FOURTH QUARTER FREE CASH FLOW OF
$157 MILLION AND
ADJUSTED ATTRIBUTABLE EPS OF $0.50 PER SHARE
DENVER, Feb. 17, 2021 /PRNewswire/ - SSR Mining Inc.
(NASDAQ: SSRM) (TSX: SSRM) (ASX: SSR) ("SSR Mining" or "the
Company") reports consolidated financial results for the fourth
quarter and year ended December 31, 2020.
Rod Antal, President and CEO
said, "We exited 2020 with strong operational and financial
momentum across all four of our operating assets. The fourth
quarter represented the first full quarter following the completion
of the Alacer merger, and the results demonstrated the strength of
the business with 220,000 gold-equivalent ounces produced at
$976 per ounce AISC and $157 million in free cash flow. Given our strong
balance sheet we declared our first quarterly dividend in line with
our recently instituted capital allocation policy. Our peer leading
free cash flow will also provide us the opportunity to assess
additional capital returns to shareholders in the form of
supplemental dividends and/or share buy-back programs in the
future.
In 2021, we remain focused on execution and delivery with the
goal of demonstrating our organic ability to sustain 700,000 to
800,000 gold-equivalent ounces of production for the next 5+ years.
Our large brownfield growth and exploration pipeline will take
center-stage this year as we advance projects and provide clarity
on their potential scale and timelines."
Fourth Quarter and Year-End 2020 Highlights:
(All
figures are in U.S. dollars unless otherwise noted)
- Closed zero-premium merger with Alacer: On September 16, 2020, completed the transaction
with Alacer to create a leading intermediate precious metals
producer with robust margins, strong free cash flow generation and
long mine lives led by a highly experienced leadership team with a
track record of value creation.
- Robust free cash flow: Reported fourth quarter
attributable net income of $89.0
million, or $0.41 per share,
and adjusted attributable net income of $108.8 million, or $0.50 per share. Generated cash flows from
operating activities of $217.4
million and free cash flow of $157.0
million in the fourth quarter.(1)
- Record fourth quarter performance: Delivered fourth
quarter production of 220,432 gold equivalent ounces at AISC of
$976 per gold equivalent ounce,
exiting the year with strong operational momentum.(1)
- Enhanced balance sheet and liquidity: Cash and cash
equivalents and consolidated cash balances at year-end increased to
$860.6 million and $897.0 million, respectively, further
strengthening the Company's peer-leading balance
sheet.(1) Cash and cash equivalents increased by
$127.1 million during the fourth
quarter.
- Inaugural dividend announced: The Board declared the
first quarterly cash dividend of $0.05 per share.
- Delivered positive Çöpler District Master Plan studies:
Released an updated NI 43-101 technical report outlining two
production scenarios which demonstrate the long-term value and the
significant organic growth potential of this world-class
operation.
- Discovered C2 copper-gold porphyry target at Çöpler:
Announced positive results from four diamond drill holes below the
Çöpler pit, with all holes intersecting gold-rich copper porphyry
mineralization. The C2 results are another example of the long-term
potential of Çöpler.
- Çöpler contributes low-cost production: Delivered gold
production of 83,029 ounces in the fourth quarter and annual
production of 326,908 ounces.(2) Reported AISC of
$748 per ounce in the fourth quarter,
generating robust margins.(1)
- Record production at Marigold: Delivered gold production
of 76,941 ounces for the fourth quarter and annual production of
234,443 ounces, marking both quarterly and annual production
records for the operation.
- Marigold recognized for operator safety: The Marigold
team was awarded first place by the Nevada Mining Association for
safety for large metal operator in 2020.
- Steady-state production at Seabee: Produced 31,915
ounces of gold at AISC of $787 per
ounce in the fourth quarter as the mine returned to steady-state
operations.(1)
- Strong performance at Puna: Produced 2.2 million ounces
of silver at cash costs of $8.92 per
ounce in the fourth quarter.(1) AISC of $15.90 per ounce was impacted by sales well below
production due to lags as concentrate shipments
resumed.(1)
- Provided robust 2021 outlook: In 2021, the Company
expects to produce, on a consolidated basis, 720,000 to 800,000
gold-equivalent ounces at consolidated AISC of $1,050 to $1,110
per gold equivalent ounce.(1)
(1)
|
SSR Mining reports
the non-GAAP financial measures of all-in sustaining costs ("AISC")
per ounce of gold, silver and gold equivalent sold, adjusted
attributable net income, adjusted attributable net income per
share, free cash flow and consolidated cash to manage and evaluate
the Company's operating performance. See "Non-GAAP Financial
Measures" in Section 13.
|
(2)
|
Includes full year
2020 production from Çöpler. SSR Mining is not entitled to the
economic benefits from Çöpler prior to acquisition.
|
Çöpler, Turkey
(amounts presented on 100%
basis)
|
Three months
ended
December 31
|
Period from
acquisition to
December 31, 2020
|
Year ended
December
31
|
Operating
Data
|
2020
|
2020
(1)
|
2020
(2)
|
Gold produced - oxide
(oz)
|
21,200
|
26,458
|
87,548
|
Gold produced -
sulfide (oz)
|
61,830
|
76,158
|
239,360
|
Total gold produced
(oz)
|
83,029
|
102,616
|
326,908
|
Gold sold
(oz)
|
80,388
|
108,283
|
321,272
|
|
|
|
|
Ore mined - oxide
(kt)
|
1,354
|
1,501
|
2,823
|
Ore mined - sulfide
(kt)
|
935
|
1,034
|
2,255
|
Total material mined
(kt)
|
7,045
|
8,108
|
25,861
|
Waste removed
(kt)
|
4,756
|
5,573
|
20,783
|
Strip
ratio
|
2.1
|
2.2
|
4.1
|
|
|
|
|
Ore stacked - oxide
(kt)
|
1,292
|
1,413
|
2,841
|
Gold grade stacked -
oxide (g/t)
|
1.20
|
1.20
|
1.13
|
|
|
|
|
Ore processed -
sulfide (kt)
|
584
|
669
|
2,158
|
Gold grade processed
- sulfide (g/t)
|
3.61
|
3.62
|
3.74
|
Gold recovery -
sulfide (%)
|
90.3
|
90.1
|
90.7
|
|
|
|
|
Average realized gold
price ($/oz sold)
|
$
|
1,876
|
$
|
1,887
|
$
|
1,763
|
|
|
|
|
Cash costs ($/oz gold
sold) (3, 4)
|
$
|
619
|
$
|
614
|
$
|
625
|
AISC ($/oz gold sold)
(3, 4)
|
$
|
748
|
$
|
743
|
$
|
752
|
|
|
|
|
Financial Data
($000s)
|
|
|
|
Revenue
|
$
|
151,970
|
$
|
205,536
|
N/A
|
Production
costs
|
$
|
79,948
|
$
|
120,618
|
N/A
|
Depletion and
depreciation
|
$
|
25,158
|
$
|
34,053
|
N/A
|
Income from mine
operations
|
$
|
46,864
|
$
|
50,865
|
N/A
|
Exploration and
evaluation expenses
|
$
|
2,605
|
$
|
3,558
|
N/A
|
Capital
expenditures
|
$
|
18,463
|
$
|
22,883
|
N/A
|
|
|
(1)
|
The data presented in
this column is for the period from September 16, 2020 to December
31, 2020, the period for which the Company was entitled to all
economic benefits of Çöpler following the Company's acquisition of
Alacer.
|
(2)
|
The operating data
presented in this column includes operating results for Çöpler for
the entire year ended December 31, 2020, including the period prior
to the Company's acquisition of Alacer on September 16, 2020. As
the Company was not entitled to the economic benefits of Çöpler
prior to the acquisition, financial data for the periods prior to
September 16, 2020 are not provided.
|
(3)
|
The Company reports
the non-GAAP financial measures of cash costs and AISC per ounce of
gold sold to manage and evaluate operating performance at Çöpler.
For further information, please refer to Non-GAAP Financial
Measures" in Section 13.
|
(4)
|
Cash costs and AISC
per ounce of gold sold exclude the impact of any fair value
adjustment on acquired inventories as at the date of the Company's
acquisition of Alacer.
|
Production
During the fourth quarter of 2020, Çöpler produced 83,029 ounces
of gold, which included 21,200 ounces of gold production from the
Çöpler oxide plant and 61,830 ounces of gold production from the
sulfide plant. Production was in line with guidance despite the
impacts of COVID-19. The mine plan was revised and other actions
taken to mitigate the impacts of COVID-19.
From September 16, 2020, the date
of the Company's acquisition of Alacer, to December 31, 2020, Çöpler produced 102,616 ounces
of gold, which included 26,458 ounces of gold production from the
Çöpler oxide plant and 76,158 ounces of gold production from the
sulfide plant.
For the year ended December 31,
2020, Çöpler produced 326,908 ounces of gold, which included
87,548 ounces of gold production from the Çöpler oxide plant and
239,360 ounces of gold production from the sulfide plant.
Production was in line with the revised mine plan that was adopted
to diversify ore sources and optimize production in light of the
shortfall in mine operator numbers resulting from COVID-19.
For the three months and year ended December 31, 2020, oxide ore tonnes mined were
1.4 million and 2.8 million tonnes, respectively. The oxide ore
mined grade was 1.16 g/t and 1.06 g/t, respectively.
For the three months and year ended December 31, 2020, sulfide ore tonnes mined were
0.9 million and 2.3 million tonnes, respectively, in line with the
revised mine plan.
For the three months and year ending December 31, 2020, the sulfide plant treated 0.6
million and 2.2 million tonnes of sulfide ore, respectively. The
sulfide plant continued to efficiently operate above design
throughput. Plant gold recovery averaged approximately 91% for the
year ended December 31, 2020.
Recovery improvement projects continued in the fourth quarter of
2020, some of which continue into 2021.
Mine operator availability suffered in 2020 due to COVID-19
restrictions. The revised mine plan reduced the haulage of material
to the tailings storage facility ("TSF"), stockpiling this material
for 2021, and allowed for available mining resources to be focused
on the Manganese pit cutback. The TSF is approximately 5 kilometers
from the mine and is constructed from competent mine waste. Despite
the reduced construction rate in 2020 as a result of the impacts
from COVID-19, the TSF is advancing ahead of operational
requirements. A mining area was also brought into production in the
Main Pit to diversify ore sources, in part, as a risk management
strategy should COVID-19 related restrictions increase. Total mined
tonnes for the fourth quarter and full year 2020, with the revised
mine plan, were above the original mine plan.
For the three months and year ended December 31, 2020, the total waste tonnes mined
were 4.8 million and 20.8 million tonnes, respectively, in line
with the revised mine plan.
The Çöpler District Master Plan 2020 ("CDMP2020"), issued in
November 2020, updated the operating
parameters of the sulfide plant and includes the results of
optimization studies and programs, including the supplemental
flotation circuit.
The flotation circuit included in the recent amendment to the
Çöpler Environmental Impact Assessment application and incorporated
into the CDMP2020 was approved for construction by the Board of
Directors. The flotation circuit will treat a side stream from the
grinding circuit, with the concentrate reporting to autoclave feed
and the tails to leaching. The flotation circuit is anticipated to
increase the gold and sulfur grades processed through the
autoclaves (increasing autoclave and oxygen utilization), reduce
unit costs, and increase total sulfide plant throughput and gold
production. Overall recovery declines modestly due to lower float
tails recovery. The currently-installed grinding mills have
demonstrated significant latent capacity, sufficient to support an
increase in sulfide plant throughput capacity up to approximately 3
million tonnes per annum. The capital cost estimate for the
flotation circuit is approximately $18
million. At December 31, 2020,
the detailed engineering designs for the flotation circuit were 89%
complete and the civil construction was 95% complete. The
fabrication of the steel work is in progress, with tank delivery at
75% and assembly at 55% completion. The flotation circuit
commissioning is targeted for mid-year 2021.
Revenue
Revenue for the fourth quarter of 2020 was $152.0
million as 80,388 ounces of gold were sold at an average
realized gold price of $1,876 per ounce.
Revenue for the period from September 16,
2020, the date of the Company's acquisition of Alacer, to
December 31, 2020, was $205.5
million as 108,283 ounces of gold were sold at an average
realized gold price of $1,887 per ounce.
Gold ounces sold in the fourth quarter of 2020 were lower than
production due to the timing of gold pours at year end. Gold ounces
sold from the date of acquisition to December 31, 2020 were higher than production due
to the sale of finished goods inventory acquired on the acquisition
date.
Operating Costs
Cash costs and AISC per ounce of gold sold are non-GAAP
financial measures. Please see the discussion under "Non-GAAP
Financial Measures" in Section 13.
Unit operating costs remained stable as a weaker local currency
offset by the impacts associated with COVID-19. The impact of fair
value adjustments on acquired inventories and mineral interests are
reflected in production costs and depletion and depreciation,
respectively. These impacts have been removed in the calculation of
cash costs and AISC per ounce of gold sold (refer to Section
13).
In the fourth quarter of 2020, cash costs per ounce of gold sold
were $619. Royalty expense included
in cash costs increased due to a combination of higher rate and
higher gold prices.
In the fourth quarter of 2020, AISC per ounce of gold sold was
$748, which was also affected by
increased royalty expense.
Marigold, USA
|
Three months ended
December 31,
|
Year ended
December 31,
|
Operating
Data
|
2020
|
2019
|
Change
|
2020
|
2019
|
Change
|
Gold produced
(oz)
|
76,941
|
59,186
|
30%
|
234,443
|
220,227
|
6%
|
Gold sold
(oz)
|
73,927
|
61,088
|
21%
|
230,043
|
226,957
|
1%
|
|
|
|
|
|
|
|
Total material mined
(kt)
|
22,699
|
18,457
|
23%
|
85,594
|
74,039
|
16%
|
Waste removed
(kt)
|
15,946
|
11,736
|
36%
|
62,038
|
48,364
|
28%
|
Total ore stacked
(kt)
|
6,753
|
6,721
|
—%
|
23,556
|
25,676
|
(8)%
|
Gold stacked grade
(g/t)
|
0.48
|
0.36
|
33%
|
0.39
|
0.40
|
(3)%
|
Strip
ratio
|
2.4
|
1.7
|
41%
|
2.6
|
1.9
|
37%
|
|
|
|
|
|
|
|
Average realized gold
price ($/oz sold)
|
$
|
1,885
|
$
|
1,478
|
28%
|
$
|
1,783
|
$
|
1,391
|
28%
|
|
|
|
|
|
|
|
Cash costs ($/oz gold
sold) (1)
|
$
|
838
|
$
|
778
|
8%
|
$
|
852
|
$
|
811
|
5%
|
AISC ($/oz gold sold)
(1)
|
$
|
1,070
|
$
|
1,117
|
(4)%
|
$
|
1,222
|
$
|
1,034
|
18%
|
|
|
|
|
|
|
|
Financial Data
($000s)
|
|
|
|
|
|
|
Revenue
|
$
|
139,183
|
$
|
90,198
|
54%
|
$
|
409,798
|
$
|
315,320
|
30%
|
Production
costs
|
$
|
62,228
|
$
|
47,472
|
31%
|
$
|
196,409
|
$
|
183,782
|
7%
|
Depletion and
depreciation
|
$
|
15,752
|
$
|
12,463
|
26%
|
$
|
47,844
|
$
|
52,291
|
(9)%
|
Income from mine
operations
|
$
|
61,203
|
$
|
30,263
|
102%
|
$
|
165,545
|
$
|
79,247
|
109%
|
Exploration and
evaluation expenses
|
$
|
427
|
$
|
319
|
34%
|
$
|
2,462
|
$
|
936
|
163%
|
Capital
expenditures
|
$
|
15,833
|
$
|
20,754
|
(24)%
|
$
|
80,161
|
$
|
53,702
|
49%
|
|
|
(1)
|
The Company reports
the non-GAAP financial measures of cash costs and AISC per ounce of
gold sold to manage and evaluate operating performance at Marigold.
For further information, please refer to "Non-GAAP Financial
Measures" in Section 13.
|
Production
In the fourth quarter of 2020, 22.7 million tonnes of material
were mined, a 23% increase compared to the fourth quarter of 2019.
For the year ended December 31, 2020,
85.6 million tonnes of material were mined, a 16% increase over the
year ended December 31, 2019. These
increases are attributable to shorter haulage cycles coupled with
increased fleet capacities in load, haul and drilling.
During the fourth quarter of 2020, 6.8 million tonnes of ore was
stacked at a gold grade of 0.48 g/t. This compares to 6.7 million
tonnes of ore stacked at a gold grade of 0.36 g/t in the fourth
quarter of 2019. The higher grades delivered in the fourth quarter
of 2020 as compared to the fourth quarter 2019 are associated with
the planned mining of the higher-grade portions of Mackay 4 and
Mackay 8. In the fourth quarter of 2019, mining activities focused
on the lower grade portions of Mackay 5 and stripping of Mackay
4.
For the year ended December 31,
2020, 23.6 million tonnes of ore was stacked at a gold grade
of 0.39 g/t compared to 25.7 million tonnes of ore stacked at a
gold grade of 0.40 g/t for the year ended December 31, 2019. The reduction in both ore
tonnes stacked and gold grade are associated with the transition
from mining higher grade Mackay 5 ore in 2019 to the stripping and
mining of Mackay Phases 4 and 8 in 2020.
During the fourth quarter of 2020, Marigold produced a quarterly
record 76,941 ounces of gold, an increase of 30% compared to the
fourth quarter of 2019 and 15% higher than the previous quarterly
record. Production benefited from higher grades stacked at lower
lifts on the heap leach pads. A decrease in electrowinning cell
inventory also contributed to ounces produced in the fourth quarter
of 2020.
Annual production in 2020 of 234,443 ounces was a record for the
mine's 32-year history. This was 6% higher than the 220,227 ounces
of gold for the year ended December 31,
2019. The increase was due to low stacking elevations
throughout 2020 which contributed to faster leach times and a
decrease in electrowinning cell inventory during 2020.
Revenue
Revenue increased by 54% to $139.2
million in the fourth quarter of 2020 compared to the fourth
quarter of 2019, due to a 28% increase in the average realized gold
price and 21% more ounces sold.
Revenue increased by 30% for the year ended December 31, 2020 compared to the year ended
December 31, 2019, due to an increase
of 28% in the average realized gold price.
Gold ounces sold in the fourth quarter and for the year ended
December 31, 2020 were lower than
production due to the timing of gold pours at year end.
Operating Costs
Cash costs and AISC per ounce of gold sold are non-GAAP
financial measures. Please see the discussion under "Non-GAAP
Financial Measures" in Section 13.
Cash costs per ounce of gold sold for the fourth quarter of 2020
was $838, an 8% increase compared to
the fourth quarter of 2019, primarily due to an increase in per
unit royalty costs due to higher realized gold prices. Cash costs
per ounce of gold sold for the full year 2020 were $852, a 5% increase compared to the full year
2019 for the same reason.
In the fourth quarter of 2020, AISC per ounce of gold sold was
$1,070, a 4% decrease compared to the
fourth quarter of 2019, due to lower capital expenditures per gold
ounce sold partially offset by higher cash costs. Capital spend was
lower in the fourth quarter of 2020 primarily due to the purchase
of a hydraulic shovel in the fourth quarter of 2019 with no
comparable purchase in 2020.
AISC per ounce of gold sold for the year ended December 31, 2020 was $1,222, an 18% increase compared to the year
ended December 31, 2019 due to higher
cash costs and an increase in capital expenditures per gold ounce
sold. Capital expenditures were higher than the year ended
December 31, 2019, due to mobile mine
equipment replacements, increased leach pad construction,
dewatering construction costs and higher deferred stripping.
Seabee, Canada
|
Three months ended
December 31,
|
Year ended
December 31,
|
Operating
Data
|
2020
|
2019
|
Change
|
2020
|
2019
|
Change
|
Gold produced
(oz)
|
31,915
|
22,069
|
45%
|
81,686
|
112,137
|
(27)%
|
Gold sold
(oz)
|
28,013
|
24,362
|
15%
|
75,837
|
104,915
|
(28)%
|
|
|
|
|
|
|
|
Total ore milled
(t)
|
99,487
|
87,394
|
14%
|
255,178
|
344,039
|
(26)%
|
Ore milled per day
(t/day)
|
1,081
|
950
|
14%
|
697
|
943
|
(26)%
|
Gold mill feed grade
(g/t)
|
9.85
|
7.89
|
25%
|
10.10
|
9.56
|
6%
|
Gold recovery
(%)
|
98.4
|
97.9
|
1%
|
98.4
|
98.2
|
—%
|
|
|
|
|
|
|
|
Average realized gold
price ($/oz sold)
|
$
|
1,877
|
$
|
1,484
|
26%
|
$
|
1,790
|
$
|
1,398
|
28%
|
|
|
|
|
|
|
|
Cash costs ($/oz
sold) (1)
|
$
|
531
|
$
|
505
|
5%
|
$
|
534
|
$
|
464
|
15%
|
AISC ($/oz sold)
(1)
|
$
|
787
|
$
|
751
|
5%
|
$
|
939
|
$
|
812
|
16%
|
|
|
|
|
|
|
|
Financial Data
($000s)
|
|
|
|
|
|
|
Revenue
|
$
|
52,498
|
$
|
36,142
|
45%
|
$
|
135,230
|
$
|
146,141
|
(7)%
|
Production
costs
|
$
|
15,583
|
$
|
12,283
|
27%
|
$
|
41,308
|
$
|
48,470
|
(15)%
|
Depletion and
depreciation
|
$
|
11,148
|
$
|
10,124
|
10%
|
$
|
28,233
|
$
|
36,368
|
(22)%
|
Income from mine
operations
|
$
|
25,767
|
$
|
13,735
|
88%
|
$
|
65,689
|
$
|
61,303
|
7%
|
Exploration and
evaluation expenses
|
$
|
2,088
|
$
|
1,210
|
73%
|
$
|
6,108
|
$
|
8,770
|
(30)%
|
Capital
expenditures
|
$
|
8,201
|
$
|
5,946
|
38%
|
$
|
33,758
|
$
|
33,559
|
1%
|
|
|
(1)
|
The Company reports
the non-GAAP financial measures of cash costs and AISC per ounce of
gold sold to manage and evaluate operating performance at Seabee.
For further information, please refer to "Non-GAAP Financial
Measures" in Section 13.
|
Production
In response to the COVID-19 pandemic, Seabee was voluntarily
placed into temporary care and maintenance on March 25, 2020 as a precautionary measure to
protect the Company's employees, their families and communities.
Through this period, employees maintained the mine in a state of
operational readiness.
In June 2020, a phased restart of
the operation commenced. The first phase focused on underground
ventilation raises and capital development within the mine while
COVID-19-related protocols were assessed. Limited ore extraction
was initiated at the end of June. In early July, Seabee commenced
the second phase, which involved increasing underground development
rates and mine production while continuing to monitor COVID-19
related protocols. In August, the third and final phase commenced,
which involved a restart of milling operations and ramp-up to full
mine production with a complete workforce, while continuing to
maintain effective COVID-19-related protocols. The mine has
operated at full capacity since completion of the final phase in
August.
During the fourth quarter of 2020, Seabee produced 31,915 ounces
of gold, a 45% increase compared to the fourth quarter of 2019, due
to increases in tonnes and grade mined and milling of stockpiled
ore. Mill feed grade was 9.85 g/t gold during the fourth quarter of
2020, a 25% increase compared to the fourth quarter of 2019, due to
the scheduled sequencing of the mine.
For the year ended December 31,
2020, Seabee produced 81,686 ounces of gold, a 27% decrease
compared to the year ended December 31,
2019, reflecting that the mill was shut down from March
through August 2020, whereas the mill
was fully operational in 2019.
Revenue
Revenue increased by 45% in the fourth quarter of 2020 compared
to the fourth quarter of 2019 due to a 15% increase in gold ounces
sold and a 26% increase in the average realized gold price.
Revenue decreased by 7% for the year ended December 31, 2020 compared to the year ended
December 31, 2019, due to a 28%
decrease in gold ounces sold, partially offset by a 28% increase in
the average realized gold price. The decrease in gold ounces sold
is due to the temporary suspension of operations as a result of
COVID-19.
Gold ounces sold in the fourth quarter and for the year ended
December 31, 2020 were lower than
production due to the timing of shipments of gold on carbon fines
and the timing of gold pours at year end.
Operating Costs
Cash costs and AISC per ounce of gold sold are non-GAAP
financial measures. Please see the discussion under "Non-GAAP
Financial Measures" in Section 13.
In the fourth quarter of 2020, cash costs per ounce of gold sold
were $531, a 5% increase compared to
the fourth quarter of 2019, due to higher general and
administrative costs associated with the ramp up to full
production.
In the fourth quarter of 2020, AISC per ounce of gold sold was
$787, a 5% increase compared to the
fourth quarter of 2019, due to higher cash costs. Capital
expenditures in the fourth quarter of 2020 related mainly to the
tailings expansion project. Full construction activities at the
tailings expansion project resumed in early August 2020.
For the year ended December 31,
2020, cash costs per ounce of gold sold were $534, a 15% increase compared to the year ended
December 31, 2019, due to higher unit
mining and general and administrative costs, driven by the
temporary suspension of operations for all of the second quarter
and beginning of the third quarter.
For the year ended December 31,
2020, AISC per ounce of gold sold was $939, a 16% increase compared to the year ended
December 31, 2019, due to higher cash
costs.
Puna, Argentina
(amounts presented on 100%
basis)
|
Three months ended
December 31,
|
Year ended
December 31,
|
Operating
Data
|
2020
|
2019
|
Change
|
2020
|
2019
|
Change
|
Silver produced ('000
oz)
|
2,165
|
2,132
|
2%
|
5,581
|
7,674
|
(27)%
|
Silver sold ('000
oz)
|
1,010
|
2,584
|
(61)%
|
4,661
|
7,695
|
(39)%
|
Lead produced ('000
lb) (1)
|
6,529
|
7,985
|
(18)%
|
17,193
|
23,957
|
(28)%
|
Lead sold ('000 lb)
(1)
|
3,158
|
9,371
|
(66)%
|
14,903
|
24,119
|
(38)%
|
Zinc produced ('000
lb) (1)
|
2,932
|
3,007
|
(2)%
|
6,988
|
8,392
|
(17)%
|
Zinc sold ('000 lb)
(1)
|
1,898
|
3,067
|
(38)%
|
6,039
|
14,072
|
(57)%
|
|
|
|
|
|
|
|
Total material mined
(kt)
|
2,750
|
3,244
|
(15)%
|
5,696
|
12,282
|
(54)%
|
Waste removed
(kt)
|
2,440
|
2,725
|
(10)%
|
4,879
|
10,839
|
(55)%
|
Strip
ratio
|
7.9
|
5.3
|
49%
|
6.0
|
7.5
|
(20)%
|
|
|
|
|
|
|
|
Ore milled
(kt)
|
416
|
400
|
4%
|
1,118
|
1,394
|
(20)%
|
Silver mill feed
grade (g/t)
|
170
|
174
|
(2)%
|
164
|
184
|
(11)%
|
Lead mill feed grade
(%)
|
0.78
|
0.99
|
(21)%
|
0.77
|
0.89
|
(13)%
|
Zinc mill feed grade
(%)
|
0.52
|
0.63
|
(17)%
|
0.51
|
0.54
|
(6)%
|
Silver recovery
(%)
|
95.2
|
95.1
|
—%
|
94.6
|
93.2
|
2%
|
Lead recovery
(%)
|
90.8
|
91.9
|
(1)%
|
90.2
|
85.8
|
5%
|
Zinc recovery
(%)
|
61.4
|
54.3
|
13%
|
55.5
|
49.2
|
13%
|
|
|
|
|
|
|
|
|
Average realized
silver price ($/oz)
|
$
|
24.78
|
$
|
17.32
|
43%
|
$
|
21.23
|
$
|
16.26
|
31%
|
|
|
|
|
|
|
|
Cash costs ($/oz
silver sold) (2)
|
$
|
8.92
|
$
|
8.90
|
—%
|
$
|
11.43
|
$
|
10.38
|
10%
|
AISC ($/oz silver
sold) (2)
|
$
|
15.90
|
$
|
11.18
|
42%
|
$
|
15.22
|
$
|
14.06
|
8%
|
|
|
|
|
|
|
Financial Data
($000s)
|
|
|
|
|
|
Revenue
|
$
|
27,078
|
$
|
51,263
|
(47)%
|
$
|
102,525
|
$
|
145,389
|
(29)%
|
Production
costs
|
$
|
11,822
|
$
|
29,424
|
(60)%
|
$
|
60,317
|
$
|
97,558
|
(38)%
|
Depreciation and
depletion
|
$
|
2,634
|
$
|
6,924
|
(62)%
|
$
|
15,665
|
$
|
17,498
|
(10)%
|
Income from mine
operations
|
$
|
12,622
|
$
|
14,915
|
(15)%
|
$
|
26,543
|
$
|
30,333
|
(12)%
|
Exploration,
evaluation and reclamation expense
|
$
|
(2,337)
|
$
|
492
|
(575)%
|
$
|
(2,144)
|
$
|
786
|
(373)%
|
Capital
expenditures
|
$
|
6,480
|
$
|
5,557
|
17%
|
$
|
17,690
|
$
|
33,819
|
(48)%
|
|
|
(1)
|
Data for lead
production and sales relate only to lead in lead concentrate. Data
for zinc production and sales relate only to zinc in zinc
concentrate.
|
(2)
|
The Company reports
the non-GAAP financial measures of cash costs and AISC per ounce of
silver sold to manage and evaluate operating performance at Puna.
For further information, please refer to "Non-GAAP Financial
Measures" in Section 13.
|
Production
On March 20, 2020, Puna
temporarily suspended operations as a result of government-mandated
restrictions due to the COVID-19 pandemic. Subsequently, the
Government of Argentina reinstated
mining as an essential business activity. During the second quarter
of 2020, a phased restart complying with government regulations and
guidelines was implemented with the recommencement of mining,
hauling and milling operations. During the third quarter of 2020,
COVID-19 infection rates in the Province of Jujuy escalated,
resulting in further interruptions to operations. In September,
operations were suspended in order to manage camp occupancy,
conduct testing and reduce the risk of transmission. Due to the
significant ore stockpiles at Puna, milling operations were
prioritized over mining operations through restarts. As a result,
tonnes mined in the third quarter of 2020 were impacted due to
COVID-19 related interruptions. Mining and milling activities were
operating at expected levels by the beginning of October 2020.
During the fourth quarter of 2020, Puna produced 2.2
million ounces of silver, a 2% increase compared to the fourth
quarter of 2019, due to higher tonnage milled at modestly lower
grades. Lead and zinc production decreased 18% and 2% respectively,
due to lower base metal head grades with zinc benefiting from a
significant increase in recovery due to achieving finer ore
grind. Ore milled was 0.4 million tonnes, a 4% increase
compared to the fourth quarter of 2019 due to an increase in
throughput and shorter shutdowns for scheduled
maintenance. Processed ore contained an average silver grade
of 170 g/t, a 2% decrease compared to the fourth quarter of 2019,
which was in-line with the mine plan. The mill averaged
approximately 4,517 tonnes per day during the fourth quarter of
2020, demonstrating an improved performance on plant throughput and
tailings pumping system capacity achieved through continuous
improvements.
For the year ended December 31,
2020, Puna produced 5.6 million ounces of silver, a 27%
decrease compared to the year ended December
31, 2019, due to the temporary suspension of operations in
response to COVID-19 during the second and third quarters of 2020.
Lead and zinc production was similarly affected by the COVID-19
related shutdowns. Ore milled was 1.1 million tonnes, a 20%
decrease compared to the year ended December
31, 2019, also as a result of COVID-19 related shutdowns.
Processed ore contained an average silver grade of 164 g/t, an 11%
decrease compared to the year ended December
31, 2019, but in-line with the mine plan.
Revenue
Revenue decreased by 47% in the fourth quarter of 2020 compared
to the fourth quarter of 2019, due to a 61% decrease in silver
ounces sold, partially offset by a 43% increase in the average
realized silver price. Sales in the fourth quarter and for the year
ended December 31, 2020 were
significantly below production due to the normal transport and
refining cycles associated with ramp-up after the COVID-19 related
shutdowns.
Revenue decreased by 29% for the year ended December 31, 2020 compared to the year ended
December 31, 2019, due to a 39%
decrease in silver ounces sold as a result of the COVID-19
operational shutdowns, partially offset by a 31% increase in the
average realized silver price.
Operating Costs
Cash costs and AISC per ounce of silver sold are non-GAAP
financial measures. Please see the discussion under "Non-GAAP
Financial Measures" in Section 13.
In the fourth quarter of 2020, cash costs per ounce of silver
sold were $8.92, consistent with the
fourth quarter of 2019.
In the fourth quarter of 2020, AISC per ounce of silver sold was
$15.90, an increase of 42% compared
to the fourth quarter of 2019. The increase in AISC was primarily
due to higher capital expenditures per silver ounce sold, driven by
silver ounces sold well below production due to normal ramp-up
times for shipping and selling concentrates.
For the year ended December 31,
2020, cash costs per ounce of silver sold were $11.43, an increase of 10% compared to the year
ended December 31, 2019, primarily
due to higher mining unit costs, offset by lower processing and
general and administrative unit costs as a result of higher average
daily plant throughput and the positive impact of the renegotiation
of the natural gas contract. Mining costs were higher due to
operating inefficiencies through shutdown and start-up phases and
an increase in maintenance work performed during the temporary
suspensions.
For the year ended December 31,
2020, AISC per ounce of silver sold was $15.22, an increase of 8% compared to the year
ended December 31, 2019, due to
higher cash costs per ounce sold, offset partially by lower
sustaining capital expenditures, mainly due to lower deferred
stripping costs and the deferral of capital projects due to impacts
of COVID-19.
Exploration and Development
The Company holds a portfolio of prospective exploration tenures
across Turkey, the USA, Canada,
Mexico and Peru both near or adjacent to the existing
operations (near-mine) and greenfield standalone prospects. The
Company continues exploring both near-mine and greenfield prospects
with a focus on the near-mine targets. Near-mine expansion projects
can leverage existing mine infrastructure and capability to
generate lower cost, faster development opportunities.
Çöpler District Exploration
The Company takes a disciplined approach to exploration at the
Çöpler District, optimizing the historical exploration database,
remapping and reinterpreting data, and judiciously drill testing
new targets.
A primary focus in the Çöpler District is to fast-track
exploration of oxide ore to take advantage of spare oxide plant
capacity.
The Çöpler Saddle prospect and the Ardich and Çakmaktepe
deposits represent the priorities as near–mine development projects
with potential to add to the Company's production profile within
the next two to three years.
Çöpler (80% owned)
The operating mine is the center for district exploration
activities, with established infrastructure for treating both oxide
and sulfide gold ores.
Commencing in 2017, a Çöpler in–pit exploration program
successfully provided additional oxide ore to the processing
facilities. The in–pit exploration program is ongoing, targeting
both oxide and sulfide ore. Recently, the in-pit exploration
program identified the possibility of a copper-gold porphyry system
below the Main pit. Designated C2, drill testing of the target
commenced at the end of the second quarter of 2020 and continued
through the third quarter. Initial drill results are encouraging
and are described in detail below.
C2 Porphyry Copper-Gold (80% owned)
The C2 target lies directly below the Main pit of the Çöpler
mine. In 2020, four diamond drill holes were completed along
a line of approximately 730 meters, with all holes intersecting
gold-rich copper porphyry mineralization. Chalcopyrite is visible
in the drill core with mineralization starting at or close to the
bottom of the currently defined Çöpler Main pit.
Some of the newly discovered porphyry intrusive has been exposed
in parts of the lower benches. The porphyry has well-developed
stockwork and sheeted sulfide-quartz veins. Where exposed in the
pit benches, these veins are locally overprinted by thicker
quartz-sericite-sulfide veins. The copper mineralization is
predominantly chalcopyrite formed as disseminations in the matrix
and as thin veins associated with quartz accompanied with rare
molybdenite mineralization. There is elevated arsenic in some
zones, but this does not seem to be directly correlated to the
copper mineralization. The gold mineralization is not visible.
In 2020, the Company drilled eleven diamond core holes totaling
5,379 meters, with results of the first four holes announced in a
news release dated November 25,
2020.
Significant results were returned from the initial four
holes:
- CDD955 returned 0.74% CuEq(1) over 241.5 meters from
37 meters, and 0.42% CuEq(1) over 166.2 meters from
287.5 meters.
- CDD935 returned 0.86% CuEq(1) over 108.6 meters from
103.1 meters.
- CDD940 returned 0.71% CuEq(1) over 81.5 meters from
271.2 meters.
- CDD947 returned 1.14% CuEq(1) over 49.6 meters from
156.9 meters,1.20% CuEq(1) over 18.4 meters from 237.8
meters, and 0.30% CuEq(1) over 127.7 meters from 303.3
meters.
(1)
|
Copper equivalent
calculated as CuEq = [Cu ppm + ((Au ppm*Au price(g) / Cu price(g))
/10,000)]. Based upon metal prices of $1,750/oz gold and
$3.00/pound copper with recovery assumed to be 100% as no
metallurgical test work has been completed. CuEq will change
proportionally to the metal's relative recoveries once
metallurgical test work is complete. Intervals reported are
sections with more than 0.2%CuEq (and a minimum 0.1%Cu) and less
than of 5 meters contiguous dilution.
|
Metallurgical test work commenced at a contract laboratory in
Canada on C2 diamond drill core
samples. Preliminary indications from the metallurgical flotation
test work is encouraging. The Company is currently drilling with
three diamond drill rigs and plans to increase the number of rigs
to nine in the first quarter of 2021.
Ardich Gold Deposit (80% owned)
The Ardich gold deposit is six kilometers northeast of the
Çöpler processing facilities and is accessible by the nearby haul
road to Çakmaktepe. The deposit mostly forms a tabular flat-lying
gold-rich oxide and sulfide zone at the contact between an
overlying assemblage of ultramafic rocks and underlying clastic and
limestone rock types. The deposit is predominantly oxide
mineralization.
A total of 175 drill holes were included in the maiden Ardich
Mineral Resource estimate announced November
22, 2019. Since the cut-off date for the November 2019 Mineral Resource, data has been
obtained for an additional 129 drill holes for a total of 304 drill
holes. Based on the additional drill data, the Company provided an
updated Ardich Mineral Resource estimate on November 30, 2020 within the CDMP2020, a summary
of which is provided in the table below.
The CDMP20 includes an alternative PEA case including the
development of Ardich.
Drilling continues at Ardich as the Mineral Resource remains
open for expansion. Subsequent to the November 2020 Mineral Resource estimate published
in the Technical Report which included drilling data up to
February 2020, a total of 147
additional diamond drill holes totaling 35,147 meters have been
drilled in the Ardich project. Development work including
additional technical studies and permitting also continues.
Mineral Resource
Estimate for the Ardich Deposit (as at the Effective
Date)
|
Material
Type
|
Resource
Category
Material
|
Tonnes
(kt)
|
Au
(g/t)
|
Contained Gold
(koz)
|
Oxide
(LS+HS)
|
Measured
|
4,707
|
1.63
|
246
|
Indicated
|
12,817
|
1.62
|
666
|
Measured +
Indicated
|
17,524
|
1.62
|
912
|
Inferred
|
4,713
|
1.62
|
246
|
Sulfide
|
Measured
|
695
|
2.56
|
57
|
Indicated
|
2,231
|
3.71
|
266
|
Measured +
Indicated
|
2,926
|
3.43
|
323
|
Inferred
|
782
|
4.24
|
107
|
Total
|
Measured
|
5,402
|
1.75
|
303
|
Indicated
|
15,048
|
1.93
|
932
|
Measured +
Indicated
|
20,451
|
1.88
|
1,235
|
Inferred
|
5,495
|
1.99
|
352
|
|
- Mineral Resources
for Adrich have an effective date of 27 November 2020 and have been
prepared in accordance with National Instrument 43-101 - Standards
of Disclosure for Mineral Projects ("NI 43-101"). The Mineral
Resources estimate for Ardich has been prepared by Sharron
Sylvester, BSc (Geol), RPGeo AIG (10125), employed by OreWin
Pty Ltd as Technical Director – Geology, a qualified person as
defined under NI 43-101. All key assumptions, parameters and
methods used to estimate Mineral Resources for Ardich and the data
verification procedures followed are set out in the CDMP
2020.
- Mineral Resources
that are not Mineral Reserves have not demonstrated economic
viability.
- Due to the
uncertainty that may be attached to Inferred Mineral Resources, it
cannot be assumed that all or any part of an Inferred Mineral
Resource will be upgraded to an Indicated or Measured Mineral
Resource as a result of continued exploration.
- Mineral Resources
are shown on a 100% basis. More than 96% of the Mineral Resources
are located on the SSR Mining owned 80% ground, with the remainder
of the mineralization within the 50%/50% ownership
boundary.
- Low-sulfur (LS)
oxide is defined as material with <1% total sulfur, high-sulfur
(HS) oxide is material with total sulfur >1% and <2%, and
sulfide material has ≥2% total sulfur.
- All Mineral
Resources in the CDMP 2020 were assessed for reasonable prospects
for eventual economic extraction by reporting only material that
fell within conceptual pit shells based on metal prices of
$1,750/oz for gold. The following parameters were used:
metallurgical recoveries in oxide 40.0%–73.0%, and in sulfide
82.9%; Au cut-off grades in oxide 0.30–0.55 g/t Au, and in sulfide
0.77 g/t Au, (there are no credits for Ag or Cu in the cut-off
grade calculations); allowances have been made for royalty
payable.
- Reported Mineral
Resources contain no allowances for unplanned dilution, or mining
recovery. Tonnage and grade measurements are in metric units.
Contained gold is reported in troy ounces.
- Tonnages are
rounded to the nearest thousand tonnes; grades are rounded to two
decimal places. As a result, totals may not match.
|
Çöpler Saddle (80% owned)
The Saddle prospect borders the western flank of Çöpler as a two
kilometer long north-south shear zone passing through West pit.
Çakmaktepe Mine (50% owned)
Çakmaktepe lies five kilometers east of the Çöpler processing
infrastructure. In 2019, Phase 1 was mined. Exploration is
investigating continuity to Ardich, which is immediately adjacent
to the northeast of Çakmaktepe.
The Mavialtin Porphyry Belt (50% owned by SSR Mining)
The Mavialtin Porphyry Belt contains at least four gold-copper
porphyry type exploration targets over a seven by 20 kilometer area
from Çakmaktepe in the north to the deposit at Mavidere in the
south. In February 2020, positive
drill results were announced for Mavidere, Findiklidere, and
Aslantepe. The mineralization is close to surface and appears to be
low in deleterious elements.
The exploration strategy for Mavialtin is two–fold:
- Expand the known areas of mineralization, while concurrently
making new discoveries, to economically justify a stand-alone mine;
and/or
- Define a Mavialtin Complex where various smaller deposits could
be processed through a central facility.
Mavialtin's developmental potential and optionality are
supported by:
- Proximity to existing Çöpler operations/infrastructure;
- Near-surface nature of the mineralization;
- Length of the mineralized intercepts which indicate the
potential for volume; and
- Some high-grade intercepts.
Based on the results announced in February 2020, additional mapping and
geochemistry, the Company drilled five diamond core holes totaling
2,122 meters in Findiklidere and drilled three diamond core holes
totaling 1,384 meters in Saridere Prospects between July 2020 and October
2020.
Copper Hill Copper Exploration Prospect (50% owned)
In April 2020, the Company
announced encouraging drill results from the Copper Hill
exploration prospect in the Black Sea region (northeast
Turkey). The intercepts were high
grade, close to surface and appear to be very low in contaminates.
The drilling pattern was constrained to areas previously permitted
for drilling. Additional diamond drilling planned in 2020, to test
the extension of the mineralization, was deferred due to COVID-19
related issues and is now planned for the 2021 summer drill
season.
Marigold Exploration
An important focus of the 2020 exploration program was to
identify new Mineral Resources on 11,740 hectares of adjoining
mineral tenures that were acquired between 2015 and 2019.
At Valmy, there are three historic open pits mined by previous
owners between 2002 and 2005, which produced approximately 196,000
ounces of gold. The Company has been expanding Mineral Resources
around these pits since acquisition in 2015.
At Trenton Canyon, there is a historical Mineral Resource area
and three mined pits developed by previous owners between 1996 and
2005, which produced approximately 290,000 ounces of gold. Since
acquisition in 2019, the Company has been conducting exploration to
confirm the historic drill database validity and expand known
mineralization areas. The main objective is to define an open-pit
oxide gold Mineral Resource amenable to heap leach processing.
At Buffalo Valley, predecessor companies mined a small open pit,
which produced approximately 50,000 ounces of gold between 1987 and
1990. Following acquisition in mid-2019, the Company has focused on
verifying historical information and assessing the potential for
oxide gold Mineral Resources.
A focus for the Company is to increase gold production at
Marigold by defining Mineral Resources to support additional
stand-alone heap leach facilities in the North Peak area. In 2020,
Marigold tested areas south of the currently producing Mackay Pit
including Valmy, Crossfire, East Basalt, Section 6 and Trenton
Canyon. As a result of land acquisitions, the Company is exploring
the opportunity for a larger pit concept, encompassing East Basalt,
Antler, Battle Cry and Section 6, which the Company refers to as
New Millennium. In total, 15,185 meters of reverse circulation
drilling in 48 holes and 1,055 meters of core drilling in 1 hole
were completed in the fourth quarter of 2020. During 2020, a total
of 72,788 meters were completed in 208 drill holes.
The Company completed 17.6 kilometers of seismic geophysical
survey in two lines; one east-west transect, crossing just south of
the Basalt and Antler open pits, and a north-south line the length
of the Marigold deposits and onto the Trenton Canyon ground. Once
compiled, the Company expects to validate the interpretation with
the current core drilling results that have identified the
favorable Comus Formation. This work aims to establish a method of
mapping the 3D structure of the main rock assemblages beneath the
entire property to identify targets with potential for higher-grade
sulfide mineralization.
In the fourth quarter of 2020, a soil sampling program was
initiated at the Trenton Canyon property. A total of 14.5 square
kilometers of coverage is planned, with samples collected in a 61
meter staggered grid pattern for 3,854 total samples. In the fourth
quarter of 2020, the Company completed approximately 1.5 square
kilometers, collecting 395 samples. This program is expected to be
completed in the first quarter of 2021, weather permitting. The
soil survey covers an area of ground east of the Trenton Canyon
mine extending to the tenement boundary where there is no historic
surface geochemical coverage. Anomalous gold and pathfinder
concentrations in soil strongly correlate to known mineral centers
at Trenton Canyon, and anomalies identified by the new survey will
be evaluated for future exploration campaigns.
For 2021, the Company is planning 71,450 meters of reverse
circulation and core drilling for Mineral Resource and Mineral
Reserve conversion and additions at Mackay, Valmy, New Millennium,
Trenton Canyon, and Buffalo Valley.
Canada Exploration
The Company controls two separate claim groupings in
Saskatchewan, Canada: Seabee and
the Amisk project, which is 140 kilometers southeast of Seabee.
Seabee
The Seabee mineral interests comprise 100%-owned mineral tenures
that are referred to as Seabee claims and an 80% owned joint
venture interest on the contiguous Fisher property. Through late
2020 and early 2021, Seabee exercised its option to acquire 80% of
the Fisher property and establish a joint venture, with Seabee
being the operator, to advance exploration and development.
Exploration activities in 2020, particularly at Fisher and other
Seabee brownfield targets, were impacted as the mine shut down and
then reduced ancillary activities due to COVID-19.
At Santoy, recent exploration success on Gap Hanging Wall ("Gap
HW") encouraged the Company to establish underground access to the
zone on the 46 level, which is 450 meters below surface. Gap HW has
excellent potential to provide additional ore feed and is
approximately 220 meters in the 8A mining area's hanging wall.
Sheeted quartz veins in siliceous intrusive rock host gold
mineralization at Gap HW, and the metallurgy is similar to other
ores from Santoy.
The first excavation in the Gap HW was completed in the fourth
quarter of 2020. A total of 12,470 tonnes of mineralized material
was removed, with results reconciling closely to the Company's
block model estimates in this part of the orebody. In addition, the
excavation provided the Company with geotechnical, structural and
grade continuity determinations critical for mine design. A
mobile drill rig is currently drilling tightly spaced holes into
the foot wall and hanging wall of the current excavation to further
determine grade continuity across the entire width of the zone and
enhance future block model estimates, development drives and stope
design initiatives. This program is intended to confirm structural
interpretation, continuity and grades as part of the technical work
to convert Mineral Resources to Mineral Reserves.
The focus of drilling efforts for the fourth quarter of 2020
remained on infill and extension drilling of the Gap HW, as well as
exploring the prospective Santoy Hanging Wall (Santoy HW) target.
During the fourth quarter of 2020, the Company drilled 9,606 meters
underground and an additional 3,887 meters from surface for a
combined total of 13,493 meters. During 2020, the Company completed
39,855 meters of drilling underground and 9,638 meters from surface
for a total of 49,493 meters.
In the first quarter of 2020, brownfield exploration drilling
approximately 1 kilometer south of the Santoy Mine Complex
encountered high-grade gold mineralization at the Joker target. The
sheeted quartz veins are hosted in the same siliceous intrusive
rocks as the Gap HW deposit and represent an encouraging new target
to be followed-up in 2021.
The Fisher property is contiguous to Seabee claims and, in
May 2020, the Company reported
encouraging drill results from gold prospects at Mac North,
Yin and Abel Lake. In the fourth
quarter of 2020, the Company completed a 3,500 meter drill program
at the Mac North target and was successful in expanding the zone
down-plunge and along strike, encountering wider visible
gold-bearing zones than previous drilling. In total, the Company
drilled 37 holes for 12,976 meters at Fisher in 2020. These targets
will be further explored in 2021.
Amisk
The Amisk property is 39,882 hectares and hosts an Indicated
Mineral Resource estimate. Proterozoic volcano-sedimentary rock
assemblages, prospective for both base metal massive sulfide
deposits and orogenic gold deposits, underlie the area. The
Company's plan for this property is to investigate its potential
for lode gold mineralization on the claim's western portion. The
summer field program comprised detailed mapping and prospecting of
the numerous gold showings on the property.
2021 Outlook
For the full year 2021, the Company expects to produce, on a
consolidated basis, 720,000 to 800,000 gold equivalent ounces from
its four operating mines at consolidated AISC of $1,050 to $1,110
per gold equivalent ounce.
Operating Guidance
(100%) (1)
|
|
Çöpler
(2)
|
Marigold
|
Seabee
|
Puna
|
Other
|
Consolidated
|
Gold
Production
|
koz
|
310 - 340
|
235 - 265
|
95 - 105
|
—
|
—
|
640 - 710
|
Silver
Production
|
Moz
|
—
|
—
|
—
|
6.0 - 7.0
|
—
|
6.0 - 7.0
|
Gold Equivalent
Production
|
koz
|
310 -
340
|
235 -
265
|
95 -
105
|
80 -
90
|
—
|
720 -
800
|
Cash Cost per Ounce
(3)
|
$/oz
|
550 - 600
|
810 - 860
|
525 - 575
|
10.00 -
11.50
|
—
|
660 - 715
|
Sustaining
Capital
Expenditures
(4)
|
$M
|
52
|
53
|
11
|
19
|
—
|
135
|
Capitalized Stripping
/
Capitalized Development
|
$M
|
9
|
47
|
19
|
13
|
—
|
88
|
Sustaining
Exploration
Expenditures
|
$M
|
2
|
7
|
1
|
1
|
—
|
11
|
General &
Administrative (5)
|
$M
|
—
|
—
|
—
|
—
|
30 - 35
|
30 - 35
|
Share Based
Compensation (5)
|
$M
|
—
|
—
|
—
|
—
|
15 - 20
|
15 - 20
|
All-In Sustaining
Cost per
Ounce (3)
|
$/oz
|
760 -
810
|
1,250 -
1,290
|
860 -
910
|
16.00 -
17.50
|
—
|
1,050 -
1,110
|
Growth Capital
Expenditures
|
$M
|
26
|
—
|
7
|
—
|
—
|
33
|
Growth Exploration
and Development Expenditures(6)
|
$M
|
31
|
11
|
7
|
—
|
5
|
54
|
Total Growth
Capital
|
$M
|
57
|
11
|
14
|
—
|
5
|
87
|
|
|
(1)
|
Figures may not add
due to rounding
|
(2)
|
Figures are reported
on a 100% basis. Çöpler is 80% owned by SSR Mining.
|
(3)
|
SSR Mining reports
the non-GAAP financial measures of cash costs and AISC per ounce of
gold and silver sold to manage and evaluate operating performance
at Çöpler, Marigold, Seabee and Puna. Refer to Section 13
"Non-GAAP Financial Measures".
|
(4)
|
Excludes sustaining
exploration expenditures. Includes $9.5 million oxygen plant lease
payment at Çöpler.
|
(5)
|
General and
administrative expenses exclude share-based compensation, which is
reported separately.
|
(6)
|
Growth exploration
and development expenditures are shown on a 100% basis, of which
SSR Mining attributable amount totals $46 million.
|
(7)
|
All figures in U.S.
dollars, unless otherwise noted. Gold equivalent figures for 2021
operating guidance are based on a gold-to-silver ratio of 76:1.
Cash costs and capital expenditures guidance is based on an oil
price of $45 per barrel and an exchange rate of 1.30 Canadian
dollars to one U.S. dollar and 7.5 Turkish lira to one U.S.
dollar.
|
2021 Priority Operational and Development Catalysts
Çöpler:
- Flotation circuit construction, with expected ramp-up beginning
mid-year 2021
- Ardich exploration and concurrent development towards first
production in 2023
- C2 Porphyry copper-gold exploration and advancement, focusing
on an expandable development plan
Marigold:
- Ongoing cost reduction and continuous improvement
initiatives
- Oxide exploration targeting higher grades and conversion at
Mackay, Valmy, New Millennium, Trenton Canyon and Buffalo
Valley
- Sulfide exploration and evaluation
Seabee:
- Increase mining rates to exploit latent mill capacity
- Gap Hanging Wall Mineral Resource conversion
- Seabee and Fisher exploration and resource development
Puna:
- Continue steady state production with focus on increasing
productivity
- Achieve and sustain mill throughput rates above 4,000 tonnes
per day
- Implement and integrate owner-operated ore transport fleet
Free cash flow generation in 2021 is expected to be
approximately 75% weighted to the second half of the year due to
the timing of the ramp-up and commissioning of the flotation
circuit at Çöpler, timing of capital expenditures across all sites,
working capital seasonality at Seabee, and tax and royalty payments
that are paid in the first half of the year.
Capital Returns
The Company's capital allocation strategy is to balance
continuing investment in high-return growth, maintaining peer
leading financial strength, and providing sustainable capital
returns to shareholders.
In recognition of SSR Mining's position as a leading and
sustainable free cash flow generator in the intermediate gold
sector, it is the Company's intention to return excess attributable
free cash flow to shareholders through a two-tiered capital return
structure. While a recurring quarterly dividend is expected to be
the primary method of capital return, the Company will periodically
evaluate supplementing this dividend from excess attributable free
cash flow in the form of incremental dividends and/or share buyback
programs.
On February 17, 2021, the Company's Board of Directors
approved its inaugural quarterly dividend payment of $0.05 per common share to be paid on March 31, 2021 to shareholders of record on
March 5, 2021. The dividend was
designated as an "eligible dividend" for Canadian federal and
provincial income tax purposes. Dividends paid to shareholders who
are non-residents of Canada will
be subject to Canadian non-resident withholding taxes.
Financial and Operating Highlights
A summary of the Company's consolidated financial and operating
results for the three months and year ended December 31, 2020 and 2019 are presented
below:
(in thousands of US
dollars, except per share data)
|
Three months ended
December 31,
|
Year ended
December 31,
|
|
2020
|
2019
|
2020
|
2019
|
Financial
Results
|
|
|
|
|
Revenue
|
$
|
370,729
|
$
|
177,603
|
$
|
853,089
|
$
|
606,850
|
Income from mine
operations
|
$
|
146,456
|
$
|
58,913
|
$
|
308,642
|
$
|
170,883
|
Gross margin
(2)
|
40%
|
33%
|
36%
|
28%
|
Operating
income
|
$
|
120,332
|
$
|
43,228
|
$
|
202,713
|
$
|
122,338
|
Net income
|
$
|
97,654
|
$
|
19,479
|
$
|
140,468
|
$
|
55,757
|
Net income
attributable to equity holders of SSR Mining
|
$
|
89,039
|
$
|
19,479
|
$
|
133,494
|
$
|
57,315
|
Basic attributable
net income per share
|
$
|
0.41
|
$
|
0.16
|
$
|
0.88
|
$
|
0.47
|
Adjusted attributable
net income (1)
|
$
|
108,813
|
$
|
23,717
|
$
|
213,172
|
$
|
78,758
|
Adjusted basic
attributable net income per share (1)
|
$
|
0.50
|
$
|
0.19
|
$
|
1.41
|
$
|
0.65
|
|
|
|
|
|
Cash generated by
operating activities
|
$
|
217,383
|
$
|
51,917
|
$
|
348,615
|
$
|
145,844
|
Cash (used in)
generated by investing activities
|
$
|
(54,099)
|
$
|
(22,303)
|
$
|
180,790
|
$
|
(130,328)
|
Cash (used in)
generated by financing activities
|
$
|
(36,938)
|
$
|
(3,536)
|
$
|
(173,204)
|
$
|
68,907
|
|
|
|
|
|
Operating
Results
|
|
|
|
|
Gold produced
(oz)
|
191,885
|
81,255
|
418,744
|
332,364
|
Gold sold
(oz)
|
182,328
|
85,404
|
414,163
|
331,350
|
Silver produced ('000
oz)
|
2,165
|
2,132
|
5,581
|
7,674
|
Silver sold ('000
oz)
|
1,010
|
2,584
|
4,661
|
7,695
|
Lead produced ('000
lb) (4)
|
6,529
|
7,985
|
17,193
|
23,957
|
Lead sold ('000 lb)
(4)
|
3,158
|
9,371
|
14,903
|
24,119
|
Zinc produced ('000
lb) (4)
|
2,932
|
3,007
|
6,988
|
8,392
|
Zinc sold ('000 lb)
(4)
|
1,898
|
3,067
|
6,039
|
14,072
|
|
|
|
|
|
Gold equivalent
produced (oz) (5)
|
220,432
|
106,205
|
484,153
|
421,828
|
Gold equivalent sold
(oz) (5)
|
194,862
|
114,268
|
465,471
|
415,383
|
|
|
|
|
|
Average realized gold
price ($/oz sold)
|
$
|
1,880
|
$
|
1,480
|
$
|
1,812
|
$
|
1,394
|
Average realized
silver price ($/oz sold)
|
$
|
24.78
|
$
|
17.32
|
$
|
21.23
|
$
|
16.26
|
|
|
|
|
|
Cash cost per gold
equivalent ounce sold (1, 5)
|
$
|
693
|
$
|
716
|
$
|
759
|
$
|
740
|
AISC per gold
equivalent ounce sold (1, 5)
|
$
|
976
|
$
|
1,088
|
$
|
1,138
|
$
|
1,087
|
|
|
|
Financial
Position
|
December 31,
2020
|
December 31,
2019
|
Cash and cash
equivalents
|
$
|
860,637
|
$
|
503,647
|
Current
assets
|
$
|
1,424,522
|
$
|
899,662
|
Total
assets
|
$
|
5,244,986
|
$
|
1,750,107
|
Current
liabilities
|
$
|
248,933
|
$
|
234,171
|
Total
liabilities
|
$
|
1,305,083
|
$
|
616,153
|
Working capital
(3)
|
$
|
1,175,589
|
$
|
665,491
|
(1)
|
The Company reports
non-GAAP financial measures including adjusted attributable net
income, adjusted basic attributable net income per share, cash
costs and AISC per ounce sold to manage and evaluate its operating
performance at its mines. See "Non-GAAP Financial Measures" in
Section 13.
|
(2)
|
Gross margin is
defined as income from mine operations divided by
revenue.
|
(3)
|
Working capital is
defined as current assets less current liabilities.
|
(4)
|
Data for lead
production and sales relate only to lead in lead concentrate. Data
for zinc production and sales relate only to zinc in zinc
concentrate.
|
(5)
|
Gold equivalent
ounces have been established using the average realized metal
prices per ounce of precious metals sold in the period and applied
to the recovered silver metal content produced by the mines. Zinc
and lead production are not included in gold equivalent ounces
produced.
|
Management Discussion & Analysis and Conference
Call
This news release should be read in conjunction with our audited
Consolidated Financial Statements and our MD&A as filed with
the Canadian Securities Administrators and available at
www.sedar.com or our website at www.ssrmining.com.
- Conference call and webcast: Wednesday,
February 17, 2021, at 5:00 pm
EST.
Toll-free in U.S. and
Canada:
|
+1 (800)
319-4610
|
All other
callers:
|
+1 (416)
915-3239
|
Webcast:
|
http://ir.ssrmining.com/investors/events
|
- The conference call will be archived and available on our
website. Audio replay will be available for two weeks by
calling:
Toll-free in U.S. and
Canada:
|
+1 (855) 669-9658,
replay code 6092
|
All other
callers:
|
+1 (412) 317-0088,
replay code 6092
|
About SSR Mining
SSR Mining Inc. is a leading, free cash flow focused
intermediate gold company with four producing assets located in the
USA, Turkey, Canada, and Argentina, combined with a global pipeline of
high-quality development and exploration assets in the USA, Turkey,
Mexico, Peru, and Canada. In 2020, the four operating assets
produced approximately 711,000 gold-equivalent ounces. SSR
Mining is listed under the ticker symbol SSRM on the NASDAQ and the
TSX, and SSR on the ASX.
SSR Mining Contacts:
F. Edward Farid, Executive Vice
President, Chief Corporate Development Officer
Brian Martin, Director, Corporate
Development & Investor Relations
SSR Mining Inc.
E-Mail: invest@ssrmining.com
Phone: +1 (888) 338-0046 or +1 (604) 689-3846
To receive SSR Mining's news releases by e-mail, please
register using the SSR Mining website at www.ssrmining.com.
Cautionary Note Regarding Forward-Looking
Statements
Except for statements of historical fact relating to
the Company, certain statements contained in this press release
constitute forward-looking information, future oriented financial
information, or financial outlooks (collectively "forward-looking
information") within the meaning of Canadian securities laws.
Forward-looking information may be contained in this document and
the Company's other public filings. Forward-looking information
relates to statements concerning the Company's outlook and
anticipated events or results and in some cases, can be identified
by terminology such as "may", "will", "could", "should", "expect",
"plan", "anticipate", "believe", "intend", "estimate", "projects",
"predict", "potential", "continue" or other similar expressions
concerning matters that are not historical facts.
Forward-looking information and statements in this press
release are based on certain key expectations and assumptions made
by the Company. Although the Company believes that the expectations
and assumptions on which such forward-looking information and
statements are based are reasonable, undue reliance should not be
placed on the forward-looking information and statements because
the Company can give no assurance that they will prove to be
correct. Forward-looking information and statements are subject to
various risks and uncertainties which could cause actual results
and experience to differ materially from the anticipated results or
expectations expressed in this press release. The key risks and
uncertainties include, but are not limited to: local and global
political and economic conditions; governmental and regulatory
requirements and actions by governmental authorities, including
changes in government policy, government ownership requirements,
changes in environmental, tax and other laws or regulations and the
interpretation thereof; developments with respect to the
coronavirus disease 2019 ("COVID-19") pandemic, including the
duration, severity and scope of the pandemic and potential impacts
on mining operations; and other risk factors detailed from time to
time in the Company's reports filed with the Canadian securities
regulatory authorities.
Forward-looking information and statements in this press
release include statements concerning, among other things:
forecasts; outlook; timing of production; production, cost,
operating and capital expenditure guidance; the Company's intention
to return excess attributable free cash flow to shareholders; the
timing and implementation of the Company's dividend policy; the
granting of any supplemental dividends or the implementation of any
share buyback program or other supplements to the base dividend;
statements regarding plans or expectations for the declaration of
future dividends and the amount thereof; future cash costs and AISC
per payable ounce of gold, silver and other metals sold; the prices
of gold, silver and other metals; Mineral Resources, Mineral
Reserves, realization of Mineral Reserves, and the existence or
realization of Mineral Resource estimates; the Company's ability to
discover new areas of mineralization; the timing and extent of
capital investment at the Company's operations; the timing and
extent of capitalized stripping at the Company's operations; the
timing of production and production levels and the results of the
Company's exploration and development programs; current financial
resources being sufficient to carry out plans, commitments and
business requirements for the next twelve months; movements in
commodity prices not impacting the value of any financial
instruments; estimated production rates for gold, silver and other
metals produced by the Company; the estimated cost of sustaining
capital; availability of sufficient financing; receipt of
regulatory approvals; the timing of studies, announcements, and
analysis; the timing of construction and development of proposed
mines and process facilities; ongoing or future development plans
and capital replacement; estimates of expected or anticipated
economic returns from the Company's mining projects, including
future sales of metals, concentrate or other products produced by
the Company and the timing thereof; the Company's plans and
expectations for its properties and operations; and all other
timing, exploration, development, operational, financial,
budgetary, economic, legal, social, environmental, regulatory, and
political matters that may influence or be influenced by future
events or conditions.
Such forward-looking information and statements are based on
a number of material factors and assumptions, including, but not
limited in any manner to, those disclosed in any other of the
Company's filings, and include: the inherent speculative nature of
exploration results; the ability to explore; communications with
local stakeholders; maintaining community and governmental
relations; status of negotiations and completion of transactions,
including joint ventures; weather conditions at the Company's
operations; commodity prices; the ultimate determination of and
realization of Mineral Reserves; existence or realization of
Mineral Resources; the development approach; availability and
receipt of required approvals, titles, licenses and permits;
sufficient working capital to develop and operate the mines and
implement development plans; access to adequate services and
supplies; foreign currency exchange rates; interest rates; access
to capital markets and associated cost of funds; availability of a
qualified work force; ability to negotiate, finalize, and execute
relevant agreements; lack of social opposition to the Company's
mines or facilities; lack of legal challenges with respect to the
Company's properties; the timing and amount of future production;
the ability to meet production, cost, and capital expenditure
targets; timing and ability to produce studies and analyses;
capital and operating expenditures; economic conditions;
availability of sufficient financing; the ultimate ability to mine,
process, and sell mineral products on economically favorable terms;
and any and all other timing, exploration, development,
operational, financial, budgetary, economic, legal, social,
geopolitical, regulatory and political factors that may influence
future events or conditions. While the Company consider these
factors and assumptions to be reasonable based on information
currently available to the Company, they may prove to be
incorrect.
The above list is not exhaustive of the factors that may
affect any of the Company's forward-looking statements and
information. You should not place undue reliance on forward-looking
information and statements. Forward-looking information and
statements are only predictions based on the Company's current
expectations and the Company's projections about future events.
Actual results may vary from such forward-looking information for a
variety of reasons including, but not limited to, risks and
uncertainties disclosed in the Company's filings on the Company's
website at www.ssrmining.com, on SEDAR at www.sedar.com, on EDGAR
at www.sec.gov and on the ASX at www.asx.com.au and other
unforeseen events or circumstances. Other than as required by law,
the Company does not intend, and undertake no obligation to update
any forward-looking information to reflect, among other things, new
information or future events.
All references to "$" in this press release are to U.S.
dollars unless otherwise stated.
Qualified Persons
Except as otherwise set out herein, the scientific and
technical information contained in this press release relating to
Çöpler has been reviewed and approved by Robert L. Clifford and Dr. Cengiz Y. Demirci, AIPG (CPG) each of whom is a
qualified person under NI 43-101. Mr. Clifford is the Director,
Open Pit Mine Planning and Dr. Demirci is the Vice President,
Exploration. The scientific and technical information contained in
this press release relating to Marigold has been reviewed and
approved by Greg Gibson and
James N. Carver, each of whom is a
SME Registered Member and a qualified person under NI 43-101. Mr.
Gibson is the General Manager and Mr. Carver is the Resource
Development Manager at Marigold. The scientific and technical
information contained in this press release relating Seabee has
been reviewed and approved by Samuel
Mah, P.Eng., and Jeffrey
Kulas, P. Geo., each of whom is a qualified person under NI
43-101. Mr. Mah is the Director, Underground Mine Planning, and Mr.
Kulas is the Resource Development Manager, Canada. The scientific and technical
information contained in this press release relating to Puna has
been reviewed and approved by Robert
Gill, P.Eng., and Karthik
Rathnam, MAusIMM (CP), each of whom is a qualified person
under NI 43-101. Mr. Gill is the Company's General Manager at Puna.
Mr. Rathnam is the Company's Resource Manager, Corporate.
Cautionary Note to U.S. Investors
This press release includes Mineral Reserves and Mineral
Resources classification terms that comply with reporting standards
in Canada and the Mineral Reserves
and the Mineral Resources estimates are made in accordance with NI
43-101 - Standards of Disclosure for Mineral Projects ("NI
43-101"). NI 43-101 is a rule developed by the Canadian Securities
Administrators that establishes standards for all public disclosure
an issuer makes of scientific and technical information concerning
mineral projects. These standards differ significantly from the
requirements of the SEC set out in the SEC rules that are
applicable to domestic United
States reporting companies. Consequently, Mineral Reserves
and Mineral Resources information included in this press release is
not comparable to similar information that would generally be
disclosed by domestic U.S. reporting companies subject to the
reporting and disclosure requirements of the SEC. Accordingly,
information concerning mineral deposits set forth herein may not be
comparable with information made public by companies that report in
accordance with U.S. standards.
Cautionary Note Regarding Non-GAAP Measures
This press release includes certain terms or performance
measures commonly used in the mining industry that are not defined
under International Financial Reporting Standards ("IFRS"),
including free cash flow, cash costs and AISC per payable ounce of
gold and silver sold, realized metal prices, earnings before
interest, taxes, depreciation and amortization ("EBITDA"), adjusted
attributable net income, adjusted basic attributable earnings per
share, consolidated cash and consolidated net cash. Non-GAAP
measures do not have any standardized meaning prescribed under IFRS
and, therefore, they may not be comparable to similar measures
employed by other companies. The Company believe that, in addition
to conventional measures prepared in accordance with IFRS, certain
investors use this information to evaluate the Company's
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 refer to the endnotes in this press release
for further information regarding how the Company calculates
certain of these measures. Readers should also refer to the
Company's management's discussion and analysis, available under the
Company's corporate profile at www.sedar.com or on the Company's
website at www.ssrmining.com, under the heading "Non-GAAP Financial
Measures" for a more detailed discussion of how the Company
calculates such measures and a reconciliation of certain measures
to GAAP terms.
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SOURCE SSR Mining Inc.