TORONTO,
Aug. 13, 2014 /CNW/ - Gran Colombia
Gold Corp. (TSX: GCM, OTC: TPRFF) announced today the release of
its unaudited condensed consolidated financial statements and
accompanying management's discussion and analysis (MD&A) for
the three and six months ended June 30,
2014. All financial figures contained herein are
expressed in U.S. dollars unless otherwise noted.
Second Quarter 2014 Highlights
- The Company is maintaining its 2014 gold production
guidance of 102,000 to 122,000 ounces. Total gold production in the
second quarter of 2014 improved by 34% over the first quarter to
25,713 ounces reflecting the expected improvement in head grades at
its Segovia Operations as development activities provided access to
higher grade mining areas. In the second half of 2014, the
continuation of mine development at the Segovia Operations through
the Pampa Verde expansion project is expected to facilitate
expansion of production through increased tonnages and further head
grade improvement as the year progresses.
- Revenue of $32.8
million in the second quarter of 2014, up approximately 28%
from the first quarter, benefitted from the production improvement
but was still 22% below the second quarter a year ago when realized
gold prices were $186 per ounce
higher. The Company's continued focus on lowering its all-in
sustaining costs over the last year has made a significant
contribution to protecting its cash flow in the lower gold price
environment while it completes the Pampa Verde project at the
Segovia Operations.
- The Company's focus on reducing its costs over the last year
and a half, including a significant reduction in its workforce at
Segovia in the first quarter this year, combined with improving
head grades, has resulted in a decrease in total cash
costs to $1,103 per ounce in
the second quarter of 2014. All-in sustaining costs
continued to show improvement compared to last year, decreasing to
$1,203 per ounce (see the Company's
MD&A for the computation of this non-IFRS measure) in the
second quarter of 2014. Excluding a $1.9
million provision for settlement of a long-term supplier
contract at Segovia, total cash costs and all-in sustaining costs
in the second quarter of 2014 would have reached all-time lows of
$1,028 per ounce and $1,128 per ounce, respectively.
- The Company continued to control its G&A
expenses, which amounted to $1.8 million, equivalent to $71 per ounce sold, in the second quarter of
2014, bringing the first half total to $4.0
million or 50% of its expected G&A expenses for the full
year.
- Foreign exchange losses were the primary contributor to the
increase in the Company's adjusted net loss (see the
Company's MD&A for a reconciliation) to $5.8 million, or $0.25 per share, in the second quarter of 2014
compared with an adjusted net loss of $2.5
million, or $0.17 per share,
in the second quarter last year. Cost reductions were successful in
mitigating a significant portion of the impact on earnings of the
lower gold prices compared with the prior year period.
- Development: The Company's Pampa Verde expansion
project at the Segovia Operations continues to advance with
construction in process at the plant site, excavation underway in
August on the ramps at the Providencia and Sandra K mines, and
excavation of the 400-metre deep shaft at Providencia to be
completed before the end of August. Development activities are
expected to begin positively impacting gold production by the end
of the third quarter of 2014. A ramp at the Carla mine will get
underway later in 2014 that will be ready for 2015.
Serafino Iacono,
Executive Co-Chairman of Gran Colombia, commenting on the Company's
results for the second quarter of 2014, said, "We are continuing to
focus on what we can control. The second quarter saw our production
at Segovia rebound after the first quarter's operational
restructuring and our commitment to reducing costs delivered
further improvement in our all-in sustaining costs. The Pampa Verde
expansion project at Segovia is progressing well and we expect to
see its positive impact on production and costs by the end of the
third quarter."
Financial and Operating Summary
A summary of the financial and operating results
for the second quarter and first half of 2014 and 2013 is as
follows:
|
Second Quarter |
First Half |
|
2014 |
2013 |
2014 |
2013 |
Operating data: |
|
|
|
|
|
Gold produced (ounces) |
|
25,713 |
|
27,151 |
|
44,913 |
|
51,501 |
|
Gold sold (ounces) |
|
25,310 |
|
28,419 |
|
45,138 |
|
50,708 |
|
Average realized gold price ($/oz
sold) |
$ |
1,271 |
$ |
1,457 |
$ |
1,269 |
$ |
1,537 |
|
Total cash costs ($/oz sold) (1) |
|
1,103 |
|
1,133 |
|
1,081 |
|
1,198 |
|
All-in sustaining costs ($/oz sold) (1) |
|
1,203 |
|
1,293 |
|
1,200 |
|
1,409 |
|
|
|
|
|
Financial data ($000's, except
per share amounts): |
|
|
|
|
|
Revenue |
$ |
32,846 |
$ |
42,374 |
$ |
58,595 |
$ |
79,995 |
|
Net loss attributable to shareholders |
|
(17,041) |
|
(56,133) |
|
(27,292) |
|
(46,588) |
|
Basic and diluted loss per share |
|
(0.72) |
|
(3.67) |
|
(1.36) |
|
(3.05) |
|
Adjusted net loss (1) |
|
(5,837) |
|
(2,528) |
|
(10,364) |
|
(6,452) |
|
Basic and diluted adjusted loss per share (1) |
|
(0.25) |
|
(0.17) |
|
(0.52) |
|
(0.42) |
|
|
|
|
|
|
|
|
|
|
June 30,
2014 |
December 31,
2013 |
Balance sheet ($000's): |
|
|
|
|
|
Cash and cash equivalents |
|
|
|
|
$ |
3,289 |
$ |
1,609 |
|
Cash in trust, current and non-current |
|
|
|
|
|
8,769 |
|
31,774 |
|
Total debt, including current portion |
|
|
|
|
|
180,692 |
|
172,515 |
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Refer to Additional Financial Measures in the Company's
MD&A. |
Segovia Operations
At the Segovia Operations, gold production
totaled 20,059 ounces in the second quarter of 2014, a 48%
improvement from the first quarter of this year, reflecting the
expected improvement in head grades as development activities
provided access to higher grade mining areas.
In the second quarter of 2014, the Company
re-commenced mining of high grade pillar areas within the El
Silencio mine using its own contract labor resources to carry out
the work. With head grades averaging about 30 g/t in these areas,
overall head grades in the Company-operated mines increased by
approximately 40% over the first quarter of 2014 to 8.65 g/t. The
Company expects that its gold production from the Company-operated
mining areas will increase over the remaining course of 2014 as its
mine development program, including construction of new ramps and a
shaft, continues to open up additional work areas in Providencia
and Sandra K, allowing for an increase in both tonnes mined and
head grades. Gold production from the contract mining
cooperatives at Segovia in the second quarter of 2014 reflected
improvement in head grades to historical levels experienced in the
first three quarters of 2013 prior to the operational issues in the
contract mining cooperative at El Silencio. The Company is working
with the contract mining cooperatives to increase their daily
tonnages, with similar head grades, by up to 25% over the second
quarter of 2014 run rate to increase their gold production in the
second half of 2014. The Company is maintaining its total
gold production guidance for the Segovia Operations for 2014 of
80,000 to 100,000 ounces. The successful execution of the mine
development activities at the Pampa Verde Project is essential to
the Company's ability to increase its second half gold production
to meet its 2014 gold production guidance.
Marmato Operations
At the Marmato underground mine, operations
remained steady in the second quarter of 2014, processing an
average of 794 tpd resulting in gold production of 5,654 ounces.
Expected annual gold production remains at 22,000 ounces for
2014.
Webcast
As a reminder, the Company will host a
conference call and webcast on on Thursday,
August 14, 2014 at 9:30 a.m. Eastern
Time (8:30 a.m. Bogota time) to discuss the results.
Webcast and call-in details are as follows:
Live Event link: |
http://www.media-server.com/m/p/byxz5si3 |
Toronto & International: |
1 (514) 841-2157 |
North America Toll Free: |
1 (866)-215-5508 |
Colombia Toll Free: |
01 800 9 156 924 |
Conference ID: |
37658702 |
A replay of the webcast will be available at
www.grancolombiagold.com from Thursday,
August 14, 2014 until Sunday,
September 14, 2014.
About Gran Colombia Gold Corp.
Gran Colombia
is a Canadian-based gold and silver exploration, development and
production company with its primary focus in Colombia. Gran Colombia is currently the largest underground
gold and silver producer in Colombia with several underground mines in
operation at its Segovia and Marmato Operations. Gran Colombia is currently advancing a project to
develop a modern, large-scale, gold and silver mine at its Segovia
operations.
Additional information on Gran Colombia can
be found on its website at www.grancolombiagold.com and by
reviewing its profile on SEDAR at www.sedar.com.
Cautionary Statement on Forward-Looking
Information:
This news release contains "forward-looking
information", which may include, but is not limited to, statements
with respect to the future financial or operating performance of
the Company and its projects and, specifically, statements
concerning anticipated growth in annual gold production and
reduction of cash costs. Often, but not always, forward-looking
statements can be identified by the use of words such as "plans",
"expects", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates", or "believes" or variations
(including negative variations) of such words and phrases, or state
that certain actions, events or results "may", "could", "would",
"might" or "will" be taken, occur or be achieved. Forward-looking
statements involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or
achievements of Gran Colombia to be materially different from any
future results, performance or achievements expressed or implied by
the forward-looking statements. Factors that could cause actual
results to differ materially from those anticipated in these
forward-looking statements are described under the caption "Risk
Factors" in the Company's Annual Information Form dated as of
March 31, 2014, which is available
for view on SEDAR at www.sedar.com. Forward-looking statements
contained herein are made as of the date of this press release and
Gran Colombia disclaims, other than as required by law, any
obligation to update any forward-looking statements whether as a
result of new information, results, future events, circumstances,
or if management's estimates or opinions should change, or
otherwise. 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, the reader is cautioned not to place undue
reliance on forward-looking statements.
SOURCE Gran Colombia Gold Corp.