GOLDEN, Colo., May 9, 2017 /PRNewswire/ -- Golden Minerals
Company ("Golden Minerals", "Golden" or "the Company") (NYSE MKT and TSX:
AUMN) today provided a business update and financial results for
the first quarter ended March 31,
2017.
First Quarter Business Update
- The lease of the Company's Velardena oxide mill to Hecla Mining Company
("Hecla"), which began in July 2015,
was further lengthened in March 2017
when Hecla exercised its right to extend the lease by an additional
18 months, until December 31, 2018.
Hecla began work to expand the tailings impoundment at Velardena in early 2017, as part of an earlier
agreement related to its continued use of the facility. That
expansion work has been substantially completed with sufficient
capacity expected to accommodate Hecla's planned production through
2018 plus additional capacity reserved for Golden's future use.
- Cash was $2.1 million at
March 31, 2017. Subsequent to
March 31, 2017, the Company received
the final payment of $750,000 for the
sale of excess mining equipment and $300,000 for the farm out of a non-strategic
exploration property that occurred in 2016, increasing cash on hand
by almost $1.1 million. The Company
is currently forecasting a cash balance of $1.5 million at the end of 2017.
- In February 2017, a Preliminary
Economic Assessment ("PEA") was completed on the Company's behalf
for the Santa Maria mine in
Chihuahua, Mexico. Also during the
first quarter an environmental impact assessment was approved by
SEMARNAT for the potential mining operation as considered in the
PEA. During the remainder of 2017, the Company intends to continue
work related to optimizing mining plans for the project. The
Company is also developing exploration plans to potentially expand
the deposit. No development decision has yet been made with respect
to the project.
- Subsequent to the 2,000-meter core drilling program completed
on the Rodeo property in 2016, an estimate of mineralized material
for Rodeo, prepared pursuant to Canadian National Instrument 43-101
("43-101"), was completed on the Company's behalf in January 2017. During the remainder of 2017,
Golden plans to continue work
related to economic evaluation of mining the mill-grade material
with processing at its Velardena
mill, metallurgical studies and potential expansion of the
deposit.
- At Golden's Celaya property, which is subject to an
earn-in agreement with a subsidiary of Electrum Global Holdings,
L.P., Electrum has conducted extensive geologic mapping and
sampling on the property and has been drilling since late
December 2016 to test newly
identified targets.
First Quarter Summary Results
- Revenue of $1.6 million and
positive net operating margin (oxide plant lease revenue less lease
costs) of $1.1 million related to the
lease of the Company's oxide plant in the first quarter 2017,
compared to revenue of $1.5 million
and positive net operating margin of $1.0
million related to the oxide plant lease in the first
quarter 2016
- Loss from operations of $1.1
million in the first quarter 2017 compared to a loss from
operations of $2.3 million in the
first quarter 2016
- Net loss of $1.1 million in the
first quarter 2017, including non-cash derivative losses of
$0.1 million related to the Company's
warrants, compared to a net loss of $6.3
million in the first quarter 2016, which included non-cash
derivative losses of $1.8 million
related to the Company's warrants and convertible note
- Cash and cash equivalents balance of $2.1 million as of March
31, 2017
- Debt balance of zero as of March 31,
2017
Financial Results
The Company reported revenue of approximately $1.6 million in the first quarter 2017 related to
the oxide plant lease and costs of approximately $0.5 million related to the services we provide
under the lease, for a net margin of $1.1
million. Exploration expense of $0.5
million during the first quarter was related primarily to
work at the Santa Maria and Rodeo
properties as well as holding costs and allocated administrative
expenses. Golden reported a net
loss of $1.1 million in the first
quarter 2017 compared to a net loss of $6.3
million in the year ago period. The year ago figure
included, as noted above, non-cash losses of $1.8 million related to the Company's warrants
and convertible note, plus a non-cash loss on debt extinguishment
of $1.7 million relating to a
$5.0 million convertible loan.
Financial Outlook
In addition to the $2.1 million
cash balance at March 31, 2017, in
April 2017 the Company received
approximately $0.8 million
representing final payment for the August
2016 sale of excess mining equipment, and in May 2017 received $0.3
million related to the farm out of a non-strategic
exploration property as provided for in the 2016 purchase agreement
with Santacruz Silver Mining Ltd. The Company also expects to
receive $4.8 million in net operating
margin from the lease of the oxide plant and an additional
$0.3 million from the aforementioned
exploration property farm out during the during the next 12 month
period ending March 31, 2018. With
the transactions referred to above and if no additional sales of
common stock under the Company's ATM program occur, Golden projects it would end 2017 with a cash
balance of $1.5 million and end
March 31, 2018 with a cash balance of
$1.1 million, based on the following
forecasted expenditures during the next 12 months:
- $1.5 million on exploration
activities and property holding costs related to exploration
properties located primarily in Mexico, including project assessment and
development costs related to the Santa
Maria, Rodeo and other properties;
- $1.5 million at the Velardena
Properties for care and maintenance;
- $0.5 million on El Quevar
maintenance activities and property holding costs;
- $3.5 million on general and
administrative costs, and
- $0.2 million on other working
capital.
Additional information regarding first quarter 2017 financial
results may be found in the Company's 10-Q Quarterly Report which
is available on the Golden Minerals website at
www.goldenminerals.com.
About Golden Minerals
Golden Minerals is a Delaware
corporation based in Golden,
Colorado. The Company is primarily focused on acquiring and
advancing mining properties in Mexico with emphasis on areas near its
Velardena processing plants.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1934, as
amended, and applicable Canadian securities legislation, including
statements relating to expectations regarding the oxide plant lease
including, revenues and future processing capabilities,
expectations related to our Santa
Maria property, including planned work to optimize mining
plans and planned exploration work and costs, expectations related
to our Rodeo property, including planned exploration and
other evaluation work and costs, and statements regarding our
financial outlook, including anticipated income and expenditures
for the remainder of 2017 and through the end of the first quarter
2018. These statements are subject to risks and uncertainties,
including lower than anticipated revenue from the oxide plant lease
as a result of delays or problems at the third party's mine or the
oxide plant, earlier than expected termination of the lease or
other causes, the reasonability of the economic assumptions at the
basis of the Santa Maria PEA and Rodeo 43-101, changes in
interpretations of geological, geostatistical, metallurgical,
mining or processing information and interpretations of the
information resulting from future exploration, analysis or mining
and processing experience, new information from drilling programs
or other exploration or analysis, unexpected variations in mineral
grades, types and metallurgy, fluctuations in silver and gold metal
prices, increases in costs and declines in general economic
conditions, and changes in political conditions, in tax, royalty,
environmental and other laws in Mexico, and financial market conditions.
Golden Minerals assumes no obligation to update this information.
Additional risks relating to Golden Minerals may be found in the
periodic and current reports filed with the Securities and Exchange
Commission by Golden Minerals, including the Company's Annual
Report on Form 10-K for the year ended December 31, 2016.
For additional information please visit
http://www.goldenminerals.com/ or contact:
Golden Minerals Company
Karen Winkler
Director of Investor Relations
(303) 839-5060
Investor.relations@goldenminerals.com
GOLDEN MINERALS
COMPANY
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Expressed in
United States dollars)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2017
|
|
2016
|
|
|
(in thousands, except share data)
|
Assets
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
2,065
|
|
$
|
2,588
|
Short-term
investments
|
|
|
281
|
|
|
334
|
Trade
receivables
|
|
|
445
|
|
|
380
|
Inventories
|
|
|
269
|
|
|
245
|
Value added tax
receivable, net
|
|
|
5
|
|
|
5
|
Related party
receivable
|
|
|
746
|
|
|
643
|
Prepaid expenses and
other assets
|
|
|
551
|
|
|
578
|
Total
current assets
|
|
|
4,362
|
|
|
4,773
|
Property, plant and
equipment, net
|
|
|
8,892
|
|
|
9,235
|
Total
assets
|
|
$
|
13,254
|
|
$
|
14,008
|
|
|
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
Accounts payable and
other accrued liabilities
|
|
$
|
1,190
|
|
$
|
1,224
|
Other current
liabilities
|
|
|
24
|
|
|
24
|
Total
current liabilities
|
|
|
1,214
|
|
|
1,248
|
Asset retirement and
reclamation liabilities
|
|
|
2,358
|
|
|
2,434
|
Warrant liability -
related party
|
|
|
1,025
|
|
|
976
|
Warrant
liability
|
|
|
935
|
|
|
922
|
Other long term
liabilities
|
|
|
61
|
|
|
66
|
Total
liabilities
|
|
|
5,593
|
|
|
5,646
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
Common stock, $.01
par value, 200,000,000 and 100,000,000 shares authorized;
89,658,910 and 89,020,041 shares issued and outstanding,
respectively
|
|
|
896
|
|
|
889
|
Additional paid in
capital
|
|
|
495,934
|
|
|
495,455
|
Accumulated
deficit
|
|
|
(489,172)
|
|
|
(488,037)
|
Accumulated other
comprehensive income (loss)
|
|
|
3
|
|
|
55
|
Shareholders' equity
|
|
|
7,661
|
|
|
8,362
|
Total
liabilities and equity
|
|
$
|
13,254
|
|
$
|
14,008
|
GOLDEN MINERALS
COMPANY
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS
|
(Expressed in
United States dollars) (Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
March
31,
|
|
|
2017
|
|
2016
|
|
|
(in thousands, except per share data)
|
Revenue:
|
|
|
|
|
|
|
Oxide plant
lease
|
|
$
|
1,644
|
|
$
|
1,463
|
Total
revenue
|
|
|
1,644
|
|
|
1,463
|
Costs and
expenses:
|
|
|
|
|
|
|
Oxide plant lease
costs
|
|
|
(537)
|
|
|
(474)
|
Exploration
expense
|
|
|
(534)
|
|
|
(776)
|
El Quevar project
expense
|
|
|
(149)
|
|
|
(163)
|
Velardeña shutdown
and care and maintenance costs
|
|
|
(350)
|
|
|
(587)
|
Administrative
expense
|
|
|
(1,026)
|
|
|
(1,218)
|
Stock based
compensation
|
|
|
(65)
|
|
|
(32)
|
Reclamation
expense
|
|
|
(49)
|
|
|
(51)
|
Other operating
income, net
|
|
|
157
|
|
|
39
|
Depreciation,
depletion and amortization
|
|
|
(188)
|
|
|
(550)
|
Total
costs and expenses
|
|
|
(2,741)
|
|
|
(3,812)
|
Loss from
operations
|
|
|
(1,097)
|
|
|
(2,349)
|
Other income and
(expense):
|
|
|
|
|
|
|
Interest
expense
|
|
|
—
|
|
|
(443)
|
Interest and other
income
|
|
|
18
|
|
|
3
|
Warrant derivative
(loss) gain
|
|
|
(62)
|
|
|
(1,180)
|
Derivative (loss)
gain
|
|
|
—
|
|
|
(648)
|
Loss on debt
extinguishment
|
|
|
—
|
|
|
(1,666)
|
Gain (loss) on
foreign currency
|
|
|
6
|
|
|
(4)
|
Total
other (expense) income
|
|
|
(38)
|
|
|
(3,938)
|
Loss from operations
before income taxes
|
|
|
(1,135)
|
|
|
(6,287)
|
Income tax
benefit
|
|
|
—
|
|
|
—
|
Net loss
|
|
$
|
(1,135)
|
|
$
|
(6,287)
|
Comprehensive
loss, net of tax:
|
|
|
|
|
|
|
Unrealized gain
(loss) on securities
|
|
|
(52)
|
|
|
82
|
Comprehensive
loss
|
|
$
|
(1,187)
|
|
$
|
(6,205)
|
Net loss per
common share — basic
|
|
|
|
|
|
|
Loss
|
|
$
|
(0.01)
|
|
$
|
(0.10)
|
Weighted average
Common Stock outstanding - basic (1)
|
|
|
89,350,286
|
|
|
65,868,598
|
|
|
(1)
|
Potentially dilutive
shares have not been included because to do so would be
anti-dilutive.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/golden-minerals-reports-first-quarter-2017-results-300453600.html
SOURCE Golden Minerals Company