader is cautioned not to place
undue reliance on forward-looking statements. The forward-looking
information contained herein is presented for the purpose of
assisting investors in understanding the Company’s expected
financial and operational performance and results as at and for the
periods ended on the dates presented in the Company’s plans and
objectives and may not be appropriate for other purposes.
(All amounts expressed in United States dollars
unless otherwise indicated.)
Yamana Gold (TSX:YRI)
Historical Stock Chart
From Aug 2024 to Sep 2024
Yamana Gold (TSX:YRI)
Historical Stock Chart
From Sep 2023 to Sep 2024