Trading Symbol: TSX: GGD
Shares Outstanding: 171,376,481
HALIFAX, May 10, 2018 /CNW/ - GoGold Resources Inc.
(TSX: GGD) ("GoGold", "the Company") reports record production
of 417,191 silver equivalent ounces in the quarter and generated
revenue of $5.4 million on the sale
of 337,821 silver equivalent ounces at an average realized price of
$15.99 in the quarter ending
March 31, 2018. (All amounts are in
U.S. dollars)
The difference between ounces produced and sold was attributed
to an increase in ounces awaiting settlement at the refinery. These
ounces were received and sold in April
2018 and the Company does not expect there to be a delay in
settlements in the current quarter. The Company's production
represents an increase of 50% over the second quarter of 2017 and
the sixth consecutive quarter of production growth.
The Company stacked 439,376 tonnes on the leach pad which
represents a 22% increase from the second quarter of 2017. The
Company completed the re-agglomeration of some of the older pads
and stacked 193,516 tons of fresh tailings. Management
foresees an increase in production in future quarters due to the
higher stacking rates, fresh tailings coming under leach, as well
as the residual leaching from the first lift. Cash costs for the
quarter were $10.67 per silver
equivalent ounce which was up 18% from the second quarter 2017 due
to the additional costs associated with re-agglomerating some
material. This number is expected to decrease as we stack more
fresh tailings in future quarters.
The Company reports a net loss of $41,000 for the three months ended March 31, 2018, and net income of $30.0 million and total comprehensive income of
$42.5 million for the six months
ended March 31, 2018.
The Company is pleased to report that during the quarter Agnico
Eagle Mines began an initial drilling program at the Santa
Gertrudis project with a budget of $8.3
million for the first phase of drilling. The Company
retained a 2% net smelter royalty on the project as part of the
sale in November 2017 and this
exploration program reaffirms managements view of its value.
As a result of the sale of Santa Gertrudis in November 2017 the company's working capital has
improved by $56.8 million to
$46.5 million during fiscal 2018.
Shareholder's equity has also improved by $42.6 million to $130.4
million during the year. The Company remains in strong
financial condition with $12.7
million in cash, a royalty on Santa Gertrudis that
management believes could be sold for approximately $15 million, inventory stacked on the heap leach
pad with recoverable metal worth approximately $40 million, and no debt. In addition to the
strong balance sheet, Parral is generating earnings before
interest, taxes, and depreciation and has a mine life of
approximately 10 years.
Summarized
Consolidated Financial Information
|
Three months
ended
March 31
|
|
Six months
ended
March 31
|
(in thousands USD,
except per share amounts)
|
|
2018
|
|
20171
|
|
|
2018
|
|
20171
|
Revenue
|
$
|
5,403
|
$
|
4,276
|
|
$
|
11,235
|
$
|
7,950
|
Production costs,
except amortization and depletion
|
|
3,605
|
|
2,297
|
|
|
7,888
|
|
4,232
|
Mine site
EBITDA2
|
|
1,798
|
|
1,979
|
|
|
3,347
|
|
3,718
|
Net (loss)
income
|
|
(41)
|
|
610
|
|
|
29,995
|
|
1,271
|
Basic net earnings
per share
|
|
0.00
|
|
0.00
|
|
|
0.18
|
|
0.01
|
1Adjusted
for discontinued operations associated with the sale of Santa
Gertrudis.
|
2Earnings
before interest, taxes, depreciation and amortization
|
Key Performance
Indicators1
|
Three months
ended
March 31
|
|
Six months
ended
March 31
|
|
2018
|
2017
|
|
2018
|
2017
|
Total tonnes
stacked
|
|
439,376
|
|
360,326
|
|
|
801,310
|
|
594,025
|
AISC per silver
equivalent ounce2
|
$
|
15.95
|
$
|
12.18
|
|
$
|
15.58
|
$
|
12.54
|
Cash cost per silver
ounce3
|
$
|
7.47
|
$
|
0.75
|
|
$
|
8.11
|
$
|
0.14
|
Cash cost per silver
equivalent ounce2
|
$
|
10.67
|
$
|
9.00
|
|
$
|
11.20
|
$
|
8.82
|
Realized silver
price
|
$
|
15.99
|
$
|
16.77
|
|
$
|
15.95
|
$
|
16.56
|
1Key
performance indicators are unaudited non-GAAP measures
|
2Gold is
converted using actual realized prices
|
3Using
Gold as a by-product credit
|
This news release should be read in conjunction with the
condensed consolidated interim financial statements for the three
and six months ended March 31, 2018,
notes to the financial statements, and management's discussion and
analysis for the three and six months ended March 31, 2018, which have been filed on SEDAR
and are available on the Company's website.
Mr. Robert Harris, P.Eng. is the
qualified person as defined by National Instrument 43-101 and is
responsible for the technical information of this release.
About GoGold Resources
GoGold Resources (TSX: GGD) is
a Canadian-based silver and gold producer focused on operating,
developing, exploring and acquiring high quality projects in
Mexico. The Company's Parral Tailings project produces silver
and gold at a low cash cost. Headquartered in Halifax, NS, GoGold is building a portfolio of
low cost, high margin projects. For more information visit
gogoldresources.com.
CAUTIONARY STATEMENT:
The securities described herein
have not been, and will not be, registered under the United States
Securities Act of 1933, as amended (the "U.S. Securities Act"), or
any state securities laws, and may not be offered or sold within
the United States or to, or for
the benefit of, U.S. persons (as defined in Regulation S under the
U.S. Securities Act) except in compliance with the registration
requirements of the U.S. Securities Act and applicable state
securities laws or pursuant to exemptions therefrom. This release
does not constitute an offer to sell or a solicitation of an offer
to buy of any of GoGold's securities in the United States.
This news release may contain "forward-looking information" as
defined in applicable Canadian securities legislation. All
statements other than statements of historical fact, included in
this release, including, without limitation, statements regarding
the Parral tailings project, future operating margins, future
production and processing, and future plans and objectives of
GoGold, constitute forward looking information that involve various
risks and uncertainties. Forward-looking information is based on a
number of factors and assumptions which have been used to develop
such information but which may prove to be incorrect, including,
but not limited to, assumptions in connection with the continuance
of GoGold and its subsidiaries as a going concern, general economic
and market conditions, mineral prices, the accuracy of mineral
resource estimates, and the performance of the Parral project.
There can be no assurance that such information will prove to be
accurate and actual results and future events could differ
materially from those anticipated in such forward-looking
information.
Important factors that could cause actual results to differ
materially from GoGold's expectations include exploration and
development risks associated with GoGold's projects, the failure to
establish estimated mineral resources or mineral reserves,
volatility of commodity prices, variations of recovery rates, and
global economic conditions. For additional information with respect
to risk factors applicable to GoGold, reference should be made to
GoGold's continuous disclosure materials filed from time to time
with securities regulators, including, but not limited to, GoGold's
Annual Information Form. The forward-looking information contained
in this release is made as of the date of this release.
Cautionary non-IFRS Measures and Additional IFRS
Measures
The Company believes that investors use certain
non-IFRS and additional IFRS measures as indicators to assess
mining companies. They are intended to provide additional
information and should not be considered in isolation or as a
substitute for measures of performance prepared with IFRS. Non-IFRS
and additional IFRS measures do not have a standardized meaning
prescribed under IFRS and therefore may not be comparable to
similar measures presented by other companies.
Additional IFRS measures that are presented on the face of the
Company's consolidated statements of comprehensive income include
"Operating income (loss)". These measures are intended to provide
an indication of the Company's mine and operating performance.
"Cash flow from operating activities before changes in non-cash
working capital" is a non-IFRS performance measure that could
provide an indication of the Company's ability to generate cash
flows from operations, and is calculated by adding back the change
in non-cash working capital to "Net cash used in operating
activities" as presented on the Company's consolidated statements
of cash flows. Per ounce measures are calculated by dividing the
relevant mining and processing costs and total costs by the ounces
of metal sold in the period. "Cash costs per ounce" and "all-in
sustaining costs per ounce" as used in this analysis are non-IFRS
terms typically used by mining companies to assess the level of
gross margin available to the Company by subtracting these costs
from the unit price realized during the period. These non-IFRS
terms are also used to assess the ability of a mining company to
generate cash flow from operations. There may be some variation in
the method of computation of these metrics as determined by the
Company compared with other mining companies. In this context,
"cash costs per ounce" reflects the cash operating costs allocated
from in-process and dore inventory associated with ounces of silver
and gold sold in the period. "Cash costs per ounce" may vary from
one period to another due to operating efficiencies, grade of
material processed and silver/gold recovery rates in the period.
"All-in sustaining costs per ounce" include total cash costs,
exploration, corporate and administrative, share based compensation
and sustaining capital costs. For a reconciliation of non-IFRS and
IFRS measures, please refer to the Management Discussion and
Analysis dated May 9, 2018, for the
three and six months ended March 31,
2018, as presented on SEDAR.
SOURCE GoGold Resources Inc.