VANCOUVER, Aug. 1, 2019 /PRNewswire/ - Copper Mountain
Mining Corporation (TSX: CMMC | ASX:C6C) (the "Company" or
"Copper Mountain") announces second quarter 2019 financial and
operating results. All currency is in Canadian dollars,
unless otherwise stated. All results are reported on a 100%
basis. The Company's Financial Statements and Management
Discussion & Analysis ("MD&A") are available at
www.CuMtn.com and www.sedar.com.
SECOND QUARTER 2019 HIGHLIGHTS
- Production for the second quarter of 2019 was 22.1 million
pounds of copper equivalent (comprised of 18.4 million pounds of
copper, 6,922 ounces of gold and 65,707 ounces of silver).
- Revenue for the second quarter of 2019 was $65.1 million, from the sale of 17.9 million
pounds of copper, 7,044 ounces of gold and 55,276 ounces of silver,
net of pricing adjustments.
- C1 cash cost per pound of copper produced was US$1.74 and all-in sustaining cost (AISC) per
pound of copper produced was US$1.85.
- Earnings per share was $0.01 and
adjusted earnings per share was $0.00
for the second quarter of 2019.
- Cash flow from operations for the second quarter of 2019 was
$23.7 million.
- Cash and cash equivalents at the end of the second quarter of
2019 was $43.9 million.
"The second quarter was another consistent operating
quarter," commented Gil Clausen,
Copper Mountain's President and CEO. "We maintained our cash
position, paid down our debt and continued to advance our growth
opportunities while achieving predictable and reliable results
quarter in and quarter out."
He added, "We expect production to be stronger in the second
half of 2019 as we move into higher grade ore, and we remain on
track to achieve our annual 2019 production guidance."
SUMMARY OF OPERATING RESULTS
|
Three months
ended
June 30,
|
Six months
ended
June 30,
|
Copper Mountain
Mine
(100%
Basis)
|
2019
|
2018
|
2019
|
2018
|
Mine
|
|
|
|
|
Total tonnes mined
(000s)
|
16,139
|
19,520
|
33,593
|
36,104
|
Ore tonnes mined
(000s)
|
3,007
|
4,030
|
5,821
|
10,548
|
Waste tonnes
(000s)
|
13,132
|
15,490
|
27,772
|
25,555
|
Stripping
ratio
|
4.37
|
3.84
|
4.77
|
2.42
|
|
|
|
|
|
Mill
|
|
|
|
|
Tonnes milled
(000s)
|
3,764
|
3,368
|
7,314
|
6,860
|
Feed Grade
(Cu%)
|
0.28
|
0.34
|
0.29
|
0.33
|
Recovery
(%)
|
78.2
|
80.5
|
79.9
|
79.6
|
Operating time
(%)
|
95.0
|
89.2
|
94.0
|
90.9
|
Tonnes milled
(TPD)
|
41,363
|
37,011
|
40,409
|
37,901
|
|
|
|
|
|
Production
|
|
|
|
|
Copper (000s
lb)
|
18,450
|
20,030
|
37,060
|
39,936
|
Gold (oz)
|
6,922
|
6,524
|
14,049
|
12,594
|
Silver
(oz)
|
65,707
|
68,404
|
127,987
|
146,313
|
|
|
|
|
|
Sales
|
|
|
|
|
Copper (000s
lb)
|
17,931
|
20,411
|
37,279
|
42,152
|
Gold (oz)
|
7,044
|
6,484
|
14,070
|
12,975
|
Silver
(oz)
|
55,276
|
71,269
|
120,268
|
151,838
|
|
|
|
|
|
C1 cash cost per
pound of copper produced (US$)(1)
|
1.74
|
1.56
|
1.75
|
1.76
|
All-in-sustaining
cost (AISC) per pound of copper produced
(US$)(1)
|
1.85
|
1.78
|
1.86
|
1.96
|
Cost of Sales per
pound of copper (US$/lb sold (net))
|
2.06
|
1.98
|
2.01
|
2.07
|
Average realized
copper price (US$)
|
2.72
|
3.12
|
2.79
|
3.15
|
|
|
|
|
|
(1) Non-GAAP
performance measure. See MD&A for details.
|
|
|
|
|
In Q2 2019, the Copper Mountain Mine produced 18.4 million
pounds of copper, 6,922 ounces of gold, and 65,707 ounces of silver
compared to 20.0 million pounds of copper, 6,524 ounces of gold,
and 68,404 ounces of silver in Q2 2018. This represents a
decrease of 8% and 4% for copper and silver respectively and a 6%
increase in gold. During the quarter, the mine processed a
total of 3.8 million tonnes of ore at an average feed grade of
0.28% Cu and with a copper recovery of 78.2%. The slightly
lower recovery during the quarter was due to mining some oxidized
ore but was more than offset by the increased mill availability
which averaged 95%. The Copper Mountain Mine remains on track
to achieve production guidance for the year.
In Q2 2019, approximately 1.5 million tonnes of ore that was fed
to the mill came from the ore stockpile and was included in the
average feed grade for the quarter. Increased gold production
in Q2 2019 can be attributed to higher head grades as compared to
Q2 2018.
C1 cash cost per pound of copper produced for Q2 2019 was
US$1.74, as compared to US$1.56 realized in Q2 2018. The increase
in cost per pound was primarily a result of lower production in Q2
2019 as compared to Q2 2018. In addition, increased costs
were incurred for planned maintenance of the shovels and haul
trucks. C1 cash cost was positively impacted by the cost
associated with stripping in excess of the average life of mine
strip ratio. The total cash value of deferred stripping in Q2
2019 was $10.7 million, compared
to $12.5 million in Q2 2018.
Site cash costs for Q2 2019 were $46.9
million and C1 cash costs were $42.8
million, both in line with the previous eight
quarters. The consistency in costs over the past quarters
demonstrates reliable production and operation at the Copper
Mountain Mine quarter-after-quarter.
SUMMARY OF FINANCIAL RESULTS
Results and
Highlights (100%)
|
Three months
ended
June 30,
|
Six months
ended
June 30,
|
(In thousands of
CDN$, except for per share amounts)
|
2019
$
|
2018
$
|
2019
$
|
2018
$
|
Financial
|
|
|
|
|
Revenue
|
65,144
|
84,204
|
152,014
|
162,150
|
Gross
profit
|
1,636
|
20,672
|
24,912
|
26,984
|
Gross profit before
depreciation(1)
|
6,801
|
32,680
|
36,416
|
54,448
|
Net income
(loss)
|
2,529
|
3,638
|
20,355
|
(2,828)
|
Earnings (loss) per
share – basic
|
0.01
|
0.01
|
0.07
|
(0.02)
|
Adjusted earnings
(1)
|
917
|
11,095
|
5,119
|
22,682
|
Adjusted earnings per
share – basic
|
0.00
|
0.06
|
0.03
|
0.08
|
EBITDA(1)
|
10,257
|
22,552
|
42,121
|
34,037
|
Adjusted
EBITDA
|
6,811
|
30,009
|
26,885
|
59,547
|
Cash flow from
operations
|
23,685
|
40,121
|
47,374
|
42,139
|
Cash and cash
equivalents – end of period
|
|
|
43,896
|
72,090
|
|
|
|
|
|
(1) Non-GAAP
performance measure. See MD&A for details.
|
|
|
|
|
In Q2 2019, revenue was $65.1
million, net of pricing adjustments and treatment charges,
compared to $84.2 million in Q2
2018. Q2 2019 revenue is based on the sale of 17.9 million
pounds of copper, 7,044 ounces of gold, and 55,276 ounces of silver
and on an average realized copper price of US$2.72 per pound. This compares to 20.4
million pounds of copper, 6,484 ounces of gold and 71,269 ounces of
silver sold in Q2 2018 and an average realized copper price of
US$3.12 per pound. Revenue was
lower as a result of selling fewer pounds of copper and realizing a
lower copper price during the quarter as compared to Q2 2018.
Further, revenue in Q2 2019 included a negative mark to market
adjustment of $3.2 million as
compared to a negative mark to market adjustment of $1.3 million for Q2 2018.
Cost of sales in Q2 2019 was $63.5
million as compared to $63.5
million for Q2 2018. Unit cost of sales was
US$2.06 per pound of copper sold, net
of precious metals credits for Q2 2019, as compared to US$1.98 per pound of copper sold, net of precious
metals credits for Q2 2018. The increase in unit cost
of sales is a result of selling fewer pounds of copper during the
quarter as compared to Q2 2018.
Gross profit for Q2 2019 was $1.6
million as compared to $20.7
million for Q2 2018 and net income was $2.5 million for Q2 2019 as compared to
$3.6 million for Q2 2018. The
decrease in net income for Q2 2019, as compared to the net income
for Q2 2018, was a result of: 1) lower revenue due to fewer pounds
of copper sold and a lower realized copper price; 2) a negative
mark to market adjustment of $3.2
million included in revenue in Q2 2019 as compared to a
negative mark to market adjustment of $1.3
million for Q2 2018; 3) cost of sales including lower
depreciation of $5.2 million for Q2
2019 compared to $12 million for Q2
2018 as a result of an increased reserve base in 2018 over which
these costs are depreciated; and 4) the inclusion of a non-cash
unrealized foreign exchange gain of $6.7
million in Q2 2019 as compared to a non-cash unrealized
foreign exchange loss of $6.4 million
in Q2 2018, a differential of approximately $13 million, which was primarily related to the
Company's debt that is denominated in US dollars.
PROJECT DEVELOPMENT UPDATE
Copper Mountain Mill Expansion
During the quarter, the
Company continued to advance its expansion of the existing Copper
Mountain Mine mill, which is planned to increase throughput to
45,000 tonnes per day from 40,000 tonnes per day and also improve
copper recovery. The expansion project includes the installation of
a third ball mill that the Company has already purchased and is
currently being stored overseas. The foundation design for the new
ball mill is currently being completed and the Company plans to
ship the ball mill in the third quarter to arrive at the mine site
before year end. Final test work and design for the cleaner circuit
was completed in the second quarter, in addition to the engineering
required for the new mill maintenance shop. Subsequent to the end
of the quarter, the new higher capacity SAG Mill screen was
installed and tie-ins for the new ball mill were completed during a
planned mill shutdown for re-lining existing mills in early
July.
Eva Copper Project
The Company is currently executing
a drilling program to test additional exploration targets proximal
to Eva Copper's main deposit, Little Eva, as well as to support
metallurgical studies and down dip extensions of the Blackard
deposit. Blackard is not currently included in the Eva Copper
feasibility study and has the potential to add a material volume of
high grade tonnage to the existing planned mill feed.
Following completion of this year's drill program and metallurgical
testwork, the Company will incorporate the results into an updated
Eva Copper feasibility study planned for announcement in Q1
2020.
Q2 2019 FINANCIAL AND OPERATING RESULTS CONFERENCE CALL AND
WEBCAST
The Company will be hosting a conference call on Thursday, August 1, 2019 at 7:30 am (Pacific Time) for senior management to
discuss the second quarter 2019 results.
Dial-in
information:
|
Toronto and
international:
|
1 (647)
427-7450
|
North America
(toll-free):
|
1 (888)
231-8191
|
To participate in the
webcast live via computer go to:
|
https://event.on24.com/wcc/r/2010157/A052FEC7A4C7DC35C45A6CCF8CA82B7C
|
|
Replay Call
Information
|
Toronto and
international:
|
1 (416)
849-0833
|
Passcode: 6689529
|
North America
(toll-free):
|
1 (855)
859-2056
|
Passcode:
6689529
|
The conference call replay will be available from 10:30 am (PST) on Thursday, August 1, 2019 until
8:59 pm PST on Thursday, August 8,
2019. An archive of the audio webcast will also be available
on the Company's website at http://www.cumtn.com.
About Copper Mountain Mining Corporation
Copper Mountain's flagship asset is the 75% owned Copper
Mountain mine located in southern British
Columbia near the town of Princeton. The Copper Mountain mine currently
produces approximately 90 million pounds of copper equivalent, with
average annual production expected to increase to over 110 million
pounds of copper equivalent. Copper Mountain also has the
permitted, development-stage Eva Copper Project in Queensland, Australia and an extensive 4,000
km2 highly prospective land package in the Mount Isa
area. Copper Mountain trades on the Toronto Stock Exchange under
the symbol "CMMC" and Australian Stock Exchange under the symbol
"C6C".
Additional information is available on the Company's web page at
www.CuMtn.com.
On behalf of the Board of
COPPER MOUNTAIN MINING CORPORATION
"Gil
Clausen"
Gil Clausen, P.Eng.
President and Chief Executive Officer
Cautionary Note Regarding Forward-Looking
Statements
This news release may contain forward-looking
statements and forward-looking information (together,
"forward-looking statements") within the meaning of applicable
securities laws. All statements, other than statements of
historical facts, are forward-looking statements. Generally,
forward-looking statements can be identified by the use of
terminology such as "plans", "expects", "estimates", "intends",
"anticipates", "believes" or variations of such words, or
statements that certain actions, events or results "may", "could",
"would", "might", "occur" or "be achieved". Forward-looking
statements involve risks, uncertainties and other factors that
could cause actual results, performance and opportunities to differ
materially from those implied by such forward-looking
statements. Factors that could cause actual results to differ
materially from these forward-looking statements include the
successful exploration of the Company's properties in Canada and Australia, the reliability of the historical
data referenced in this press release and risks set out in Copper
Mountain's public documents, including in each management
discussion and analysis, filed on SEDAR at www.sedar.com.
Although Copper Mountain believes that the information and
assumptions used in preparing the forward-looking statements are
reasonable, undue reliance should not be placed on these
statements, which only apply as of the date of this news release,
and no assurance can be given that such events will occur in the
disclosed time frames or at all. Except where required by
applicable law, Copper Mountain disclaims any intention or
obligation to update or revise any forward-looking statement,
whether as a result of new information, future events or
otherwise.
Copper Mountain
Mining Corporation
|
Condensed
Consolidated Interim Statements of Financial
Position
|
(Unaudited in
thousands of Canadian dollars)
|
|
|
|
|
June
30,
2019
$
|
December
31,
2018
$
|
|
|
|
Assets
|
|
|
|
|
|
Current
assets
|
|
|
Cash and cash
equivalents
|
43,896
|
46,123
|
Accounts receivable
and prepaid expenses
|
11,934
|
18,923
|
Inventory
|
41,890
|
55,801
|
|
|
|
|
97,720
|
120,847
|
|
|
|
Reclamation
bonds
|
8,676
|
8,752
|
Transaction
costs
|
850
|
-
|
Deferred tax
assets
|
12,706
|
13,980
|
Property, plant
and equipment
|
468,014
|
448,237
|
Low grade
stockpile
|
112,437
|
109,846
|
|
|
|
|
700,403
|
701,662
|
Liabilities
|
|
|
|
|
|
Current
liabilities
|
|
|
Accounts payable and
accrued liabilities
|
35,384
|
37,494
|
Amounts payable to
related parties
|
80,983
|
69,026
|
Current portion of
long-term debt
|
56,008
|
52,956
|
Current tax
liability
|
1,381
|
622
|
|
173,756
|
160,098
|
|
|
|
Provisions
|
7,434
|
6,571
|
Interest rate swap
liability
|
573
|
601
|
Long-term
debt
|
194,768
|
229,001
|
Deferred tax
liability
|
2,159
|
2,135
|
|
378,690
|
398,406
|
Equity
Attributable to
shareholders of the Company:
|
|
|
Share
capital
|
263,863
|
263,822
|
Contributed
surplus
|
18,475
|
17,378
|
Accumulated other
comprehensive loss
|
(4,362)
|
(1,655)
|
Accumulated
deficit
|
(34,428)
|
(48,030)
|
|
243,548
|
231,515
|
Non-controlling
interest
|
78,165
|
71,741
|
Total
equity
|
321,713
|
303,256
|
|
|
|
|
700,403
|
701,662
|
Copper Mountain
Mining Corporation
|
Condensed
Consolidated Interim Statements of Income (Loss) and Comprehensive
Income (Loss)
|
For the Three and
Six Months Ended June 30
|
(Unaudited in
thousands of Canadian dollars, except for number of and earnings
per share)
|
|
|
|
|
Three months
ended
June
30,
|
Six months ended
June 30,
|
|
2019
$
|
2018
$
|
2019
$
|
2018
$
|
|
|
|
|
|
Revenue
|
65,144
|
84,204
|
152,014
|
162,150
|
Cost of
sales
|
(63,508)
|
(63,532)
|
(127,102)
|
(135,166)
|
Gross
profit
|
1,636
|
20,672
|
24,912
|
26,984
|
|
|
|
|
|
Other income and
expenses
|
|
|
|
|
General and
administration
|
(2,631)
|
(3,591)
|
(5,392)
|
(6,065)
|
Share based
compensation
|
(526)
|
(381)
|
(1,187)
|
(887)
|
Operating income
(loss)
|
(1,521)
|
16,700
|
18,333
|
20,032
|
|
|
|
|
|
Finance
income
|
151
|
206
|
254
|
342
|
Finance
expense
|
(4,442)
|
(3,847)
|
(8,241)
|
(7,361)
|
Unrealized (loss)
gain on interest rate swap
|
(96)
|
229
|
(490)
|
1,002
|
Foreign exchange
(loss) gain
|
6,709
|
(6,385)
|
12,774
|
(14,461)
|
|
|
|
|
|
Income (loss)
before tax
|
801
|
6,903
|
22,630
|
(446)
|
|
|
|
|
|
Current tax
expense
|
(463)
|
(322)
|
(976)
|
(667)
|
Deferred income and
resource tax recovery (expense)
|
2,191
|
(2,943)
|
(1,299)
|
(1,715)
|
|
|
|
|
|
Net income
(loss)
|
2,529
|
3,638
|
20,355
|
(2,828)
|
|
|
|
|
|
Other
comprehensive income (loss)
|
|
|
|
|
Foreign currency
translation adjustment
|
(1,904)
|
(535)
|
(2,707)
|
(535)
|
Total
comprehensive income (loss)
|
625
|
3,103
|
17,648
|
(3,363)
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to:
|
|
|
|
|
Shareholders of the
Company
|
1,102
|
2,189
|
13,602
|
(3,062)
|
Non-controlling
interest
|
1,427
|
1,449
|
6,753
|
234
|
|
|
|
|
|
|
2,529
|
3,638
|
20,355
|
(2,828)
|
Earnings (loss)
per share:
|
|
|
|
|
Basic
|
0.01
|
0.01
|
0.07
|
(0.02)
|
Diluted
|
0.01
|
0.01
|
0.07
|
(0.02)
|
|
|
|
|
|
Weighted average
shares outstanding, basic (thousands)
|
188,216
|
177,440
|
188,199
|
156,116
|
|
|
|
|
|
Weighted average
shares outstanding, diluted (thousands)
|
190,751
|
181,756
|
190,720
|
160,560
|
|
|
|
|
|
Shares outstanding
at end of the period (thousands)
|
188,237
|
188,104
|
188,237
|
188,104
|
Copper Mountain
Mining Corporation
|
Condensed
Consolidated Interim Statements of Cash Flows
|
For the Three and
Six Months Ended June 30,
|
(Unaudited in
thousands of Canadian dollars)
|
|
|
|
|
Three months ended
June 30,
|
Six months
ended June 30,
|
|
2019
$
|
2018
$
|
2019
$
|
2018
$
|
Cash flows from
operating activities
|
|
|
|
|
Net income (loss) for
the period
|
2,529
|
3,638
|
20,355
|
(2,828)
|
|
|
|
|
|
Adjustments
for:
|
|
|
|
|
Depreciation
|
5,183
|
12,008
|
11,522
|
27,464
|
Unrealized foreign
exchange (gain) loss
|
(5,906)
|
5,118
|
(9,588)
|
12,526
|
Unrealized loss (gain)
on interest rate swap
|
96
|
(229)
|
490
|
(1,002)
|
Deferred income and
resource tax expense
|
(2,191)
|
2,991
|
1,299
|
1,708
|
Finance
expense
|
4,442
|
3,847
|
8,241
|
7,361
|
Share based
compensation
|
526
|
381
|
1,187
|
608
|
|
4,679
|
27,754
|
33,506
|
45,837
|
Net changes in working
capital items
|
19,006
|
12,367
|
13,868
|
(3,698)
|
Net cash from
operating activities
|
23,685
|
40,121
|
47,374
|
42,139
|
|
|
|
|
|
Cash flows from
investing activities
|
|
|
|
|
Cash acquired in
acquisition of Altona
|
-
|
29,115
|
-
|
29,115
|
Transaction
costs
|
(850)
|
(763)
|
(850)
|
(2,237)
|
Share issue
costs
|
-
|
(364)
|
-
|
(364)
|
Deferred stripping
activities
|
(10,744)
|
(12,463)
|
(24,344)
|
(12,463)
|
Purchase of property,
plant and equipment
|
(5,560)
|
(10,532)
|
(7,820)
|
(11,871)
|
Net cash (used in)
from investing activities
|
(17,154)
|
4,993
|
(33,014)
|
2,180
|
|
|
|
|
|
Cash flows from
financing activities
|
|
|
|
|
Proceeds on exercise
of options and warrants
|
19
|
143
|
26
|
199
|
Advances from
non-controlling interest
|
-
|
-
|
15,035
|
14,029
|
Payments made to
non-controlling interest
|
-
|
(1,469)
|
(329)
|
(1,469)
|
Loan principal
paid
|
(9,541)
|
(9,515)
|
(22,369)
|
(21,893)
|
Interest
paid
|
(3,734)
|
(3,818)
|
(6,230)
|
(5,782)
|
Finance lease
payments
|
(711)
|
(1,532)
|
(1,274)
|
(3,989)
|
Net cash used in
financing activities
|
(13,967)
|
(16,191)
|
(15,141)
|
(18,905)
|
|
|
|
|
|
Effect of foreign
exchange rate changes on cash and cash
equivalents
|
(615)
|
599
|
(1,446)
|
1,543
|
|
|
|
|
|
(Decrease)
Increase in cash and cash equivalents
|
(8,051)
|
29,522
|
(2,227)
|
26,957
|
|
|
|
|
|
Cash and cash
equivalents - Beginning of period
|
51,947
|
42,568
|
46,123
|
45,133
|
|
|
|
|
|
Cash and cash
equivalents - End of period
|
43,896
|
72,090
|
43,896
|
72,090
|
|
|
|
|
|
|
|
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SOURCE Copper Mountain Mining Corporation