VANCOUVER, May 8, 2019 /CNW/ - Avino Silver & Gold Mines Ltd. (ASM:
TSX/NYSE American; FSE:GV6, "Avino" or "the
Company") released today its consolidated financial
results for the Company's first quarter ended March 31, 2019. The Financial Statements
and Management Discussion and Analysis (MD&A) can be viewed on
the Company's web site at www.avino.com, on SEDAR at
www.sedar.com and on EDGAR at www.sec.gov.
FIRST QUARTER 2019 HIGHLIGHTS
- Generated revenues of $6.7
million from the sale of concentrates
- Mine operating income of $56
thousand
- Net loss after taxes of $0.6
million or ($0.01) loss per
share
- Silver equivalent production of 615,019 ounces1,
including 268,399 ounces of silver, 1,813 ounces of gold and
1,062,702 pounds of copper
- Total consolidated cash cost2 was $11.44 per silver equivalent payable
ounce1
- Consolidated all-in sustaining cost ("AISC")2 was
$13.81 per silver payable equivalent
ounce1
- Working capital of $10.5
million
- Earnings before interest, taxes, depreciation and amortization
("EBITDA") was $49 thousand
- Cash of $2.5 million was on hand
at the end of the quarter
1. In Q1
2019, AgEq was calculated using metals prices of $15.57 oz Ag,
$1,304 oz Au and $2.82 lb Cu. In Q1 2018, AgEq was calculated using
metals prices of $16.77 oz Ag, $1,330 oz Au and $3.16 lb
Cu
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2.. The Company
reports non-IFRS measures which include cash cost per silver
equivalent ounce, all-in sustaining cash cost per ounce, and cash
flow per share. These measures are widely used in the mining
industry as a benchmark for performance, but do not have a
standardized meaning and the calculation methods may differ from
methods used by other companies with similar reported
measures
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"As a result of the ongoing depressed metals market environment
together with the planned 7 day upgrade to the crushing circuit in
which all mill circuits were offline, earnings during the first
quarter of 2019 were affected" said David
Wolfin, President and CEO. "On a positive note, the
installation of a tailings thickener commenced which should be
completed on schedule and ready for startup in May, 2019. In
addition, engineering work is ongoing for a new tailings storage
facility in the historic open pit which is already permitted.
Furthermore, we are confident that our decision to pursue the mill
expansion in 2018 was the right move to position ourselves for the
future. I'm proud of our diligent approach to trimming our G&A
expenses with a 38% reduction this quarter compared to Q1 2018. We
will continue to focus on profitable ounces and keeping costs
controlled company-wide."
Operational Highlights
HIGHLIGHTS (Expressed in US$)
|
First Quarter
2019
|
First Quarter
2018
|
Change
|
Operating
|
Tonnes Milled
|
197,687
|
140,817
|
40%
|
Silver
Ounces Produced
|
268,399
|
309,927
|
-13%
|
Gold Ounces
Produced
|
1,813
|
2,065
|
-12%
|
Copper Pounds
Produced
|
1,062,702
|
970,165
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10%
|
Silver Equivalent
Ounces1 Produced
|
615,019
|
656,699
|
-6%
|
Concentrate Sales
and Cash Costs
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Silver Equivalent
Payable Ounces Sold2
|
522,626
|
566,157
|
-8%
|
Cash Cost
per Silver Equivalent Payable Ounce1,2
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$11.44
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$
9.63
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19%
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All-in Sustaining Cash
Cost per Silver Equivalent Payable Ounce1,2
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$13.81
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$
11.74
|
18%
|
|
1. In Q1 2019,
AgEq was calculated using metals prices of $15.57 oz Ag, $1,304 oz
Au and $2.82 lb Cu. In Q1 2018, AgEq was calculated using metals
prices of $16.77 oz Ag, $1,330 oz Au and $3.16 lb
Cu.
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2. "Silver
equivalent ounces sold" for the purposes of cash costs and all-in
sustaining costs consists of the sum of silver ounces, gold ounces
and copper tonnes sold multiplied by the ratio of the average spot
gold and copper prices to the average spot silver price for the
corresponding period.
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|
3. The Company
reports non-IFRS measures which include cash cost per silver
equivalent ounce, all-in sustaining cash cost per ounce, and cash
flow per share. These measures are widely used in the mining
industry as a benchmark for performance, but do not have a
standardized meaning and the calculation methods may differ from
methods used by other companies with similar reported
measures.
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Financial Highlights
HIGHLIGHTS (Expressed in 000's of US$)
|
First Quarter
2019
|
First Quarter
2018
|
Change
|
Financial
|
Revenues
|
$
|
6,711
|
$
|
8,156
|
-18%
|
Mine operating
income
|
$
|
56
|
$
|
1,856
|
-97%
|
Net income
(loss)
|
$
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(610)
|
$
|
818
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-175%
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Cash
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$
|
2,526
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$
|
2,340
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8%
|
Working
capital
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$
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10,507
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$
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11,558
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-9%
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Earnings before
interest, taxes and amortization ("EBITDA")1
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$
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49
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$
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1,687
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-97%
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Adjusted
EBITDA1
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$
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-
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$
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1,501
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-100%
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Per Share
Amounts
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Earnings (loss) per
share ("EPS") – basic
|
$
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(0.01)
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$
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0.02
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-150%
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Cash flow
per share (YTD)1 – basic
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$
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0.00
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$
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0.02
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-100%
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1. The Company
reports non-IFRS measures which include cash cost per silver
equivalent payable ounce, all-in sustaining cash cost per payable
ounce, EBITDA, adjusted EBITDA, and cash flow per share. These
measures are widely used in the mining industry as a benchmark for
performance, but do not have a standardized meaning and the
calculation methods may differ from methods used by other companies
with similar reported measures. See Non-IFRS Measures section for
further information and detailed reconciliations.
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Financial
Results
The Company generated revenues of $6.7
million during Q1 2019; which was 18% lower than Q1 2018.
The lower revenues are a result of lower production and lower
realized metals prices.
Mine operating income was $56
thousand during Q1 2019, compared to $1.9 million in the same period of 2018.
The decrease is reflective of lower realized metal prices, lower
grades achieved, depletion at San Gonzalo, as well as the planned 7
day upgrade to the crushing circuit, in which all mill circuits
were offline.
During Q1 2019, the Company reported a net loss of $0.6 million or $(0.01) loss per share, compared to net income of
$0.8 million or $0.02 earnings per share in Q1 2018.
Operational Results
Silver equivalent production for Q1 2019 decreased by
6% to 615,019 oz1 compared to 656,699 oz1 in
Q1 2018. Silver production for Q1 2019 decreased 13% to
268,399 oz1 compared to 309,927 oz1 in Q1
2018. Gold production for Q1 2019 decreased by 12% to
1,813 oz compared to 2,065 oz in the corresponding period of 2018.
Copper production increased by 10% to 1,062,702 lbs compared to
970,165 lbs in Q1 2018. Total mill feed processed during Q1 2019
increased 40% to 197,687 dry tonnes which comprised 100,922 tonnes
from Avino, 17,901 tonnes from San Gonzalo and 78,864 tonnes from
AHAG Stockpiles.
Production results for the quarter are reflective of lower
grades that were part of the planned mining sequence, as well as
the planned 7 day upgrade which was mentioned above. The upgrades
to the crushing circuit will ensure that the processing facility
will realize more consistent throughput from the crusher during the
rainy season in Mexico.
The mill circuit configuration in Q1 2019 was the same as Q4
2018, where Mill Circuit 1 processed material from the San Gonzalo
Mine, Mill Circuit 2 processed material from the San Luis area of the Avino Mine, Mill Circuit
3 processed material from Elena Tolosa and Mill Circuit 4 processed
material from the AHAG Stockpiles.
At the Avino Mine, silver equivalent ounces1 produced
during Q1 2019 totalled 379,798 compared to 480,315 during Q1 2018,
a decrease of 21%. The decrease is due to the mill throughput from
Avino Mine material which was down 16% on a quarterly basis
primarily due to the shutdown of all mill circuits. The downtime
was offset by increased efficiencies gained on Mill Circuit 3, as
the Company continues to further refine its production process.
On a quarterly basis, copper feed grade increased by 14%, while
silver and gold feed grades decreased by
27% and 17%, respectively. The change in grades was due to the
mining sequence at the Elena Tolosa and San Luis areas.
Recovery rates for Q1 2019 showed improvement compared with Q1
2018, with increases of 4% in silver, gold, and copper recovery
rates.
As a result of the items mentioned above, overall production was
down on a silver-equivalent basis by 21% when comparing Q1 2019 to
Q1 2018.
At the San Gonzalo Mine, silver equivalent ounces1
produced during Q1 2019 totalled 86,406 representing a decrease of
51% compared to 176,384 in Q1 2018.
During Q1 2019, silver and gold feed grades at San Gonzalo
declined by 29% and 50%, respectively, compared to Q1 2018. This,
along with a decrease in both silver and gold recovery, resulted in
a 51% decrease in silver equivalent ounces produced compared to Q1
2018.
San Gonzalo is approaching its end of life, and the grades,
recoveries and production have begun to decline. This is in line
with our internal expectations, and the results are indicative of
both the decline and the previously mentioned planning upgrades to
the crushing circuit. Upon closure, the Company will plan to
transition some of the workers from San Gonzalo to the San Luis area.
In Q1 2019, Mill Circuit 4 processed 78,864 tonnes of the AHAG
Stockpiles, which represents a 14% increase in throughput compared
to Q4 2018, with no comparative figures for Q1 2018 as the Company
commencing processing AHAG Stockpiles in May
2018.
During Q1 2019, silver and copper feed grades increased by 2%
and 17%, respectively, compared to Q4 2018. Gold feed grade
compared to Q4 2018 declined by 7%.
Costs and Capital Expenditures
Consolidated cash costs per AgEq ounce2 during Q1
2019 were $11.44, while the all-in
sustaining cash costs per AgEq ounce2 during Q1 2019
were $13.81 compared to $9.63 and $11.74,
respectively, during Q1 2018, an increase of 19% for cash costs and
a 18% increase in the all-in sustaining cash costs due to grade
variation in the current mining areas of the Avino Mine and lower
ounces sold as a result of declining grades at San Gonzalo.
All-in sustaining cash cost2 at San Gonzalo during Q1
2019 was $14.21 per AgEq
ounce1 compared to $10.69
during Q1 of 2018.
All-in sustaining cash costs2 at Avino during Q1 2019
was $13.94, compared to $12.14 realized during Q1 2018, the increases
attributable to the higher costs mentioned above.
All-in sustaining cash costs2 for AHAG stockpiles
during Q1 2019 was $12.23, and is
compared to Q4 2018 at $7.14, as
there are no comparative figures for Q1 2018 as the Company
commenced processing AHAG Stockpiles in May
2018.
Capital expenditures during the three months ended March 31, 2019, were $2.5
million compared to compared to $3.6
million for the corresponding period of 2018.
Capital expenditures mainly relate to the upgrades to the
crushing circuit which includes all four mill circuits, as well as
the installation of the thickener.
1. In Q1
2019, AgEq was calculated using metals prices of $15.57 oz Ag,
$1,304 oz Au and $2.82 lb Cu. In Q1 2018, AgEq was calculated using
metals prices of $16.77 oz Ag, $1,330 oz Au and $3.16 lb
Cu
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|
2. The Company
reports non-IFRS measures which include cash cost per silver
equivalent ounce, all-in sustaining cash cost per ounce, and cash
flow per share. These measures are widely used in the mining
industry as a benchmark for performance, but do not have a
standardized meaning and the calculation methods may differ from
methods used by other companies with similar reported
measures
|
Bralorne Mine Update
Avino continued its exploration and drilling campaign at
Bralorne in the first quarter of 2019 using flow through funds that
were raised in April of 2018. These funds are available to be used
by December 31, 2019. An estimated
CDN $4.4 million will be spent on
diamond drilling to target new discoveries in unexplored portions
of the property. Phase One of the drilling proceeded from Q4
2018 to Q1 2019 and targeted underexplored portions of known
veins. Phase Two of the drilling will continue from Q1 to Q4,
2109 and will be targeting new discoveries in unexplored portions
of the property.
Detailed results from Phase One can be found in press releases
dated December 17, 2018 and
April 1, 2019 on the Avino website
under the news tab or on the Company's profiles on the SEDAR
website maintained by the Canadian Securities Administrators at
www.sedar.com or the SEC's website at www.sec.gov, as
applicable. Preliminary results from Phase two are also
outlined in the April 1, 2019 news
release.
Non-IFRS Measures
The financial results in this news release include references to
cash flow per share, cash cost per silver equivalent ounce, and
all-in sustaining cash cost per silver equivalent ounce, all of
which are non-IFRS measures. Cash flow per share, cash cost per
ounce, and all-in sustaining cash cost per ounce are measures
developed by mining companies in an effort to provide a comparable
standard of performance. However, there can be no assurance that
our reporting of these non-IFRS measures is similar to that
reported by other mining companies. Cash flow per share, cash cost
per silver equivalent ounce, and all-in sustaining cash cost per
silver equivalent ounce are measures used by the Company to manage
and evaluate operating performance of the Company's mining
operations, and are widely reported in the silver and gold mining
industry as benchmarks for performance, but do not have
standardized meanings prescribed by IFRS, and are disclosed in
addition to the prescribed IFRS measures provided in the Company's
financial statements and MD&A.
Conference
Call
In addition, the Company will be holding a conference call and
webcast on Thursday, May 9, 2019 at
8:00 am PDT (11:00 am EDT).
Shareholders, analysts, investors and media are invited to join
the webcast and conference call by logging in here Avino First
Quarter 2019 Webcast and Conference Call or by dialing the
following numbers five to ten minutes prior to the start time:
Toll Free Canada & USA:
1-800-319-4610
Outside of Canada &
USA: 1-604-638-5340
No pass-code is necessary to participate in the conference call
or webcast; participants will have the opportunity to ask questions
during the Q&A portion.
The conference call and webcast will be recorded and the replay
will be available on the Company's web site later that day.
Qualified Person(s)
Jasman Yee, P.Eng., Avino
Director and Peter Latta, P.Eng,
MBA, Senior Technical Advisor, both of whom are qualified persons
within the context of National Instrument 43-101 have reviewed and
approved the technical data in this document. Avino's Bralorne
project is under the supervision of Fred
Sveinson, B.A., B.Sc., P. Eng., Senior Mining Advisor, who
is a qualified person within the context of National Instrument
43-101.
On Behalf of the Board
"David Wolfin"
________________________________
David Wolfin
President & CEO
Avino Silver & Gold Mines
Ltd.
Safe Harbor Statement - This news release contains
"forward-looking information" and "forward-looking statements"
(together, the "forward looking statements") within the meaning of
applicable Canadian securities laws and the United States Private
Securities Litigation Reform Act of 1995, including, but are not
limited to, the Company's ability to meet its production guidance,
expectations of All-In Sustaining Cash Cost ("AISC"), information
on the updated mineral resource estimate for the Company's Avino
Property located near Durango in west-central Mexico (the "Property") with an effective date
of February 21, 2018, and amended on
December 19, 2018, prepared for the
Company, and reference to Measured, Indicated, Inferred Resources
referred to in this press release. These forward-looking statements
are made as of the date of this news release and the dates of
technical reports, as applicable. Readers are cautioned not to
place undue reliance on forward-looking statements, as there can be
no assurance that the future circumstances, outcomes or results
anticipated in or implied by such forward-looking statements will
occur or that plans, intentions or expectations upon which the
forward-looking statements are based will occur. While we have
based these forward-looking statements on our expectations about
future events as at the date that such statements were prepared,
the statements are not a guarantee that such future events will
occur and are subject to risks, uncertainties, assumptions and
other factors which could cause events or outcomes to differ
materially from those expressed or implied by such forward-looking
statements. No assurance can be given that the Company's Property
does not have the amount of the mineral resources indicated in the
updated report or that such mineral resources may be economically
extracted.
Such factors and assumptions include, among others, the
effects of general economic conditions, the price of gold, silver
and copper, changing foreign exchange rates and actions by
government authorities, uncertainties associated with legal
proceedings and negotiations and misjudgments in the course of
preparing forward-looking information. In addition, there are known
and unknown risk factors which could cause our actual results,
performance or achievements to differ materially from any future
results, performance or achievements expressed or implied by the
forward-looking statements. Known risk factors include risks
associated with project development; the need for additional
financing; operational risks associated with mining and mineral
processing; fluctuations in metal prices; title matters;
uncertainties and risks related to carrying on business in foreign
countries; environmental liability claims and insurance; reliance
on key personnel; the potential for conflicts of interest among
certain of our officers, directors or promoters with certain other
projects; the absence of dividends; currency fluctuations;
competition; dilution; the volatility of the our common share price
and volume; tax consequences to U.S. investors; and other risks and
uncertainties. Although we have 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 as 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. Accordingly,
readers should not place undue reliance on forward-looking
statements. We are under no obligation to update or alter any
forward-looking statements except as required under applicable
securities laws.
Cautionary Note Regarding Non-GAAP Measures
This news release includes certain terms or performance
measures commonly used in the mining industry that are not defined
under International Financial Reporting Standards ("IFRS"),
including silver equivalent ounces (AgEq oz) of production.
Non-GAAP measures do not have any standardized meaning prescribed
under IFRS and, therefore, they may not be comparable to similar
measures reported by other companies. We believe that, in addition
to conventional measures prepared in accordance with IFRS, certain
investors use this information to evaluate our performance. The
data presented 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. Readers
should also refer to our management's discussion and analysis
available under our corporate profile at www.sedar.com or on our
website at www.avino.com.
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SOURCE Avino Silver & Gold
Mines Ltd.