EBITDA(1) of $59 million on net revenues
of $134 million;Cash position of $104
million and working capital of $160
million;Net Income of $23.5 million or $0.03 per
share
Trevali Mining Corporation (“Trevali” or the
“Company”)
(TSX: TV; OTCQX: TREVF; Frankfurt: 4TI)
has released financial results for the three and six months ending
June 30, 2018. Second quarter (“
Q2”) net income
was $23.5 million ($0.03 per share) and EBITDA(1) was $59 million
on net revenues of $134 million.
Highlights:
- Consolidated Q2 zinc production of
103.9 million payable pounds. First-half 2018 consolidated zinc
production was 202.6 million payable pounds, on-track with 2018
production and cost guidance.
- Total Cash Operating Costs and
All-In Sustaining Costs decreased on a quarter to quarter basis to
$0.68 and $0.85 per pound of payable zinc produced respectively,
net of by-product credits.
- Q2 net revenues of $134 million and
$249 million for the six months ending June 30, 2018 – a 16.5%
increase in net revenues quarter-to-quarter.
- Net income of $23.5 million ($0.03
per share) in Q2 and first-half 2018 net income of $52 million
($0.06 per share). Net income was adversely affected due to
downward provisional pricing adjustments.
- Q2 EBIDTA(1) of $59 million ($0.07
per share) and first-half 2018 EBIDTA(1) of $117 million ($0.14 per
share).
- Cash and cash equivalents of $102
million.
- Working capital of $160
million.
- Debt reduction of $16 million
year-to-date on the Term Facility as part of the long-term debt
repayment schedule.
- Net debt of $149 million as of June
30, 2018; total liquidity, including cash and available credit
facilities, of $128.1 million and a 1.1 debt/EBIDTA(1) ratio (0.5
on an annualised basis).
- Continued focus on organic growth
and optimization during the quarter – advanced 2018 exploration
goals reporting material high grade zinc intercepts at Perkoa,
acquired an additional 10% of Rosh Pinah for US$23.1 million
(increasing our ownership to 90%) and purchased new power
generators at Perkoa.
(1) EBITDA (earnings before interest, taxes,
depreciation and amortization) of a business gives an indication of
its current operational profitability and is a non-IFRS measure and
is calculated on 100% basis. Please refer to “Use of Non-IFRS
Financial Performance Measures” below.
This news release should be read in conjunction
with Trevali’s unaudited condensed consolidated financial
statements and management's discussion and analysis for the three
and six months ended June 30, 2018, which is available on Trevali's
website and on SEDAR at www.sedar.com. Certain financial
information is reported herein using non-IFRS measures. Please
refer to “Use of Non-IFRS Financial Performance Measures”
below.
“As per plan, we saw increased zinc production
in the second quarter and the Company remains on track to achieve
both annual production and cost guidance," stated Dr. Mark Cruise,
Trevali's President and Chief Executive Officer. "The overall
improvements, versus the first quarter, reflect continued strong
performance at Perkoa, a return to normal capacity at Santander and
decreasing seasonal effects at Caribou. Unfortunately, Rosh Pinah
had a challenging quarter; however, we anticipate significant
improvement in the second half of the year as we focus on
optimizing operations, specifically underground mining efficiency
and productivity.”
Q2-2018 Financial Results Conference
Call:The Company will host a conference call and webcast
at 10:30AM Eastern Time on Thursday, August 9, 2018 to review the
Q2-2018 operating and financial results. Participants are advised
to dial in 5 minutes prior to the scheduled start time of the
call.
Conference call dial-in details:Date: Thursday,
August 9, 2018 at 10:30AM Eastern TimeToll-free (North America):
1-877-291-4570International: 1-647-788-4919Webcast:
http://www.gowebcasting.com/9331
Consolidated Financial Results ($
millions, except per-share amounts)
|
Three months ended |
Six months ended June 30 |
Q1-2018 |
Q2-2018 |
Q2-2017 |
2018 |
2017 |
Revenues |
$114.7 |
$133.9 |
$37.4 |
$248.6 |
$77.4 |
Income from mining operations |
$36.6 |
$46.1 |
$10.1 |
$82.7 |
$19.8 |
Net income |
$28.6 |
$23.5 |
$0.1 |
$52.0 |
$2.8 |
Basic income per share |
$0.03 |
$0.03 |
$0.00 |
$0.06 |
$0.01 |
Consolidated Production
Results
|
Three months ended |
Six months ended June 30 |
Q1-2018 |
Q2-2018 |
Q2-2017(1) |
2018 |
2017(1) |
Tonnes Mined |
790,215 |
807,166 |
371,802 |
1,597,381 |
742,755 |
Tonnes Milled |
743,935 |
820,214 |
431,093 |
1,564,149 |
864,222 |
Payable Production:Zinc (pounds)Zinc (tonnes)Lead (pounds)Lead
(tonnes)Silver (ounces) |
98,738,94444,80012,296,5555,579336,606 |
103,891,60947,13810,531,4204,778337,801 |
29,949,14813,5899,912,0954,497385,505 |
202,630,55291,93822,827,97410,358674,407 |
61,895,37628,08319,895,7589,027731,167 |
Total Cash Operating Costs (per pound of payable zinc
produced) |
$0.83 |
$0.68 |
$0.55 |
$0.74 |
$0.69 |
All-In Sustaining Cost (per pound of payable zinc produced) |
$0.97 |
$0.85 |
$0.80 |
$0.88 |
$0.86 |
Site Cash Operating Cost (per Tonne milled) (2) |
$73 |
$58 |
$50 |
$65 |
$49 |
Consolidated Sales Results
|
Three months ended |
Six months ended June 30 |
Q1-2018 |
Q2-2018 |
Q2-2017(1) |
2018 |
2017(1) |
Zinc Concentrate (dry metric tonnes) |
98,171 |
124,418 |
31,596 |
222,589 |
70,523 |
Lead Concentrate (dry metric tonnes) |
10,169 |
16,199 |
11,948 |
26,367 |
24,981 |
Payable Sales:Zinc (pounds)Zinc (tonnes)Lead (pounds)Lead
(tonnes)Silver (ounces) |
89,490,81240,6047,956,0563,610274,748 |
114,220,22151,82413,160,8775,971376,455 |
27,644,76312,5439,828,3954,459379,577 |
203,711,03392,42721,116,9339,581651,203 |
61,223,00427,77819,536,7848,864708,213 |
Revenues (3) |
$114.7 million |
$133.9 million |
$37.4 million |
$248.6 million |
$77.4 million |
Zinc realized price per payable pound sold before pricing
adjustments |
$1.49 |
$1.42 |
$1.20 |
$1.45 |
$1.24 |
Provisional and final invoicing and quantity adjustments per
payable pound sold |
($0.04) |
($0.15) |
($0.07) |
($0.10) |
($0.02) |
Zinc realized price per payable pound sold |
$1.45 |
$1.27 |
$1.13 |
$1.35 |
$1.22 |
LME average zinc price ($/pound) |
$1.55 |
$1.41 |
$1.18 |
$1.48 |
$1.22 |
(1) Q2-2017 and six months June 30, 2017
consolidated production and sales are from the Santander and
Caribou mines only. Trevali acquired the Perkoa and Rosh Pinah
mines on August 31, 2017.(2) Please refer to “Use of Non-IFRS
Financial Performance Measures” below.(3) Revenues include effects
of settlement adjustments on sales from prior quarters and is
calculated on a 100% basis.
Perkoa Mine, Burkina Faso:Q2
production was 46.2 million pounds (20,940 tonnes) of payable zinc.
Metal sales for the quarter was 58.8 million pounds (29,687 tonnes)
of zinc for revenue of $62 million. The Q2 operational gross profit
was $19.5 million, an increase of 97.2% from Q1, with operational
costs all materially decreased on a quarter-to-quarter basis.
Mine output and mill throughput for the quarter
were 182,551 tonnes and 176,027 tonnes of ore, respectively. Given
the strong performance over the first half of 2018, the Company
increased its 2018 zinc production guidance by 9 million pounds
(4,080 tonnes) to 164-174 million payable pounds (74,400-78,950
tonnes).
Perkoa Production Results
|
Three months ended |
Six monthsended June30, |
|
Q1-2018 |
Q2-2018 |
2018 |
Tonnes Mined |
192,158 |
182,551 |
374,709 |
Tonnes Milled |
179,940 |
176,027 |
355,967 |
Payable Production:Zinc (pounds)Zinc (tonnes) |
45,874,97420,814 |
46,151,64720,940 |
92,029,62141,756 |
Total Cash Operating Costs (per pound of payable zinc
produced) |
$0.78 |
$0.74 |
$0.76 |
All-In Sustaining Cost (per pound of payable zinc produced) |
$0.84 |
$0.83 |
$0.83 |
Site Cash Operating Cost (per Tonne milled) (1) |
$112 |
$87 |
$100 |
Perkoa Sales Results
|
Three months ended |
Six monthsended June 30, |
|
Q1-2018 |
Q2-2018 |
2018 |
Zinc Concentrate (dry metric tonnes) |
33,660 |
61,492 |
95,153 |
Payable Sales:Zinc (pounds)Zinc (tonnes) |
32,598,59414,791 |
58,819,24426,687 |
91,417,83741,478 |
Revenues (2) |
$36.8 million |
$62.0 million |
$98.8 million |
(1) Please refer to “Use of Non-IFRS Financial
Performance Measures” below.(2) Revenues include effects of
settlement adjustments on sales from prior quarters and is
calculated on a 100% basis.
Rosh Pinah Mine, Namibia:
Q2 production was 20.8 million pounds (9,449
tonnes) of payable zinc, 2.1 million pounds (974 tonnes) of payable
lead and 28,388 ounces of payable silver. Metal sales for the
quarter were 17.5 million pounds (7,946 tonnes) of zinc, 4.4
million pounds (2,006 tonnes) of lead and 54,050 ounces silver for
revenue of $21.6 million.
Mine output and mill throughput for the quarter
was 159,797 tonnes and 173,082 tonnes, respectively. Performance
for the quarter was below expectation; specifically, mine
production did not achieve targeted levels due to non-optimal
operational practices. Consequently, 2018 production guidance has
been reduced by 10 million pounds (4,540 tonnes) to 95-105 million
payable pounds (43,100-47,640 tonnes) of zinc. The Company is
actively addressing this issue and continues to onboard key skills,
advance workforce training, provide operational support and
implement compliance tracking.
Rosh Pinah Production
Results
|
Three months ended |
Six monthsended June30, |
|
Q1-2018 |
Q2-2018 |
2018 |
Tonnes Mined |
172,334 |
159,797 |
332,131 |
Tonnes Milled |
177,837 |
173,082 |
350,919 |
Payable Production:Zinc (pounds)Zinc (tonnes)Lead (pounds)Lead
(tonnes)Silver (ounces) |
22,831,57510,3593,925,0121,78150,473 |
20,825,3329,4492,146,67597428,388 |
43,656,90719,8086,071,6872,75579,182 |
Total Cash Operating Costs (per pound of payable zinc
produced) |
$0.90 |
$0.47 |
$0.70 |
All-In Sustaining Cost (per pound of payable zinc produced) |
$1.06 |
$0.69 |
$0.88 |
Site Cash Operating Cost (per Tonne milled) (1) |
$54 |
$47 |
$51 |
Rosh Pinah Sales Results
|
Three months ended |
Six months ended June 30, |
|
Q1-2018 |
Q2-2018 |
2018 |
Zinc Concentrate (dry metric tonnes) |
30,386 |
19,610 |
49,996 |
Lead Concentrate (dry metric tonnes) |
- |
5,388 |
5,388 |
Payable Sales:Zinc (pounds)Zinc (tonnes)Lead (pounds)Lead
(tonnes)Silver (ounces) |
28,077,20112,739--- |
17,512,0497,9464,421,3692,00654,050 |
45,589,25020,6854,421,3692,00654,050 |
Revenues (2) |
$33.2 million |
$21.5 million |
$54.7 million |
(1) Please refer to “Use of Non-IFRS Financial
Performance Measures” below.(2) Revenues include effects of
settlement adjustments on sales from prior quarters and is
calculated on a 100% basis.
Caribou Mine, Canada:Q2 production was 20.5
million pounds (9,315 tonnes) of payable zinc, 6.5 million pounds
(2,937 tonnes) of payable lead and 178,753 ounces of payable
silver. Metal sales for the quarter were 21.7 million pounds (9,858
tonnes) of zinc, 6.9 million pounds (3,114 tonnes) of lead and
196,829 ounces silver for revenue of $29.7 million.
Mine production for the quarter was 266,500
tonnes, an operational record, and mill throughput was 247,222
tonnes. As expected, the winter impacts experienced in the first
quarter decreased in the second quarter, which continues to
positively impact zinc recoveries.
Caribou Production Results
|
Three months ended |
Six months ended June 30 |
Q1-2018 |
Q2-2018 |
Q2-2017 |
2018 |
2017 |
Tonnes Mined |
238,650 |
266,500 |
223,104 |
505,150 |
445,368 |
Tonnes Milled |
235,531 |
247,222 |
225,692 |
482,753 |
458,572 |
Payable Production:Zinc (pounds)Zinc (tonnes)Lead (pounds)Lead
(tonnes)Silver (ounces) |
19,079,1238,6577,200,9553,267216,087 |
20,530,3959,3156,473,1362,937178,753 |
17,879,1048,1126,862,3703,114203,556 |
39,609,51717,97213,674,0906,204394,840 |
37,498,49917,01414,970,1436,792420,641 |
Total Cash Operating Costs (per pound of payable zinc
produced) |
$0.73 |
$0.64 |
$0.71 |
$0.68 |
$0.71 |
All-In Sustaining Cost (per pound of payable zinc produced) |
$0.90 |
$0.81 |
$0.83 |
$0.85 |
$0.83 |
Site Cash Operating Cost (per Tonne milled) (1) |
$64 |
$60 |
$61 |
$62 |
$61 |
Caribou Sales Results
|
Three months ended |
Six months ended June 30 |
Q1-2018 |
Q2-2018 |
Q2-2017 |
2018 |
2017 |
Zinc Concentrate (dry metric tonnes) |
21,409 |
24,694 |
17,491 |
46,103 |
42,457 |
Lead Concentrate (dry metric tonnes) |
9,058 |
8,959 |
8,970 |
18,017 |
19,062 |
Payable Sales:Zinc (pounds)Zinc (tonnes)Lead (pounds)Lead
(tonnes)Silver (ounces) |
17,821,2528,0866,821,9633,095207,122 |
21,727,0499,8586,863,8503,114196,829 |
15,503,5297,0347,087,5803,216208,371 |
39,548,30017,94413,685,8136,210403,951 |
37,277,15716,91314,961,2866,788411,449 |
Revenues (2) |
$28.0 million |
$29.7 million |
$21.5 million |
$57.7 million |
$47.9 million |
(1) Please refer to “Use of Non-IFRS Financial Performance
Measures” below.(2) Revenues include effects of settlement
adjustments on sales from prior quarters.
Santander Mine, Peru:Q2 production was 16.4
million pounds (7,434 tonnes) of payable zinc, 1.9 million pounds
(867 tonnes) of payable lead and 130,659 ounces of payable silver.
Metal sales for the quarter were 16.2 million pounds (7,333 tonnes)
of zinc, 1.9 million pounds (851 tonnes) of lead and 125,576 ounces
silver for revenue of $20.6 million.
After completing the scheduled major mill
maintenance program in March 2018, the mill achieved throughput of
223,884 tonnes (an operational record) and mine output of 198,318
tonnes during the second quarter. With the Santander mill now
operating at approximately 2,500 tonnes per day (above design
capacity), the Company increased its 2018 zinc production guidance
by 1 million pounds (500 tonnes) to 55 – 58 million payable pounds
(24,950 – 26,320 tonnes).
Santander Production Results
|
Three months ended |
Six months ended June 30 |
Q1-2018 |
Q2-2018 |
Q2-2017 |
2018 |
2017 |
Tonnes Mined |
187,073 |
198,318 |
148,698 |
385,391 |
297,387 |
Tonnes Milled |
150,627 |
223,884 |
205,401 |
374,511 |
405,650 |
Payable Production:Zinc (pounds)Zinc (tonnes)Lead (pounds)Lead
(tonnes)Silver (ounces) |
10,953,2724,9701,170,58853170,046 |
16,384,2357,4341,911,609867130,659 |
12,070,0455,4763,049,7241,384181,949 |
27,337,50712,4043,082,1971,398200,706 |
24,396,87911,0694,925,6152,235310,525 |
Total Cash Operating Costs (per pound of payable zinc
produced) |
$1.08 |
$0.64 |
$0.53 |
$0.81 |
$0.65 |
All-In Sustaining Cost (per pound of payable zinc produced) |
$1.44 |
$0.90 |
$0.85 |
$1.11 |
$0.91 |
Site Cash Operating Cost (per Tonne milled) (1) |
$64 |
$40 |
$38 |
$50 |
$36 |
Santander Sales Results
|
Three months ended |
Six months ended June 30 |
Q1-2018 |
Q2-2018 |
Q2-2017 |
2018 |
2017 |
Zinc Concentrate (dry metric tonnes) |
12,715 |
18,622 |
14,104 |
31,337 |
27,683 |
Lead Concentrate (dry metric tonnes) |
1,111 |
1,852 |
2,978 |
2,963 |
5,055 |
Payable Sales:Zinc (pounds)Zinc (tonnes)Lead (pounds)Lead
(tonnes)Silver (ounces) |
10,993,7664,9881,134,09351667,626 |
16,161,8797,3331,875,658851125,576 |
12,141,2335,5092,740,8151,244171,206 |
27,155,64512,3213,009,7511,366193,203 |
23,945,84810,8654,575,4982,076296,764 |
Revenues (2) |
$16.6 million |
$20.6 million |
$15.9 million |
$37.2 million |
$29.4 million |
(1) Please refer to “Use of Non-IFRS Financial
Performance Measures” below.(2) Revenues include effects of
settlement adjustments on sales from prior quarters.
Q2-2018 OPERATING COSTS AND ANNUAL COST GUIDANCE (1, 2,
3)
Q2-2018 Operating Costs and Annual Cost
Guidance (US$ per tonne)
Mine |
2018 Annual Operating Cost Guidance |
Q1-2018 Operating Costs |
Q2-2018 Operating Costs |
YTD-2018 Operating Costs |
Perkoa (100%) |
$103-$113 |
$112 |
$87 |
$100 |
Rosh Pinah (100%) |
$49-$54 |
$54 |
$47 |
$51 |
Caribou |
$55-$61 |
$64 |
$60 |
$62 |
Santander |
$38-$42 |
$65 |
$40 |
$50 |
Total |
$60-$66 |
$73 |
$58 |
$65 |
(1) Constitutes forward-looking information; see “Cautionary
Note Regarding Forward-Looking Statements”.(2) Trevali’s ownership
interest is 90% of Perkoa and 90% of Rosh Pinah.(3) Costs are
preliminary and subject to adjustment.
2018 CONSOLIDATED PRODUCTION GUIDANCE
Production guidance for the year remains
unchanged at 400-to-427 million pounds (181,450-193,760 tonnes) of
payable zinc, 43.8-to-46.0 million pounds (19,900-20,900 tonnes) of
payable lead and 1.40-to-1.47 million ounces of payable silver.
The Company increased its zinc production
guidance at Perkoa and Santander by an aggregate of 10 million
pounds (4,540 tonnes) of payable zinc offset by the lower zinc
production guidance at Rosh Pinah of 10 million pounds (4,540
tonnes). There will be moderate fluctuations on a
quarter-to-quarter basis due to normal-course mine scheduling.
2018 Quarterly zinc production guidance
(mid-range) versus actual zinc production.
A photo accompanying this announcement is available at
http://www.globenewswire.com/NewsRoom/AttachmentNg/78e18cc8-4357-4b79-8566-d1ff4b1c2e92
2018 Consolidated Production Guidance (1,
2)
Mine |
2018 Zinc Production |
2018 Lead Production |
2018 Silver Production |
Perkoa (100%) |
164-174 million lbs74,400-78,950 tonnes |
N/A |
N/A |
Rosh Pinah (100%) |
95-105 million lbs43,100-47,640 tonnes |
5.7-6.0 million lbs2,600-2,700 tonnes |
123-129 k ozs |
Caribou |
86-90 million lbs39,000-40,850 tonnes |
27.1-28.4 million lbs12,300-12,900 tonnes |
627-658 k ozs |
Santander |
55-58 million lbs24,950-26,320 tonnes |
11.0-11.6 million lbs5,000-5,300 tonnes |
654-687 k ozs |
Total |
400-427 million lbs181,450-193,760
tonnes |
43.8-46.0 million lbs19,900-20,900
tonnes |
1,404-1,474 k ozs |
(1) Constitutes forward-looking information; see
“Cautionary Note Regarding Forward-Looking Statements”. (2)
Trevali’s ownership interest is 90% of Perkoa and 90% of Rosh
Pinah.
Exploration Update – Second
Quarter:Trevali’s 2018 exploration program is focused on
brownfield and near-mine exploration targets. The primary aim is to
expand and discover new mineral resources adjacent to existing mine
infrastructure, replace mined inventory, grow sustainable
production, extend expected mine life and ultimately, contingent on
success, provide production growth optionality to the
operations.
The annual exploration program includes
approximately 60,000 metres of diamond drilling for surface and
underground targeting in-to-near mine resource growth with a
minimum committed budget of $13 million.
Exploration and resource conversion drilling
totaled approximately 26,500 metres during the quarter.
At Perkoa, 2,900 metres of underground resource
expansion drilling continued to return exceptionally high-grade
zinc results up to 240 metres below the current modelled mining
level and confirms the high-grade mineralization remains open at
depth. Highlights include:
- 9.4 metres at 26.6% zinc, including 2.6 metres at 39.3% zinc
and 3.3 metres at 31.8% zinc;
- 10.3 metres at 18.7% zinc, including 5.0 metres at 30%
zinc;
- 19.6 metres at 16.5% zinc, including 9.1 metres at 23.1%
zinc.
The exploration group continues to test the
depth extents of Perkoa system and is planning to mobilize a second
UG diamond drill rig to site.
Regionally, the Company continues to advance
high priority targets along the approximately 25-kilometre strike
of the Perkoa Mine Horizon identified to date. Using a
multi-disciplinary mineral system approach the Company has
identified significant priority VMS targets, intersected
semi-massive to massive sulphide mineralization – a first for this
frontier district, and identified areas of surface to near-surface
gossanous material (evidence of the presence of semi-massive to
massive sulphide mineralization).
Initial drill testing of the AF1 target
intersected thick zones of VMS alteration (silica – sericite –
pyrite) within which semi-massive to narrow massive sulphides
occur. Currently interpreted as the top of a VMS system, this is
the first VMS and zinc mineralization intersected outside of the
Perkoa deposit and is potentially indicative of the presence of a
productive VMS belt. Downhole geophysics will be used to vector
future drill testing. At the Byrhado prospect, 5 stacked gossan
horizons are hosted within a folded package of siliceous felsic
volcanics, tuffs and sediments that are cross cut by an intense
quartz stockwork. All samples collected to date are highly
geochemically anomalous with similar trace element pathfinder
geochemistry as the Perkoa deposit. Drill testing will occur in Q4
following the end of the wet season. The Company classifies the
target as early stage. Significant drill testing is required and
there is no guarantee that base metal sulphides will be intersected
in subsequent drill testing.
At Santander, exploration drilling continues to
test the Magistral deposit extensions approximately 300 vertical
metres below current development, in addition to continuing to
extend the emerging Pipe target at depth. Geochemical assay results
from second quarter drilling will be released in upon receipt,
anticipated in late August – early September. The approximately
45-square-kilometre Santander exploration block remains
under-explored and several priority exploration targets will be
tested during the second half of the year.
At Rosh Pinah, ongoing underground exploration
continues to define the emerging NW extension in the Western
Orefield that remains open for expansion. During the quarter the
Company re-targeted the deposit from first principals with a focus
on the historically mined Eastern Orefield. The exploration
initiative identified numerous priority targets in an area
previously or largely considered geologically closed. The Company
has hired additional dedicated exploration specialists and an
initial approximately 10,000-metre discovery drill program will
commence in H2. Regional and district targeting continues to
advance in the belt.
In the Bathurst Mining Camp, Trevali completed
resource definition drilling on its Restigouche deposit in addition
to metallurgical and geotechnical drilling on the Murray Brook
property with partner Puma Exploration. The results of both
programs will facilitate advanced engineering and production
studies for future Caribou mill feed. Late in the quarter a
12,000-metre exploration and definition drill program commenced at
the Caribou deposit to target the down-dip extensions of the East
Limb, Hinge Zone, and the newly discovered CX Zone, all of which
remain open for extension.
Senior Vice President Corporate
Development / IRAlex Terentiew will be joining Trevali in
September 2018 as Senior Vice President, Corporate
Development/Strategy and Investor Relations. Alex spent over 12
years in the investment industry as a mining and commodity research
analyst at Scotia, Credit Suisse, Raymond James and most recently
at BMO Capital Markets. At BMO he was a top-ranked analyst covering
the base metals sector in addition to providing insightful research
focused papers of long-term growth potential, value margins and
commodity research. Prior to his career in research, he was a
licensed Professional Geoscientist in the Province of Ontario. Mr.
Terentiew holds an MBA degree from the Rotman School of Management,
a Master of Applied Science in Civil Engineering and a Bachelor of
Science from the Department of Geology, both from the University of
Toronto.
Qualified Person and Quality
Control/Quality AssuranceEurGeol Dr. Mark D. Cruise,
Trevali's President and CEO, and Paul Keller, P.Eng, Trevali’s
Senior Vice President - Major Projects & Technical Support, are
qualified persons as defined by NI 43-101, and have supervised the
preparation of the scientific and technical information that forms
the basis for this news release. Dr. Cruise is not independent of
the Company as he is an officer, director and shareholder. Mr.
Keller is not independent of the Company as he is an officer and
shareholder.
ABOUT TREVALI MINING
CORPORATIONTrevali is a zinc-focused, base metals company
with four mines: the wholly-owned Santander mine in Peru, the
wholly-owned Caribou mine in the Bathurst Mining Camp of northern
New Brunswick, the 90% owned Rosh Pinah mine in Namibia and the 90%
owned Perkoa mine in Burkina Faso.
The shares of Trevali are listed on the TSX
(symbol TV), the OTCQX (symbol TREVF), the Lima Stock Exchange
(symbol TV), and the Frankfurt Exchange (symbol 4TI). For further
details on Trevali, readers are referred to the Company’s website
(www.trevali.com) and to Canadian regulatory filings on SEDAR at
www.sedar.com.
On Behalf of the Board of Directors ofTREVALI MINING
CORPORATION“Mark D. Cruise” (signed)Mark D. Cruise,
President
Contact Information:Steve Stakiw, Vice
President - Investor Relations and Corporate CommunicationsEmail:
sstakiw@trevali.comPhone: (604) 488-1661 / Direct: (604)
638-5623
Use of Non-IFRS Financial Performance
MeasuresTrevali uses non-IFRS measures such as EBITDA and
Cash Operating Costs (per Tonne milled), among other measures.
Management uses these measures internally to evaluate the
underlying operating performance of the Company for the reporting
periods presented. The use of these measures enables management to
assess performance trends and to evaluate the underlying business
of the Company. We believe that these measures reflect the
Company’s performance and are useful indicators of its expected
performance in future periods. This data is intended to provide
additional information and should not be considered in isolation of
or as a substitute for measures of performance prepared in
accordance with IFRS.
In this news release, we present EBITDA, which
we define as profit attributable to shareholders before net finance
expense, foreign exchange gains and losses, income and resource
taxes, other income and expense, and depreciation, depletion and
amortization. Our calculation of EBITDA may be different from the
calculation used by other companies, including our competitors in
the mining industry, so our measures may not be comparable to those
of other companies.
We also present in this news release Site Cash
Operating Cost (per Tonne milled), which includes mine operating
production expenses such as mining, processing, administration,
indirect charges such as surface maintenance and camp expense, and
inventory stock movement divided by tonnes milled. Site Cash
Operating Cost (per Tonne milled) does not include smelting and
refining, distribution (freight), royalties, by-product revenues,
depreciation, depletion, amortization, reclamation, and capital
sustaining and exploration expenses.
See “Cautionary Notes Regarding Forward-Looking
Statements” below as well as “Use of Non-IFRS Financial Performance
Measures” in our Management’s Discussion and Analysis for the three
and six months ended June 30, 2018.
Cautionary Note Regarding
Forward-Looking StatementsThis news release contains
“forward-looking information” within the meaning of the Canadian
securities legislation and “forward-looking statements” within the
meaning of Section 27A of the United States Securities Act of 1933,
as amended, Section 21E of the United States Exchange Act of 1934,
as amended, the United States Private Securities Litigation Reform
Act of 1995, or in releases made by the United States Securities
and Exchange Commission, all as may be amended from time.
Statements containing forward-looking information express, as at
the date of this news release, the Company’s plans, estimates,
forecasts, projections, expectations, or beliefs as to future
events or results. Such forward-looking statements and information
include, but are not limited to statements as to: the timing and
amount of estimated future production; the estimation of mineral
resources and mineral reserves; costs and timing of development;
operating efficiencies, including the ability to manage water while
reducing power consumption, costs and expenditures; expectations
regarding milling operations and metal production shortfalls; metal
output and throughput rates; cost guidance and anticipated annual
results; anticipated results of future exploration; and forecast
future metal prices.
These statements reflect the Company’s current
views with respect to future events and are necessarily based upon
a number of assumptions and estimates that, while considered
reasonable by the Company, are inherently subject to significant
business, economic, competitive, political and social uncertainties
and contingencies. If any assumptions are untrue, it could cause
actual results, performance or achievements to be materially
different from future results, performance or achievements
expressed or implied by such statements. Assumptions have been made
regarding, among other things, present and future business
strategies and the environment in which the Company will operate in
the future, including commodity prices, anticipated costs and
ability to achieve goals.
Forward-looking statements are subject to known
and unknown risks, uncertainties and other important factors that
may cause the Company’s actual results, level of activity,
performance or achievements to be materially different from those
expressed or implied by such forward-looking statements, including
but not limited to: risks related to joint venture operations;
fluctuations in spot and forward markets for silver, zinc, base
metals and certain other commodities (such as natural gas, fuel oil
and electricity); fluctuations in currency markets; risks related
to the technological and operational nature of the Company’s
business; changes in national and local government, legislation,
taxation, controls or regulations and political or economic
developments in Canada, the United States, Peru, Namibia, Burkina
Faso, or other countries where the Company may carry on business in
the future; risks and hazards associated with the business of
mineral exploration, development and mining (including
environmental hazards, industrial accidents, unusual or unexpected
geological or structural formations, pressures, cave-ins and
flooding); risks relating to the credit worthiness or financial
condition of suppliers, refiners and other parties with whom the
Company does business; inadequate insurance, or inability to obtain
insurance, to cover these risks and hazards; employee relations;
relationships with and claims by local communities and indigenous
populations; availability and increasing costs associated with
mining inputs and labour; the speculative nature of mineral
exploration and development, including the risks of obtaining
necessary licenses and permits and the presence of laws and
regulations that may impose restrictions on mining; diminishing
quantities or grades of Mineral Resources as properties are mined;
global financial conditions; business opportunities that may be
presented to, or pursued by, the Company; the Company’s ability to
complete and successfully integrate acquisitions and to mitigate
other business combination risks; challenges to, or difficulty in
maintaining, the Company’s title to properties and continued
ownership thereof; the actual results of current exploration
activities, conclusions of economic evaluations, and changes in
project parameters to deal with unanticipated economic or other
factors; increased competition in the mining industry for
properties, equipment, qualified personnel, and their costs, as
well as other risks as more fully described in the Company’s annual
information form for the year ended December 31, 2017, which is
available on the Company’s website (www.trevali.com) and filed
under our profile on SEDAR (www.sedar.com). Investors are cautioned
against attributing undue certainty or reliance on forward-looking
statements. Although the Company has attempted to identify
important factors that could cause actual results to differ
materially, there may be other factors that cause results not to be
as anticipated, estimated, described or intended. The Company does
not intend, and does not assume any obligation, to update these
forward-looking statements or information to reflect changes in
assumptions or changes in circumstances or any other events
affecting such statements or information, other than as required by
applicable law.
Note to United States
InvestorsIn accordance with applicable Canadian securities
regulatory requirements, all mineral resource estimates of the
Company disclosed or incorporated by reference in this news release
have been prepared in accordance with Canadian National Instrument
43-101 - Standards of Disclosure for Mineral Projects, classified
in accordance with Canadian Institute of Mining Metallurgy and
Petroleum's “CIM Standards on Mineral Resources and Reserves
Definitions and Guidelines”.
The Company uses the terms "measured mineral
resources", "indicated mineral resources" and "inferred mineral
resources". While these terms are recognized by Canadian securities
regulatory authorities, they are not recognized by the United
States Securities and Exchange Commission. US investors are
cautioned not to assume that any part or all of the material in
these categories will ever be converted into reserves.
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