Ero Copper Corp.
(TSX: ERO, NYSE:
ERO) (“Ero” or the “Company”) is pleased to
announce its financial results for the three and twelve months
ended December 31, 2021. Management will host a conference call
tomorrow, Wednesday, March 9, 2022, at 11:30 a.m. Eastern time to
discuss the results. Dial-in details for the call can be found near
the end of this press release.
HIGHLIGHTS
- Record full-year copper production
of 45,511 tonnes and gold production of 37,798 ounces included
11,918 tonnes of copper and 8,544 ounces of gold produced during
the fourth quarter, surpassing the high-end of the Company's 2021
production guidance ranges;
- Copper C1 cash costs(*) for the
fourth quarter and full year were $0.96 and $0.77, respectively,
per pound of copper produced;
- Gold C1 cash costs(*) for the
fourth quarter and full year were $582 and $525, respectively, per
ounce of gold produced. All-in Sustaining Costs ("AISC")(*) for the
same periods were $910 and $732, respectively, per ounce of gold
produced;
- Record 2021 adjusted EBITDA(*) of
$331.9 million included $86.8 million of adjusted EBITDA(*)
generated during the fourth quarter;
- Fourth quarter and full-year adjusted
net income attributable to owners of the Company(*) were $59.7
million ($0.65 per share on a diluted basis) and $215.4 million
($2.37 per share on a diluted basis), respectively, with the latter
representing another record metric for the Company;
- Quarterly cash flows from
operations of $66.7 million brought full-year cash flows from
operations to $364.6 million, which included a $100.0 million
upfront payment related to the August 2021 closing of the $110
million streaming agreement with RGLD Gold AG, a wholly- owned
subsidiary of Royal Gold Inc., in relation to gold production from
the NX Gold Mine (the "NX Gold Stream");
- Available liquidity of $230.1
million at December 31, 2021 included $130.1 million of cash and
cash equivalents and $100.0 million of undrawn availability under
the Company's senior secured revolving credit facility; and,
- Reiterate
previously announced full-year 2022 production, operating cost and
capital guidance.
SUBSEQUENT EVENTS
- In February 2022, the Company
bolstered its balance sheet and liquidity position with an offering
of $400 million of senior unsecured notes due 2030. The Company
subsequently used approximately $50 million of net proceeds from
the offering to repay the outstanding balance under its senior
secured revolving credit facility and intends to use the remaining
proceeds, together with cash on hand, to fund capital expenditures
related to the construction of the Boa Esperança Project and for
general corporate purposes.
- Concurrent to
the closing of the $400 million senior unsecured notes offering,
the Company reduced the size of its senior secured revolving credit
facility from $150 million to $75 million, with an accordion option
to increase to $100 million at the election of the Company.
- Pro forma liquidity position,
subsequent to closing, was approximately $550 million, including
approximately $475 million in cash and cash equivalents and $75
million of undrawn availability under the Company's senior secured
revolving credit facility.
- In February 2022, the Company
announced that its Board of Directors approved the construction of
the Boa Esperança Project, which is expected to commence
construction in Q2 2022.
Commenting on the results, David Strang, CEO,
stated, “2021 marked another exceptional year for Ero. In addition
to delivering record copper production and financial results, our
team made significant progress in solidifying transformational
organic growth plans, placing the Company in a strong position to
execute on initiatives targeting approximately 100,000 tonnes of
annual copper production and 60,000 ounces of annual gold
production by 2025.
“Building upon operational momentum, subsequent
to year-end we bolstered our balance sheet with a $400 million
senior unsecured notes offering, providing ample liquidity to fund
our organic growth plans over the coming years. Near-term, we will
be focused on commencing the construction of the Boa Esperança
Project, which we expect to occur in Q2 2022, further advancing
construction of the external shaft of the Pilar Mine, an integral
component of our Pilar 3.0 initiative, and continuing to grow our
asset base through ongoing exploration.
“As we look to the future, we are excited to
solidify our position as one of the world's cleanest and fastest
growing copper producers. With decarbonization and tightening
emission standards expected to drive significant copper demand
growth in the years ahead, our fully-funded growth strategy leaves
us well-positioned to be at the forefront of low carbon-intensive
copper production.”
*Earnings before interest, taxes, depreciation
and amortization (“EBITDA”), Adjusted EBITDA, Adjusted net income
attributable to owners of the Company, Adjusted net income per
share attributable to owners of the Company, C1 cash cost per pound
of copper produced, C1 cash cost per ounce of gold produced and
All-in Sustaining Costs (“AISC”) per ounce of gold produced are
non-IFRS measures – see the Notes section of this press release for
additional information. C1 cash cost per pound of copper produced
are net of by-product credits from metal produced at the MCSA
Mining Complex. AISC per ounce of gold produced are net of
by-product credits from metal produced at the NX Gold Mine.
FOURTH QUARTER & FULL-YEAR REVIEW
-
Mining & Milling Operations – strong Q4
operating results contributed to another year of record copper
production
- The MCSA
Mining Complex processed 646,319 tonnes of ore grading 2.01%
copper, producing 11,918 tonnes of copper in concentrate during the
quarter after metallurgical recoveries of 92.7%; full year 2021
copper production totaled 45,511 tonnes based on approximately 2.4
million tonnes processed at copper grades of 2.08% and
metallurgical recoveries of 92.4%.
- Higher
quarter-on-quarter copper production was driven primarily by
increased mill throughput volumes related to (i) the ramp-up of
mining activity and processing of stockpiled ore from the Surubim
open pit mine and (ii) a return to higher mill capacity levels
following the completion of preventative mill maintenance, which
impacted mill throughput volumes in Q2 and Q3 of 2021.
- The NX
Gold Mine processed 47,159 tonnes grading 6.24 grams per tonne,
producing 8,544 ounces of gold after metallurgical recoveries of
90.3% and 5,859 ounces of silver produced as by-product; full year
2021 tonnes processed totaled 171,581 at an average grade of 7.27
grams per tonne, producing 37,798 ounces of gold after
metallurgical recoveries of 94.2% and 25,031 ounces of silver
produced as by-product.
-
Commissioning of the NX Gold Mine's paste-fill plant, where
construction was completed in Q3 2021, continued during the fourth
quarter and concluded in January 2022. The paste- fill plan is
expected to improve overhand cut and fill mining operations and
enhance pillar recovery throughout the mine.
-
Organic Growth
Projects – clear and fully-funded organic growth
strategy
-
During the fourth quarter, the Company finalized a redesign of the
new external shaft of the Pilar Mine to allow for higher sustained
production rates as part of the Pilar 3.0 initiative, which was
announced subsequent to year-end. Plans to construct a larger shaft
were driven by continued exploration success within the Deepening
Extension Zone and in the upper levels of the Pilar Mine, enabling
the creation of a two-mine system whereby the upper levels of the
mine will be serviced by the existing shaft, while the Deepening
Extension Zone will utilize the new, larger external shaft. Pilar
3.0 is expected to enable higher annual production volumes of 2.6
to 3.0 million tonnes compared to the current production rate of
approximately 1.3 million tonnes per annum at the Pilar Mine.
- The
Company announced that its Board of Directors approved the
construction of the Boa Esperança Project subsequent to year-end.
Construction is expected to commence in Q2 2022, with first
production anticipated in H2 2024.
OPERATING AND FINANCIAL HIGHLIGHTS
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3 months |
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3 months |
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3 months |
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12 months |
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12 months |
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ended |
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ended |
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ended |
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ended |
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ended |
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Dec. 31, 2021 |
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Sep. 30, 2021 |
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Dec. 31, 2020 |
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Dec. 31, 2021 |
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Dec. 31, 2020 |
Operating Highlights |
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Copper (MCSA
Operations) |
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Ore Processed (tonnes) |
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646,319 |
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572,666 |
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|
483,447 |
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|
2,370,571 |
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|
2,271,625 |
Grade (% Cu) |
|
2.01 |
|
|
1.90 |
|
|
2.26 |
|
|
2.08 |
|
|
2.08 |
Cu Production (tonnes) |
|
11,918 |
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|
10,057 |
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|
10,018 |
|
|
45,511 |
|
|
42,814 |
Cu Production (000 lbs) |
|
26,275 |
|
|
22,170 |
|
|
22,086 |
|
|
100,333 |
|
|
94,388 |
Cu Sold in Concentrate (tonnes) |
|
12,393 |
|
|
10,762 |
|
|
10,265 |
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|
45,717 |
|
|
42,813 |
Cu Sold in Concentrate (000 lbs) |
|
27,321 |
|
|
23,727 |
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|
22,629 |
|
|
100,788 |
|
|
22,629 |
C1 cash cost of Cu produced (per lb)(1) |
$ |
0.96 |
|
$ |
0.94 |
|
$ |
0.69 |
|
$ |
0.77 |
|
$ |
0.67 |
Gold (NX Gold
Operations) |
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|
|
|
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Au Production (oz) |
|
8,544 |
|
|
9,426 |
|
|
10,789 |
|
|
37,798 |
|
|
36,830 |
C1 cash cost of Au Produced (per oz)(1) |
$ |
582 |
|
$ |
538 |
|
$ |
405 |
|
$ |
525 |
|
$ |
457 |
AISC of Au produced (per oz)(1) |
$ |
910 |
|
$ |
741 |
|
$ |
608 |
|
$ |
732 |
|
$ |
628 |
Financial Highlights
($ in millions,
except per share
amounts) |
Revenues |
$ |
134.9 |
|
$ |
111.8 |
|
$ |
91.2 |
|
$ |
489.9 |
|
$ |
324.1 |
Gross profit |
|
84.4 |
|
|
68.0 |
|
|
58.3 |
|
|
318.9 |
|
|
188.1 |
EBITDA(1) |
|
80.7 |
|
|
48.5 |
|
|
91.3 |
|
|
296.4 |
|
|
116.2 |
Adjusted EBITDA(1) |
|
86.8 |
|
|
72.9 |
|
|
67.2 |
|
|
331.9 |
|
|
207.1 |
Cash flow from operations |
|
66.7 |
|
|
150.7 |
|
|
38.6 |
|
|
364.6 |
|
|
162.8 |
Net income |
|
60.2 |
|
|
26.4 |
|
|
66.3 |
|
|
202.6 |
|
|
52.5 |
Net income attributable to owners of the Company |
|
59.8 |
|
|
26.1 |
|
|
65.8 |
|
|
201.1 |
|
|
51.6 |
Per share (basic) |
|
0.67 |
|
|
0.29 |
|
|
0.75 |
|
|
2.27 |
|
|
0.60 |
Per share (diluted) |
|
0.65 |
|
|
0.28 |
|
|
0.71 |
|
|
2.21 |
|
|
0.56 |
Adjusted net income attributable
to owners of the Company(1) |
|
59.7 |
|
|
45.7 |
|
|
37.4 |
|
|
215.4 |
|
|
117.3 |
Per share (basic) |
|
0.67 |
|
|
0.52 |
|
|
0.43 |
|
|
2.43 |
|
|
1.36 |
Per share (diluted) |
|
0.65 |
|
|
0.49 |
|
|
0.40 |
|
|
2.37 |
|
|
1.27 |
Cash, cash equivalents, and short-term |
|
|
|
|
|
investments |
|
130.1 |
|
|
92.6 |
|
|
62.5 |
|
|
130.1 |
|
|
62.5 |
Working capital(1) |
|
86.0 |
|
|
81.4 |
|
|
35.8 |
|
|
86.0 |
|
|
35.8 |
Net debt(1) |
|
(70.9 |
) |
|
(63.7 |
) |
|
105.6 |
|
|
(70.9 |
) |
|
105.6 |
(1) EBITDA, Adjusted EBITDA, Adjusted net income
(loss) attributable to owners of the Company, Adjusted net income
(loss) per share attributable to owners of the Company, Net Debt,
Working Capital, C1 cash cost of copper produced (per lb), C1 cash
cost of gold produced (per ounce) and AISC of gold produced (per
ounce) are non-IFRS measures – see the Notes section of this press
release for a discussion on non-IFRS Measures.
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|
|
|
ADJUSTED EBITDA & NET INCOME (LOSS) RECONCILIATION |
|
($ in thousands) |
3 months ended Dec. 31, 2021 |
|
|
|
Adjusted EBITDA |
$ |
86,780 |
|
Adjustments: |
|
|
Unrealized foreign exchange loss on USD denominated balances in
MCSA |
|
(1,649 |
) |
Unrealized foreign exchange gain on derivative contracts |
|
3,278 |
|
Realized foreign exchange loss on derivative contracts |
|
(6,151 |
) |
Share based compensation and other |
|
(878 |
) |
Incremental costs in response to COVID-19 pandemic |
|
(669 |
) |
EBITDA |
$ |
80,711 |
|
|
|
|
Adjusted net
income attributable
to owners of
the Company |
$ |
59,729 |
|
Adjustments for non-cash items (attributable to owners of the
Company): |
|
|
Unrealized foreign exchange loss on USD denominated debt in
MCSA |
|
(1,642 |
) |
Unrealized foreign exchange gain on derivative contracts, net of
tax |
|
2,648 |
|
Unrealized gain on interest rate derivative |
|
714 |
|
Share based compensation |
|
(981 |
) |
Incremental costs in response to COVID-19 pandemic |
|
(664 |
) |
Reported net
income attributable
to owners of
the Company |
$ |
59,804 |
|
2022 PRODUCTION OUTLOOK(*) |
|
|
Copper production guidance from the MCSA Mining
Complex of 43,000 to 46,000 tonnes of copper in concentrate is
expected to come from the Pilar and Vermelhos underground mines as
well as the Surubim open pit mine. Total ore processed of
approximately 3.0 million tonnes at a blended grade of 1.60% copper
is expected to be comprised of 1.8 million tonnes at 1.50% copper
from the Pilar Mine, 900,000 tonnes at 2.05% copper from the
Vermelhos Mine, and 300,000 tonnes at 0.75% copper from the Surubim
Mine.
Gold production guidance from the NX Gold Mine
for 2022 of 39,000 to 42,000 ounces is expected to come from the
Santo Antônio Vein based on total ore processed of approximately
168,000 tonnes at a gold grade of 8.00 grams per tonne.
|
2022 Guidance(1) |
MCSA Mining
Complex |
|
Tonnes Processed |
3,000,000 |
|
Copper Grade (% Cu) |
1.60 |
% |
Copper Recovery (%) |
92.5 |
% |
Copper Production
(tonnes) |
43,000-46,000 |
|
|
NX Gold
Mine |
|
Tonnes Processed |
168,000 |
|
Gold Grade (gpt) |
8.00 |
|
Gold Recovery (%) |
93.0 |
% |
Gold Production
(ounces) |
39,000-42,000 |
2022 COST GUIDANCE(*)
The Company's cost guidance for 2022 assumes a USD:BRL foreign
exchange rate of 5.30, a gold price of $1,725 per ounce and a
silver price of $20.00 per ounce.
|
2022 Guidance |
MCSA Mining Complex C1 Cash Cost Guidance
(US$/lb) (1) |
$1.05 -
$1.15 |
NX Gold Mine C1 Cash Cost Guidance (US$/oz) (1) |
$500 -
$600 |
NX Gold Mine All-in Sustaining Cost (AISC) Guidance
(US$/oz) (1) |
$925 -
$1,025 |
(1) C1 Cash Costs and AISC are a non-IFRS measure - see the
Notes section of this press release for additional information.
2022 CAPITAL EXPENDITURE GUIDANCE(*)
The Company's capital expenditure guidance for 2022 assumes a
USD:BRL foreign exchange rate of 5.30 and has been presented below
in USD millions.
|
2022 Guidance |
MCSA Mining
Complex |
|
Growth |
$125 - $140 |
Sustaining |
$80 - $90 |
Exploration |
$25 - $30 |
Total, MCSA
Mining Complex |
$230-$260 |
|
|
Boa Esperança
Project |
|
Growth |
$70 - $80 |
Sustaining |
$0 |
Exploration |
$5 - $6 |
Total, Boa
Esperança Project |
$75-$86 |
|
|
NX Gold
Mine |
|
Growth |
$0 - $1 |
Sustaining |
$16 - $18 |
Exploration |
$9 - $10 |
Total, NX Gold
Mine |
$25-$29 |
|
|
Company Total |
|
Growth |
$195 - $221 |
Sustaining |
$96 - $108 |
Exploration |
$39 - $46 |
Total, Company |
$330-$375 |
(*) Guidance is based on certain estimates and
assumptions, including but not limited to, mineral reserve
estimates, grade and continuity of interpreted geological
formations and metallurgical performance. Please refer to the
Company’s SEDAR and EDGAR filings, including the Company's most
recent Annual Information Form, for complete risk factors.
The Company's Annual Report on Form 40-F for the
year ended December 31, 2021 will be filed with the United States
Securities and Exchange Commission (www.sec.gov) by March 30,
2022.
CONFERENCE CALL DETAILS
The Company will hold a conference call on Wednesday, March 9,
2022 at 11:30 am Eastern time (8:30 am Pacific time) to discuss
these results.
Date: |
Wednesday,
March 9, 2022 |
Time: |
11:30 am Eastern time (8:30 am Pacific time) |
Dial in: |
North America: 1-800-319-4610, International:
+1-604-638-5340 |
|
please dial in 5-10 minutes prior and ask to join the call |
|
|
Replay: |
North America: 1-800-319-6413, International:
+1-604-638-9010 |
Replay Passcode: |
8517 |
NOTES
Non-IFRS measures
The Company utilizes
certain alternative performance (non-IFRS) measures to monitor its
performance, including C1 cash cost of copper produced (per lb), C1
cash cost of gold produced (per ounce), AISC of gold produced (per
ounce), realized gold price (per ounce), EBITDA, adjusted EBITDA,
adjusted net income attributable to owners of the Company, adjusted
net income per share, net (cash) debt, working capital and
available liquidity. These performance measures have no
standardized meaning prescribed within generally accepted
accounting principles under IFRS and, therefore, amounts presented
may not be comparable to similar measures presented by other mining
companies. These non-IFRS measures are intended to provide
supplemental information and should not be considered in isolation
or as a substitute for measures of performance prepared in
accordance with IFRS.
C1 cash cost
of copper
produced (per
lb.)
C1 cash cost of
copper produced (per lb) is a non-IFRS performance measure used by
the Company to manage and evaluate the operating performance of its
copper mining segment and is calculated as C1 cash costs divided by
total pounds of copper produced during the period. C1 cash costs
includes total cost of production, transportation, treatment and
refining charges, and certain tax credits relating to sales
invoiced to the Company's Brazilian customer on sales, net of
by-product credits and incentive payments. C1 cash cost of copper
produced per pound is widely reported in the mining industry as
benchmarks for performance but does not have a standardized meaning
and is disclosed in supplement to IFRS measures.
C1 cash cost
of gold produced
(per ounce)
C1 cash cost of gold
produced (per ounce) is a non-IFRS performance measure used by the
Company to manage and evaluate the operating performance of its
gold mining segment and is calculated as C1 cash costs divided by
total ounces of gold produced during the period. C1 cash cost
includes total cost of production, net of by-product credits and
incentive payments. C1 cash cost of gold produced per ounce is
widely reported in the mining industry as benchmarks for
performance but does not have a standardized meaning and is
disclosed in supplemental to IFRS measures.
All-in Sustaining
Cost of gold
produced (per
ounce)
All-in sustaining
cost of gold produced (per ounce) is an extension of C1 cash cost
of gold produced (per ounce) discussed above and is also a key
performance measure used by management to evaluate operating
performance of its gold mining segment. AISC of gold produced (per
ounce) is calculated as AISC divided by total ounces of gold
produced during the period. AISC includes C1 cash costs, site
general and administrative costs, accretion of mine closure and
rehabilitation provision, sustaining capital expenditures,
sustaining leases, and royalties and production taxes. AISC of gold
produced (per ounce) is widely reported in the mining industry as
benchmarks for performance but does not have a standardized meaning
and is disclosed in supplement to IFRS measures.
Earnings before
interest, taxes,
depreciation and
amortization (EBITDA)
and Adjusted
EBITDA
EBITDA and adjusted
EBITDA are non-IFRS performance measures used by management to
evaluate its debt service capacity and performance of its
operations. EBITDA represents earnings before finance expense,
income taxes, depreciation and amortization. Adjusted EBITDA is
EBITDA before the pre-tax effect of adjustments for non-cash and/or
non-recurring items required in determination of EBITDA under its
revolving credit facility for covenant calculation purposes.
Adjusted net income attributable to
owners of the Company and Adjusted net income per share
attributable to owners of
the Company
“Adjusted net income
attributable to owners of the Company” is net income attributed to
shareholders as reported, adjusted for certain types of
transactions that, in management's judgment, are not indicative of
our normal operating activities or do not necessarily occur on a
recurring basis. “Adjusted net income per share attributable to
owners of the Company” (“Adjusted EPS”) is calculated as "adjusted
net income attributable to owners of the Company" divided by
weighted average number of outstanding common shares in the period.
The Company believes that, in addition to conventional measures
prepared in accordance with IFRS, the Company and certain investor
and analysts use these supplemental non-IFRS performance measures
to evaluate the normalized performance of the Company. The
presentation of Adjusted EPS is not meant to substitute the net
income (loss) per share attributable to owners of the Company
(“EPS”) presented in accordance with IFRS, but rather it should be
evaluated in conjunction with such IFRS measures.
Net (Cash)
Debt
Net (cash) debt is a
performance measure used by the Company to assess its financial
position and ability to pay down its debt. Net (cash) debt is
determined based on cash and cash equivalents, short-term
investments, net of loans and borrowings as reported in the
Company’s consolidated financial statements.
Working
capital and
Available liquidity
Working capital is
calculated as current assets less current liabilities as reported
in the Company’s consolidated financial statements. The Company
uses working capital as a measure of the Company’s short-term
financial health and ability to meet its current obligations using
its current assets. Available liquidity is calculated as the sum of
cash and cash equivalents, short- term investments and the undrawn
amount available on its revolving credit facilities. The Company
uses this information to evaluate the liquid assets available.
ABOUT ERO COPPER CORP
Ero Copper Corp is a high-growth, clean copper
producer with operations in Brazil and corporate headquarters in
Vancouver, B.C. The Company's primary asset is a 99.6% interest in
the Brazilian copper mining company, Mineração Caraíba S.A.
("MCSA"), 100% owner of the MCSA Mining Complex, which is comprised
of operations located in the Curaçá Valley, Bahia State, Brazil,
where the Company currently mines copper from the Pilar and
Vermelhos underground mines and the Surubim open pit mine, and the
Boa Esperança development project, an IOCG-type copper project
located in Pará, Brazil. The Company also owns 97.6% of NX Gold
S.A. ("NX Gold") which owns the NX Gold Mine, an operating gold and
silver mine located in Mato Grosso, Brazil. Additional information
on the Company and its operations, including technical reports on
the MCSA Mining Complex, Boa Esperança and NX Gold properties, can
be found on the Company's website (www.erocopper.com), on SEDAR
(www.sedar.com), and on EDGAR (www.sec.gov).
ERO COPPER
CORP.
|
|
/s/ David Strang |
For further
information contact: |
David Strang, CEO |
Courtney
Lynn, VP, Corporate Development & Investor Relations |
|
(604)
335-7504 |
|
info@erocopper.com |
CAUTION REGARDING FORWARD LOOKING INFORMATION
AND STATEMENTS
This press release contains “forward-looking
statements” within the meaning of the United States Private
Securities Litigation Reform Act of 1995 and “forward-looking
information” within the meaning of applicable Canadian securities
legislation (collectively, “forward-looking statements”).
Forward-looking statements include statements that use
forward-looking terminology such as “may”, “could”, “would”,
“will”, “should”, “intend”, “target”, “plan”, “expect”, “budget”,
“estimate”, “forecast”, “schedule”, “anticipate”, “believe”,
“continue”, “potential”, “view” or the negative or grammatical
variation thereof or other variations thereof or comparable
terminology. Such forward-looking statements include, without
limitation, statements with respect to the Company's guidance
and/or outlook on future production, costs and capital
expenditures; development plans, costs, timelines, ability to
finance and/or approvals for, as well as benefits, production
and/or performance expected by, growth projects including
development of the Deepening Extension Zone, construction of the
new external shaft, and creation of a two-mine system at the Pilar
Mine, and construction of the Boa Esperança mine; the Company’s
expectations, strategies, and plans for the MCSA Mining Complex,
the NX Gold Property and the Boa Esperança Property, including, but
not limited to, the Company’s planned exploration, development and
production activities; and the significance and timing of any
particular exploration program or result and the Company’s
expectations for current and future exploration plans.
Forward-looking statements are not a guarantee
of future performance and are based upon a number of estimates and
assumptions of management in light of management’s experience and
perception of trends, current conditions and expected developments,
as well as other factors that management believes to be relevant
and reasonable in the circumstances, as of the date of this press
release including, without limitation, assumptions about: continued
effectiveness of the measures taken by the Company to mitigate the
possible impact of COVID-19 on its workforce and operations;
favourable equity and debt capital markets; the ability to raise
any necessary additional capital on reasonable terms to advance the
production, development and exploration of the Company’s properties
and assets; future prices of copper and other metal prices; the
timing and results of exploration and drilling programs; the
accuracy of any mineral reserve and mineral resource estimates; the
geology of the MCSA Mining Complex, NX Gold Property and the Boa
Esperança Property being as described in the technical reports for
these properties; production costs; the accuracy of budgeted
exploration and development costs and expenditures; the price of
other commodities such as fuel; future currency exchange rates and
interest rates; operating conditions being favourable such that the
Company is able to operate in a safe, efficient and effective
manner; work force conditions to remain healthy in the face of
prevailing epidemics, pandemics or other health risks (including
COVID-19), political and regulatory stability; the receipt of
governmental, regulatory and third party approvals, licenses and
permits on favourable terms; obtaining required renewals for
existing approvals, licenses and permits on favourable terms;
requirements under applicable laws; sustained labour stability;
stability in financial and capital goods markets; availability of
equipment and critical supplies, spare parts and consumables;
positive relations with local groups and the Company’s ability to
meet its obligations under its agreements with such groups; and
satisfying the terms and conditions of the Company’s current loan
arrangements. While the Company considers these assumptions to be
reasonable, the assumptions are inherently subject to significant
business, social, economic, political, regulatory, competitive,
global health, and other risks and uncertainties, contingencies and
other factors that could cause actual actions, events, conditions,
results, performance or achievements to be materially different
from those projected in the forward-looking statements. Many
assumptions are based on factors and events that are not within the
control of the Company and there is no assurance they will prove to
be correct.
Furthermore, such forward-looking statements
involve a variety of known and unknown risks, uncertainties and
other factors which may cause the actual plans, intentions,
activities, results, performance or achievements of the Company to
be materially different from any future plans, intentions,
activities, results, performance or achievements expressed or
implied by such forward-looking statements. Such risks include,
without limitation the risk factors listed under the heading “Risk
Factors” in the Company's most recent Annual Information Form.
Although the Company has attempted to identify
important factors that could cause actual actions, events,
conditions, results, performance or achievements to differ
materially from those described in forward-looking statements,
there may be other factors that cause actions, events, conditions,
results, performance or achievements to differ from those
anticipated, estimated or intended.
The Company cautions that the foregoing lists of
important assumptions and factors are not exhaustive. Other events
or circumstances could cause actual results to differ materially
from those estimated or projected and expressed in, or implied by,
the forward-looking statements contained herein. There can be no
assurance that forward-looking statements will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking
statements.
Forward-looking statements contained herein are
made as of the date of this press release and the Company disclaims
any obligation to update or revise any forward-looking statement,
whether as a result of new information, future events or results or
otherwise, except as and to the extent required by applicable
securities laws.
CAUTIONARY NOTES REGARDING MINERAL RESOURCE AND
MINERAL RESERVE ESTIMATES
In accordance with applicable Canadian
securities regulatory requirements, all mineral reserve and mineral
resource estimates of the Company disclosed in this press release
have been prepared in accordance with NI 43-101 and are classified
in accordance with the Canadian Institute of Mining, Metallurgy and
Petroleum (“CIM”) Definition Standards for Mineral Resources and
Mineral Reserves, adopted by the CIM Council on May 10, 2014 (the
“CIM Standards”). 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. NI 43-101 differs significantly from
the disclosure requirements of the Securities and Exchange
Commission (the “SEC”) generally applicable to U.S. companies. For
example, the terms “mineral reserve”, “proven mineral reserve”,
“probable mineral reserve”, “mineral resource”, “measured mineral
resource”, “indicated mineral resource” and “inferred mineral
resource” are defined in NI 43-101. These definitions differ from
the definitions in the disclosure requirements promulgated by the
SEC. Accordingly, information contained in this press release may
not be comparable to similar information made public by U.S.
companies reporting pursuant to SEC disclosure requirements.
Mineral resources which are not mineral reserves
do not have demonstrated economic viability. Pursuant to the CIM
Standards, mineral resources have a higher degree of uncertainty
than mineral reserves as to their existence as well as their
economic and legal feasibility. Inferred mineral resources, when
compared with measured or indicated mineral resources, have the
least certainty as to their existence, and 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. Pursuant to NI 43-101, inferred mineral
resources may not form the basis of any economic analysis.
Accordingly, readers are cautioned not to assume that all or any
part of a mineral resource exists, will ever be converted into a
mineral reserve, or is or will ever be economically or legally
mineable or recovered.
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