VANCOUVER, BC, Aug. 13, 2020
/CNW/ - Maverix Metals Inc. (the "Company" or "Maverix") (NYSE
American: MMX) (TSX: MMX) is pleased to announce its operating
and financial results for the second quarter ended June 30, 2020.
All amounts are in U.S. dollars unless otherwise indicated.
Second Quarter 2020 Highlights
- Record revenue of $11.0
million;
- Record cash flow from operating activities, excluding changes
in non-cash working capital, of $8.5
million1;
- Attributable gold equivalent ounces sold of
6,4121;
- Average cash cost per attributable gold equivalent ounce sold
of $139, resulting in cash operating
margins of $1,572 per
ounce1;
- Record net income of $3.1
million; and
- Received $15.6 million in cash
proceeds from the Pan American Silver warrant exercise.
Dan O'Flaherty, CEO of Maverix,
commented, "Maverix had a strong quarter with record revenue of
$11.0 million, a significant increase
of 57% compared to Q2 2019, demonstrating the strength and
diversity of our asset portfolio despite some of our assets being
affected by the impacts of the COVID-19 pandemic. With the rising
gold price environment, we are looking forward to the results for
the second half of the year and we continue to pursue opportunities
to grow our portfolio and increase shareholder value."
Summary of Quarterly Results
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Quarter
Ended
(in thousands of USD,
except for Attributable Gold Equivalent ounce and per share
amounts)
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June 30,
2020
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June 30,
2019
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Statement of
Income and Comprehensive Income
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|
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Royalty
revenue
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$
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7,784
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$
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4,418
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Sales
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$
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3,187
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$
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2,573
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Total
revenue
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$
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10,971
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$
|
6,991
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Cash flow from
operating activities
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$
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6,616
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$
|
5,343
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Net income
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$
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3,076
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$
|
610
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Basic earnings per
share
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$
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0.03
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$
|
0.01
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Dividends declared
per share
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$
|
0.01
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$
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0.00
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Non-IFRS and Other
Measures1
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Adjusted net
income
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$
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3,010
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$
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831
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Total Attributable
Gold Equivalent ounces sold
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6,412
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5,359
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Average realized gold
price per Total Attributable Gold Equivalent ounce sold
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$
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1,711
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$
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1,305
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Average cash cost per
Total Attributable Gold Equivalent ounce sold
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$
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139
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$
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156
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Cash flow from
operating activities, excluding changes in non-cash working
capital
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$
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8,479
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$
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4,050
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For complete details please refer to the Condensed Consolidated
Interim Financial Statements and associated Management Discussion
and Analysis for the quarter ended June 30,
2020, available on SEDAR (www.sedar.com), EDGAR
(www.sec.gov) or on the Company's website
(www.maverixmetals.com).
To listen to Maverix's President, Ryan
McIntyre, discuss the Company's strong second quarter
results please use this link: MMX Q2 Results
Dividend
The quarterly cash dividend of US$0.01 per common share will be paid on or about
September 15, 2020, to shareholders
of record as of the close of business on August 31, 2020.
This dividend is designated as an "eligible dividend" for the
purposes of the Income Tax Act (Canada). Dividends paid by Maverix to
shareholders outside Canada
(non-resident investors) will be subject to Canadian non-resident
withholding taxes. The declaration, timing, amount and payment of
future dividends remains at the discretion of the Company's Board
of Directors.
Asset Portfolio Updates
Moss (100% Silver Stream)
On August 6th, Northern
Vertex Mining Inc. ("Northern Vertex") announced record monthly
production in July of 4,713 gold equivalent ounces, including
37,171 silver ounces, the fourth consecutive monthly production
increase at the Moss mine located in Arizona. Production at the mine continues
uninterrupted with crusher and heap leach operation continuing to
exceed expectations with numerous daily production records. In
addition, throughput continues well above nameplate capacity. A
60,000 foot multi-phase drill program is currently underway to
identify high-grade ounces near the current pit and expand the
resource on strike from the Moss pit.
On August 12th,
Northern Vertex announced initial results from the multi-phase
drilling and resource expansion program. Drilling has successfully
intercepted high-grade gold and widespread district scale
mineralization within a 2 kilometre radius of mining operations,
including high-grade intercepts of 15.2 metres of 9.1 grams per
tonne ("g/t") gold and 86.0 g/t silver and 1.5 metres of 69.3 g/t
gold and 716 g/t silver at the Ruth Vein adjacent to the current
pit.
For more information, please refer to www.northernvertex.com and
see the Northern Vertex news release dated August 6, 2020 titled "Northern Vertex Reports
Record Monthly Production of 4,713 Gold Equivalent Ounces" and news
release dated August 12, 2020 titled
"Northern Vertex Intercepts High Grade Mineralization of 21.8 GPT
Gold & 211.48 GPT Silver Over 6.1 Meters, Including 69.3 GPT
(2.02 OZ) Gold & 716 GPT Silver Over 1.5 Meters at Moss Mine,
Arizona".
Florida Canyon (3% NSR Royalty)
On July 1st, Argonaut
Gold Inc. ("Argonaut") completed the acquisition of the Florida
Canyon mine located in Nevada
through its previously announced business combination with Alio
Gold Inc. On July 3rd,
Argonaut announced an updated life of mine plan for Florida Canyon
which outlined a 9.5 year mine life producing an average of 77,000
ounces of gold per annum.
For more information, please refer to www.argonautgold.com and
see the Argonaut Gold news release dated July 1, 2020 titled "Argonaut Gold and Alio Gold
Complete Merger to Create North American Diversified Intermediate
Gold Producer" and the news release dated July 3, 2020 titled "Argonaut Gold announces
Updated Life of Mine Plan for
Florida Canyon, Which Generates Approximately $326 Million of Mine Site After-Tax Free Cash
Flow at $1,700 Gold".
Nueva Esperanza (2% – 3% NSR Royalty)
On July 14th, Kingsgate
Consolidated Limited ("Kingsgate") announced that it had been
granted an Environmental Impact Assessment ("RCA-64/20") approval
for the Nueva Esperanza gold and silver project in the Atacama
region in Northern Chile. The RCA
64/20, combined with the existing water permit, effectively allows
the pre-development, construction and operation of the project. In
light of the continuing strong rises in gold and silver prices,
Kingsgate reported that there has been renewed interest in the
project from a number of parties and Kingsgate is currently
considering its options in this regard.
For more information, please refer to www.kingsgate.com.au and
see the Kingsgate news release dated July
14, 2020 titled "Environmental Impact Assessment (EIA)
Approved Nueva Esperanza Project, Chile".
Monument Bay (1.5% NSR Royalty)
On July 23rd, Yamana
Gold Inc. ("Yamana") announced the Monument Bay project, located in
Manitoba, is advancing with
internal technical and economic assessments considering the project
as an underground mine rather than an open pit mine. While
resources would be reduced from current levels, this would be an
economically attractive alternative with lower required capital
investment, a reduced environmental footprint and significant
exploration potential for increases in mineral resources down
plunge and in satellite surface areas. A new high-grade geological
model is being evaluated while several well-defined high-grade
zones along a 4 kilometre strike length of the deposit have been
identified. An expansion drill program on these targets is planned
to begin this year and extend into next year.
For more information, please refer to www.yamana.com and see the
Yamana news release dated July 23,
2020 titled "Yamana Gold Reports Second Quarter 2020
Financial Results; Strong Cash Flow Generation; a Further Reduction
of $101 Million in Net Debt; Jacobina
Phase 1 Expansion Complete; Increasing Dividend by a Further 12% to
$0.07 Per Share".
COVID-19 Update
The Company continues to monitor and assess the potential
impacts of COVID-19 on its employees and business. At this time,
employees continue to work remotely and there are no known cases of
COVID-19. The Company continues to closely monitor the impact of
the COVID-19 pandemic on its portfolio of assets.
The evolving and unpredictable impacts of the COVID-19 pandemic
resulted in the Company prudently withdrawing its 2020 attributable
gold equivalent ounce guidance on March 24,
2020. Maverix will continue to monitor the situation closely
and update the market as additional information becomes
available.
Appointment of New Vice President, Technical Services
Maverix is pleased to announce that Mr. Brendan Pidcock, P.Eng., has been promoted to
the role Vice President of Technical Services at Maverix effective
September 1st, 2020. Mr.
Pidcock has over 25 years of experience in mining spread over
multiple jurisdictions and commodities.
Mr. Pidcock will be succeeding Mr. Doug
Ward, who will be retiring from Maverix at the end of
August.
"The entire Maverix team would like to thank Doug for his
excellent contributions to the growth of Maverix", commented
Geoff Burns, Chairman of Maverix.
"His technical expertise and industry knowledge were invaluable in
the formation and development of the Company over its first 4 years
of operations. Doug played an integral role in forming Maverix and
was instrumental in many of the Company's transactions over the
past 4 years. We wish Doug all the best in his future endeavours
and look forward to continue building on the strong asset base he
has helped establish at Maverix".
"I want to thank Geoff and Dan for bringing me in and trusting
me with this opportunity from day one. Maverix has since assembled
an excellent and diversified cash flowing portfolio, with solid
growth prospects", commented Doug
Ward. "Again, I can't thank Maverix enough for the
opportunity to work with such a great team."
1 Maverix has included certain
performance measures in this news release that do not have any
standardized meaning prescribed by International Financial
Reporting Standards ("IFRS") including adjusted net income, total
Attributable Gold Equivalent ounces sold, average realized gold
price per Attributable Gold Equivalent ounce sold, average cash
cost per Attributable Gold Equivalent ounce sold, cash operating
margin and cash flow from operating activities, excluding changes
in non-cash working capital. Adjusted net income is calculated by
excluding the effects of other income/expenses, impairment charges,
gains/(losses) on sale of royalty and streams and unusual
non-recurring items. The Company believes that adjusted net income
is a useful measure of the Company's performance because it adjusts
for items which may not relate to or have a disproportionate effect
on the period in which they are recognized, impact the
comparability of our core operating results from period to period,
are not always reflective of the underlying operating performance
of our business and/or are not necessarily indicative of future
operating results. The Company's royalty revenue and silver sales
are converted to an Attributable Gold Equivalent ounce basis by
dividing the royalty revenue and silver sales for a period by the
average gold price based on the LBMA Gold Price PM Fix per ounce
for the same respective period. These Attributable Gold Equivalent
ounces when combined with the gold ounces sold from the Company's
gold streams (individually and collectively referred to as
"Attributable Gold Equivalent") equal total Attributable Gold
Equivalent ounces sold. Average realized gold price per
Attributable Gold Equivalent ounce sold is calculated by dividing
the total revenue by the Attributable Gold Equivalent ounces sold.
Average cash cost per Attributable Gold Equivalent ounce sold is
calculated by dividing the total cost of sales, less depletion, by
the Attributable Gold Equivalent ounces sold. In the precious
metals mining industry, these are common performance measures but
do not have any standardized meaning. Cash operating margin is
calculated by subtracting the average cash cost per Attributable
Gold Equivalent ounce sold from the average realized gold price per
Attributable Gold Equivalent ounce sold. 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 metal royalty and streaming sector
who present results on a similar basis. The Company has also used
the non-IFRS measure of operating cash flows excluding changes in
non-cash working capital. This measure is calculated by adding back
the decrease or subtracting the increase in changes in non-cash
working capital to or from cash provided by (used in) operating
activities. The presentation of these non-IFRS measures are
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.
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Qualified Person
Doug Ward, B.Sc., Mining
Engineering, MMSA, is Vice President Technical Services for
Maverix, and a qualified person under National Instrument 43-101 –
Standards of Disclosure for Mineral Projects, has reviewed
and approved the scientific and technical disclosure contained in
this press release.
About Maverix
Maverix is a gold-focused royalty and streaming company with a
globally diversified portfolio of over 100 assets. Maverix's
mission is to increase per share value by acquiring precious metals
royalties and streams. Its shares trade on both the NYSE American
and the TSX under the ticker "MMX".
Cautionary statements to U.S. investors
The financial information included or incorporated by reference
in this press release or the documents referenced herein has been
prepared in accordance with International Financial Reporting
Standards as issued by the International Accounting Standards
Board, which differs from US generally accepted accounting
principles ("US GAAP") in certain material respects, and thus are
not directly comparable to financial statements prepared in
accordance with US GAAP.
Information contained or referenced in this press release or in
the documents referenced herein concerning the properties,
technical information and operations of Maverix has been prepared
in accordance with requirements and standards under Canadian
securities laws, which differ from the requirements of US
securities laws. The terms "mineral resource", "measured mineral
resource", "indicated mineral resource" and "inferred mineral
resource" used in this press release or in the documents
incorporated by reference herein are mining terms as defined in
accordance with NI 43-101 under guidelines set out in the
Definition Standards for Mineral Resources and Mineral Reserves
adopted by the Canadian Institute of Mining, Metallurgy and
Petroleum Council on 11 December
2005. While the terms "mineral resource", "measured mineral
resource", "indicated mineral resource" and "inferred mineral
resource" are recognized and required by Canadian securities laws,
they are not recognized by SEC standards and normally are not
permitted to be used in reports filed with the SEC. Investors are
cautioned not to assume that all or any part of the disclosed
mineral resource estimates will ever be confirmed or converted into
reserves that meet the definitions used by the SEC.
Disclosure of contained ounces are or may be permitted disclosure
under regulations applicable to Maverix; however, the SEC normally
only permits issuers to report mineralization that does not
constitute "reserves" by SEC standards as in-place tonnage and
grade without reference to unit of production measures.
Accordingly, certain information contained in this press release or
in the documents incorporated by reference herein concerning
descriptions of mineralization and mineral resources under these
standards may not be comparable to similar information made public
by US companies subject to reporting and disclosure requirements of
the SEC.
Cautionary note regarding forward-looking statements
This release contains certain "forward looking statements" and
certain "forward-looking information" as defined under applicable
Canadian and U.S. securities laws. Forward-looking statements and
information can generally be identified by the use of
forward-looking terminology such as "may", "will", "should",
"expect", "intend", "estimate", "anticipate", "believe",
"continue", "plans" or similar terminology. The forward-looking
information contained herein is provided for the purpose of
assisting readers in understanding management's current
expectations and plans relating to the future. Readers are
cautioned that such information may not be appropriate for other
purposes. Forward-looking statements and information include, but
are not limited to, statements with respect to the Company's
financial guidance, outlook, the payment of the Company's dividend,
proposed plans for acquiring additional stream and royalty
interests and the potential of such streams and royalty interests
to provide returns and the completion of mine expansion under
construction phases at the mines or properties that the Company
holds an interest in. Forward-looking statements and information
are based on forecasts of future results, estimates of amounts not
yet determinable and assumptions that, while believed by management
to be reasonable, are inherently subject to significant business,
economic and competitive uncertainties and contingencies.
Forward-looking information is subject to known and unknown risks,
uncertainties and other factors that may cause the actual actions,
events or results to be materially different from those expressed
or implied by such forward-looking information, including but not
limited to: the impact of general business and economic conditions;
the absence of control over mining operations from which Maverix
will purchase gold and other metals or from which it will receive
royalty payments and risks related to those mining operations,
including risks related to international operations, government and
environmental regulation, delays in mine construction and
operations, actual results of mining and current exploration
activities, conclusions of economic evaluations and changes in
project parameters as plans continue to be refined; accidents,
equipment breakdowns, title matters, labor disputes or other
unanticipated difficulties or interruptions in operations; problems
inherent to the marketability of gold and other metals; the
inherent uncertainty of production and cost estimates and the
potential for unexpected costs and expenses; industry conditions,
including fluctuations in the price of the primary commodities
mined at such operations, fluctuations in foreign exchange rates
and fluctuations in interest rates; government entities
interpreting existing tax legislation or enacting new tax
legislation in a way which adversely affects Maverix; stock market
volatility; regulatory restrictions; liability, competition, the
potential impact of epidemics, pandemics or other public health
crises, including the current outbreak of the novel coronavirus
known as COVID-19 on Maverix's business, operations and financial
condition, loss of key employees, as well as those risk factors
discussed in the section entitled "Risk Factors" in Maverix's
annual information form dated March 23,
2020 available at www.sedar.com. Maverix 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 are advised not to place
undue reliance on forward-looking statements or information.
Maverix undertakes no obligation to update forward-looking
information except as required by applicable law. Such
forward-looking information represents management's best judgment
based on information currently available.
Technical and third-party information
The disclosure herein and relating to properties and operations
on the properties in which Maverix holds royalty, stream or other
interests is based on information publicly disclosed by the owners
or operators of these properties and information/data available in
the public domain as at the date hereof, and none of this
information has been independently verified by Maverix.
Specifically, as a royalty or stream holder, Maverix has limited,
if any, access to properties included in its asset portfolio.
Additionally, Maverix may from time to time receive operating
information from the owners and operators of the properties, which
it is not permitted to disclose to the public. Maverix is dependent
on, (i) the operators of the properties and their qualified persons
to provide information to Maverix, or (ii) on publicly available
information to prepare disclosure pertaining to properties and
operations on the properties on which Maverix holds royalty, stream
or other interests, and generally has limited or no ability to
independently verify such information. Although Maverix does not
have any knowledge that such information may not be accurate, there
can be no assurance that such third-party information is complete
or accurate. Some information publicly reported by operators may
relate to a larger property than the area covered by Maverix's
royalty, stream or other interest. Maverix's royalty, stream or
other interests often cover less than 100% and sometimes only a
portion of the publicly reported mineral reserves, mineral
resources and production of a property.
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SOURCE Maverix Metals Inc.