YAMANA GOLD INC. (TSX:YRI; NYSE:AUY; LSE:AUY) (“Yamana” or the
"Company”) is herein reporting its financial and operational
results for the fourth quarter and full year 2021. Record quarterly
gold equivalent ounces ("GEO")(2) production from Yamana mines(4)
of 281,388 GEO(2) significantly exceeded the previously provided
quarterly guidance of 270,000 GEO(2) with exceptional gold
production contributing to the strong performance. Record annual
GEO(2) production from Yamana mines(4) of 1,011,180 GEO(2) also
exceeded guidance of 1,000,000 GEO(2). Combined with low fourth
quarter costs, including total cost of sales, cash costs(1) and
all-in sustaining costs ("AISC")(1) of $1,091, $642 and $962 per
GEO(2) respectively, the standout operating results generated an
all-time quarterly record of $238.2 million in cash flows from
operating activities from Yamana mines(4) and strong free cash flow
before dividends and debt repayments(1) of $119.6 million.
FOURTH QUARTER AND FULL YEAR
HIGHLIGHTS
Financial Results - Record Cash Flows, Increase to Mine
Operating Earnings
- Fourth quarter net earnings(3) of
$109.7 million or $0.11 per share basic and diluted. Adjusted net
earnings(1)(3) of $101.4 million or $0.11 per share basic and
diluted.
- Mine operating earnings of $189.4
million, an increase of 23% quarter-over-quarter.
- Cash flows from operating
activities reached an all-time quarterly record of $238.2 million
from Yamana mines(4), increasing by 25% quarter-over-quarter. Cash
flows from operating activities before net change in working
capital increased 14% quarter-over-quarter to $230.8 million.
- Free cash flow before dividends and
debt repayments(1) of $119.6 million, an increase of 47%
quarter-over-quarter.
- Cash and cash equivalents totalled
$525.0 million(8) and the Company has $750.0 million in available
credit.
|
Three months ended December 31 |
(In millions of United States Dollars) |
|
2021 |
|
|
2020 |
Net
Free Cash Flow (1) |
$ |
188.4 |
|
$ |
118.9 |
Free Cash Flow before Dividends and Debt Repayments (1) |
$ |
119.6 |
|
$ |
61.8 |
Operating Results - Standout Quarters from Canadian
Malartic, Jacobina and El Peñón, Exceptional
Quarter from Cerro Moro
- As guided, production was weighted
at 53% for the second half of the year, with record fourth quarter
production of 281,388 GEO(2) significantly exceeding the previously
provided guidance of 270,000 GEO(2).
- Record annual GEO(2) production
from Yamana mines(4) of 1,011,180 GEO(2) exceeded annual guidance
of 1,000,000 GEO(2). The full-year GEO(2) record was comprised of
884,793 ounces of gold and 9,169,289 ounces of silver.
- Fourth quarter gold production of
240,718 ounces marks the highest all-time total production from
Yamana mines(4), with the record-breaking production a result of
the planned sequential quarter-over-quarter increases. Within the
quarter, the planned sequential month-over-month increase in
production resulted in December being a standout month. Of note, is
the milestone on December 27, 2021 of the 6 millionth ounce poured
at Canadian Malartic since the initial mill start-up in 2011.
- Silver production of 3,142,781
ounces was underpinned by both El Peñón and Cerro Moro which
recorded their highest quarterly silver production totals of the
year.
- El Peñón had its strongest
production quarter of the year, with GEO(2) production of 67,901
exceeding plan and annual production of 226,330 GEO(2) exceeded
guidance of 222,000 GEO(2)
- Cerro Moro produced 58,078 GEO(2)
during the quarter with 156,484 GEO(2) produced for the full year,
an increase of 18% year-over-year.
- Canadian Malartic had a strong
fourth quarter producing 88,933 ounces of gold with annual
production of 357,392 ounces, exceeding guidance of 350,000
ounces.
- Jacobina had an exceptional fourth
quarter and delivered record quarterly gold production of 48,228
ounces, and record full year gold production of 186,206 ounces,
exceeding guidance of 175,000 ounces.
- Fourth quarter total cost of sales,
cash costs(1) and AISC(1) per GEO(2) of $1,091, $642, and $962
respectively, were the lowest quarterly costs of the year. For the
year, total cost of sales, cash costs(1) and AISC(1) per GEO(2) of
$1,132, $689 and $1,030 respectively, were all lower
year-over-year.
Updated Mineral Reserves and Mineral
Resources
- On February 8, 2022, the Company
announced its year-end 2021 mineral reserve and mineral resource
estimates supporting its guidance and longer-term outlook. The
Company replaced gold mineral reserves at each of its wholly-owned
operations and by 130% over mined depletion, highlighting the
sustainability and longevity of its mines.
- As at December 31, 2021, the
Company reports mineral reserves of 13.7 million ounces of gold,
111 million ounces of silver and 6.7 billion pounds of copper,
relatively unchanged from the prior year.
- Largely consistent with the prior
year, the Company reports measured and indicated mineral resources
of 14.5 million ounces of gold, 51 million ounces of silver, and
1.4 billion pounds of copper exclusive of mineral reserves.
- The Company reports inferred
mineral resources of 15.5 million ounces of gold, 63 million ounces
of silver, and 2.13 billion pounds of copper. The large base of
mineral resources provides the pipeline for future conversion to
mineral reserves at existing operations and development projects
and represents further growth opportunities at the Company’s
generative exploration projects. Furthermore, a significant portion
of these mineral resources could be converted to mineral reserves
at higher metal price assumptions.
- For additional details, please
refer to the February 8, 2022 press release entitled "Yamana Gold
reports updated mineral reserves and mineral resources underpinning
increasing mine lives across its portfolio".
Capital Returns
- On July 29, 2021, the Company
announced a normal-course issuer bid (“NCIB”) to purchase up to
48,321,676 common shares of the Company, representing up to 5% of
the Company’s then current issued and outstanding common shares, in
open-market transactions through the facilities of the Toronto
Stock Exchange, the New York Stock Exchange and alternative
Canadian trading systems. The Company believes that from time to
time the market price of its common shares does not represent their
full value and growth prospects and views purchases of common
shares as an attractive investment comparable to its investments in
its portfolio of exploration and development stage assets. Since
the commencement of the NCIB in July, the Company has repurchased,
and subsequently cancelled, a total of 6,672,628 common shares for
approximately C$35.6 million.
Health, Safety and Sustainable
Development
- The Company's Total Recordable
Injury Rate in 2021 was 0.73(6) for our wholly-owned operations and
exploration projects. The change from the full year 2020 results
primarily reflects an increase in low-energy incidents. The Company
initiated campaigns across all operations focused on reducing the
most common injuries that have occurred in 2021.
- As of February 11, 2022 more than
99%(7) of the Company's employees and contractors at its
wholly-owned operations and exploration projects have received at
least one dose of a COVID-19 vaccine and more than 94%(7) have
received two doses. Approximately 55%(7) of workers have received a
third dose booster shot.
- The Company successfully completed
the second year of a three-year implementation of the Mining
Association of Canada’s Towards Sustainable Mining program and the
World Gold Council’s Responsible Gold Mining Principles. The
results of self-assessments confirm that significant progress was
achieved in 2021 and the Company is well positioned to achieve
conformance by Year 3.
- The Company completed foundational
work on its Climate Action Strategy and established greenhouse gas
(“GHG”) abatement pathways for Scope 1 and 2 emissions. As a
result, Yamana raised its climate action ambition from a 2ºC -
aligned target in early 2021 to a 1.5ºC target, compared to
pre-industrial levels. The annual rate of emissions reduction
required to meet the 1.5ºC target in 2030 is estimated to be
between 4% to 5% and is expected to require only a modest,
incremental amount of investment. The Company is on track to
produce approximately 85% of its GEO(2) using renewable energy by
the end of 2022. Yamana will continue to assess opportunities to
further improve GHG abatement efforts, including adoption of
evolving technologies for its new mines.
- In December the MARA project was
recognized at the Silver and Gold Summit in Buenos Aires for their
public participation program and efforts to engage and introduce
communities to mining.
OPERATING RESULTS SUMMARY
|
For the three months ended December 31, 2021 |
GoldProduction |
SilverProduction |
GEO(2)
Production |
Total cost of sales per GEO(2)
Sold |
Cash Cost(1)per
GEO(2) Sold |
AISC(1)per
GEO(2) Sold |
Canadian Malartic (50%) |
88,933 |
— |
88,933 |
$1,171 |
$676 |
$931 |
Jacobina |
48,228 |
— |
48,228 |
$763 |
$452 |
$643 |
Cerro Moro |
30,028 |
2,165,785 |
58,078 |
$1,224 |
$726 |
$1,044 |
El Peñón |
55,282 |
976,996 |
67,901 |
$929 |
$582 |
$761 |
Minera Florida |
18,247 |
— |
18,247 |
$1,535 |
$911 |
$1,313 |
Total |
240,718 |
3,142,781 |
281,388 |
$1,091 |
$642 |
$962 |
|
For the year ended December 31, 2021 |
GoldProduction |
SilverProduction |
GEO(2)Production |
Total cost of sales per GEO(2)
Sold |
Cash Cost(1)per
GEO(2) Sold |
AISC(1)per
GEO(2) Sold |
Canadian Malartic (50%) |
357,392 |
— |
357,392 |
$1,135 |
$647 |
$901 |
Jacobina |
186,206 |
— |
186,206 |
$863 |
$566 |
$738 |
Cerro Moro |
79,988 |
5,582,197 |
156,484 |
$1,332 |
$848 |
$1,228 |
El Peñón |
176,439 |
3,587,092 |
226,330 |
$1,054 |
$673 |
$932 |
Minera Florida |
84,768 |
— |
84,768 |
$1,434 |
$881 |
$1,224 |
Total |
884,793 |
9,169,289 |
1,011,180 |
$1,132 |
$689 |
$1,030 |
|
For the three months ended December 31, 2020 |
GoldProduction |
SilverProduction |
GEO(2)Production |
Total cost of sales per
GEO(2) Sold |
Cash Cost(1)per
GEO(2) Sold |
AISC(1)per
GEO(2)Sold |
Canadian Malartic (50%) |
86,371 |
— |
86,371 |
$1,126 |
$634 |
$898 |
Jacobina |
44,165 |
— |
44,165 |
$907 |
$590 |
$807 |
Cerro Moro |
21,259 |
1,663,708 |
42,943 |
$1,343 |
$768 |
$1,139 |
El Peñón |
43,512 |
922,954 |
55,529 |
$1,023 |
$696 |
$1,025 |
Minera Florida |
26,352 |
— |
26,352 |
$1,279 |
$760 |
$1,087 |
Total |
221,659 |
2,586,662 |
255,361 |
$1,131 |
$675 |
$1,076 |
|
For the year ended December 31, 2020 |
GoldProduction |
SilverProduction |
GEO(2)
Production |
Total cost of sales per GEO(2)
Sold |
Cash Cost(1)per
GEO(2) Sold |
AISC(1)per
GEO(2) Sold |
Canadian Malartic (50%)(5) |
284,317 |
— |
284,317 |
$1,207 |
$702 |
$945 |
Jacobina |
177,830 |
— |
177,830 |
$844 |
$544 |
$746 |
Cerro Moro |
66,995 |
5,448,561 |
132,415 |
$1,513 |
$868 |
$1,280 |
El Peñón |
160,824 |
4,917,101 |
216,749 |
$980 |
$657 |
$922 |
Minera Florida |
89,843 |
— |
89,843 |
$1,366 |
$862 |
$1,152 |
Total |
779,810 |
10,365,662 |
901,155 |
$1,151 |
$701 |
$1,080 |
OPERATIONS UPDATE
Canadian Malartic
Canadian Malartic had a strong fourth quarter in
line with plan, producing 88,933 ounces. Canadian Malartic
delivered annual production of 357,392 ounces of gold, exceeding
the guidance of 350,000 ounces. Fourth quarter results benefited
from higher grade and recoveries compared to the fourth quarter of
2020 from ore deeper in the Malartic pit. During 2021, the mine
continued the transition from the Malartic pit to the Barnat pit,
and the mine completed the final 7,000 meters of topographic
drilling at Barnat during October, while overburden removal was
completed earlier in the year as planned. As previously disclosed,
the Company expects that the average strip ratio will normalize
over the coming years as the mine transitions from the Malartic pit
to the Barnat pit, and then decrease as the Barnat pit goes deeper.
Further optimizations as part of the budgeting process this year,
including a more controlled contribution from stockpiles, have
resulted in improved cash flows in the near term, despite the
previously guided and disclosed lower production and throughput in
2022, relative to 2021, as noted in the 2021 Technical Report.
Total cost of sales, cash costs(1) and AISC(1)
per GEO(2) for the quarter were $1,171, $676 and $931,
respectively, with costs for the full year all decreasing
year-over-year.
Jacobina
Jacobina had an exceptional fourth quarter and
delivered record quarterly gold production of 48,228 ounces, and
record full-year gold production of 186,206 ounces, exceeding
guidance of 175,000 ounces. The record production results were
driven by tonnes mined, which also reached all-time highs,
providing additional flexibility through the development of
stockpiles supporting the higher throughput expected from the
ongoing phased expansion. Underground mine development work is in
line with the mine plan at 1,500 metres per month, gearing up for
the higher production rate and to access new mining panels.
Production in 2021 increased for the eighth consecutive year, a
trend that is expected to continue in the coming years, as a result
of the phased expansion strategy and the exploration programs aimed
at generating significant value from the remarkable geological
upside of the property.
Quarterly costs including total cost of sales,
cash costs(1) and AISC(1) per GEO(2) of $763, $452 and $643
respectively, were all well below the annual cost guidance ranges,
and were significantly lower year-over-year. The low cost
performance was driven by higher production from the increased mill
throughput. Full year total cost of sales, cash costs(1) and
AISC(1) per GEO(2) were all within the guided ranges for 2021.
Cerro Moro
Cerro Moro had its strongest quarter of the
year, producing 58,078 GEO(2) comprising 30,028 ounces of gold and
2,165,785 ounces of silver. Production continued to benefit from
access to additional mining faces, which supported the increase in
mill feed coming from higher-grade underground ore and stable
throughput. Gold and silver recoveries improved significantly in
the fourth quarter over the prior quarter, and while gold recovery
remained relatively stable over the comparative quarter, silver
recovery improved significantly.
The opening of more mining faces and resultant
increase in mill feed coming from higher-grade underground ore
continued in the fourth quarter with Zoe contributions becoming
more prevalent, and this trend is expected to continue during 2022.
During the fourth quarter, most of the ore delivered to the plant
came from Escondida Far West, Zoe, Escondida Central and Escondida
West. Over the past year, Cerro Moro has optimized the operation of
the processing plant to increase daily throughput to approximately
1,100 tpd. With improvements to mine development and flexibility,
the Company anticipates a more balanced quarterly production
profile over the year.
Total cost of sales, cash costs(1) and AISC(1)
per GEO(2) during the fourth quarter were $1,224, $726, and $1,044,
respectively, all well below the annual cost guidance ranges for
the mine and also lower year-over-year, as a result of the strong
production results during the quarter. Full year total cost of
sales, cash costs(1) and AISC(1) per GEO(2) were all lower
year-over-year.
El Peñón
El Peñón had its strongest production quarter of
the year, with GEO(2) production of 67,901 exceeding plan,
including gold production of 55,282 ounces, and 976,996 ounces of
silver. El Peñón's annual production of 226,330 GEO(2) exceeded
guidance of 222,000 GEO(2). As planned, operations entered
higher-grade zones at the La Paloma and Pampa Campamento mining
sectors, which contributed to the higher production results in the
fourth quarter. The first step to unlock the opportunity to
leverage the existing processing capacity at the mine and increase
production was to establish additional mining sectors. The
development of La Paloma, Quebrada Colorada Sur and Pampa
Campamento Deep was an important component of that strategy;
accessing these new areas has now provided increased mining
flexibility. With improved access now in place, and development
rates able to support throughput, the Company expects more
consistent quarter-over-quarter production in 2022 as compared to
2021.
Quarterly total cost of sales, cash costs(1) and
AISC(1) per GEO(2) of $929, $582, and $761, respectively, were all
well below annual cost guidance ranges and all decreased
year-over-year, as a result of the planned higher development
rates, that facilitated access to additional mining areas in the
second half of the year. For the year, total cost of sales, cash
costs(1) and AISC(1) per GEO(2) were $1,054, $673, and $932,
respectively. With the ongoing focus on increasing mine development
rates, El Peñón has increased the number of available underground
production zones which are expected to support the current level of
mine production and feed grades going forward. Mine development is
currently occurring at a rate that exceeds 3,000 metres per
month.
Minera Florida
Minera Florida reported gold production of
18,247 ounces during the fourth quarter, and 84,768 ounces for the
year, in line with the previously provided guidance range.
Production was partially affected in December by a strike which
ended in January when the Company entered into a long term
collective bargaining agreement with its unions. During the year,
Minera Florida has seen improved operational efficiency and reduced
haulage distances as a result of re-establishing ore passes.
Widening of the final ore pass at Fantasma/Polvorin was completed
during October, which will further reduce haulage distances and
possibly allow for optimizing the hauling fleet. Internalization of
mining activities, ongoing optimization of the haulage
infrastructure, and increasing disposal storage of development
waste into underground voids will further improve mine productivity
going forward. A review of the processing plant in the first
quarter identified several opportunities to increase recovery.
Management is prioritizing these opportunities, focusing on the
initiatives that can be implemented quickly with minimal
investment.
Consistent with the 10-year outlook, the plant
de-bottlenecking study is advancing on schedule, with the objective
to increase throughput from 74,500 to 100,000 tonnes per month,
thereby increasing annual gold production to approximately 120,000
ounces. The Company submitted the ESIA for the expansion during the
fourth quarter, with the timeline expected to be approximately 18
months for approval, with another 12 months to receive sectoral
permits. With the expected permitting timelines, the mine could
begin operating at a planned 100,000 tonnes per month level in
2025. Preliminary studies indicate that the capacity of the
processing plant can be increased to approximately 90,000 tonnes
per month with incremental adjustments. An upgrade of the crushing
circuit would be required to achieve 100,000 tonnes per month. For
additional details, please refer to the Company's ten-year outlook
in its announcement issued February 17, 2022 titled: 'Yamana Gold
provides 2022-2024 guidance and an update to its ten-year outlook
highlighting a sustainable production platform with significant
growth'.
Total cost of sales, cash costs(1) and AISC(1)
per GEO(2) during the fourth quarter were $1,535, $911, and $1,313
respectively. Total cost of sales, cash costs(1) and AISC(1) per
GEO(2) during the year were $1,434, $881 and $1,224 respectively.
Costs are expected to improve in 2022 due to higher grades, and
higher silver and zinc by-product credits. In addition to the
aforementioned plant improvements, the Company completed a
processing plan earlier in the year, which identified opportunities
to implement cost control initiatives; these are currently under
consideration and may positively impact future costs.
CONSTRUCTION, DEVELOPMENT AND ADVANCED
STAGE PROJECTS
Wasamac Project Update and Positive
Exploration Results
On July 19, 2021, the Company announced the
results of several studies on the Company’s wholly-owned Wasamac
project in the Abitibi-Témiscamingue Region of Quebec, Canada,
intended to corroborate diligence reviews conducted by the Company
on its purchase of the project in early 2021, and update a
historical feasibility study. These studies updated the baseline
technical and financial aspects of the Wasamac project that now
underpin the decision to advance the project to production. The
results from all studies were consistent with the Company’s
conclusions in its diligence reviews relating to the purchase of
Wasamac and, in some cases, are better than the conclusions from
those reviews.
The Company has decided to advance the bulk
sample permitting process for Wasamac and expects to obtain the
required approvals in the first quarter of 2023. The bulk sample
permit would allow construction to commence on the ramp, enabling
earlier access to the deposit to increase the level of confidence
in metallurgical and geotechnical assumptions and optimize the
processing flow sheet and mining sequence. Construction on surface
facilities to support the ramp development activity and associated
environmental requirements would also advance.
The bulk sample was not considered in the
feasibility study base case and initiating the process has the
potential to further enhance the economics and mitigate risks of
the project. Additional benefits of the bulk sample include:
- Build production-ready models for
the grade, recovery, and geotechnical aspects of the project, to
support the first three years of production.
- Capture opportunities to optimize
the processing performance, as preliminary results of optimization
studies indicate the potential to improve average gold recovery by
3%, and up to 5.5% for certain zones of the deposit.
- Confirm stope stability parameters
to optimize stope dimensions, backfilling strategy and mining
sequence while contributing to ensuring a safe working
environment.
- Establish drilling platforms to
perform delineation and exploration drilling at Wasamac, Wildcat
and new zones from underground.
The Company relies on a collaborative approach
to ensure the success of Wasamac. In this regard, our environmental
assessment process is conducted in collaboration with our
stakeholders, including neighbors, and First Nations. A community
relations office has now been established to further facilitate
ongoing engagement with local residents and accessibility to the
Company's team, as well as providing up-to-date information on the
project. A campaign of environmental baseline data collection is
currently underway. Completion of all work for the submission of
the Environmental Impact Assessment (“EIA”) is expected in the
second quarter of 2022, with the filing expected by the end of
2022.
Exploration activities continued to ramp up
during the fourth quarter, with a focus on infill drilling on the
Wasamac resource, with 19,466 metres in 19 drill holes completed.
Total infill drilling completed in 2021 was 21,649 metres in 31
drill holes. Three drill rigs are currently operating to advance
the infill drilling program, and a fourth rig is planned to be
added in the first quarter of 2022. Drilling completed in the
fourth quarter also included 2,293 metres of geotechnical drilling
in 28 drill holes in the ramp area, bringing total geotechnical
drilling completed in 2021 to 6,463 metres in 36 drill holes. No
additional exploration drilling was completed in the fourth
quarter, as pending results are forthcoming. Exploration drilling
completed in 2021 totaled 7,291 metres in 22 holes, divided between
the West Wasa Shear offset, Wildcat, Wildcat South and West 117
Wasa targets.
Exploration drilling results received during the
fourth quarter included a high-grade intercept over underground
mining widths at the newly defined Wildcat South target, located
approximately 300 metres south of Wildcat. Wildcat South is a
magnetic anomaly generated from a recently completed, property wide
high-resolution (25 metre) helicopter-borne magnetic survey
covering 2,992 line-kilometres. As previously reported in the
December 1, 2021 press release 'Yamana Gold Announces The Discovery
Of New Mineralized Zones At Wasamac And Provides An Update On Its
Growth Projects', drill hole WS-21-524 intercepted two new
mineralized zones, including an upper mineralized interval that
returned 7.31 g/t of gold over an estimated true width of 3.37
metres at a downhole depth of 402.93 metres. This high-grade zone
was followed further down hole by two mineralized intervals within
a 30 metre wide chlorite-sericite-pyrite altered shear zone
returning assays of 2.3 g/t of gold over a core length of 0.60
metres and 1.3 g/t of gold over a core length of 0.30 metres.
Results from Wildcat South will be integrated into exploration
models and followed up as exploration drilling is restarted in
early 2022. Drilling completed at West 117 Wasa intersected mostly
narrow, rhyolite-hosted shear zones. Assay results are pending for
these drill holes. Additional results from exploration drilling are
expected in the first quarter 2022.
Additional ongoing exploration work completed
during the fourth quarter included integration of the merged
high-resolution magnetic survey data over the Wasamac and Francoeur
properties with project wide data compilation and targeting. A two
year schedule and long-term exploration strategy for the combined
properties is being developed. Positions of senior project
geologist, project geologist and surface exploration geologist have
been filled. Additional, ongoing work included continued sampling
of select, previously unassayed, historic drill hole intervals
hosting stockwork style mineralization, to assess for their
potential to contribute to the mineral resource base.
The Wasamac project further solidifies the
Company’s long-term growth profile with a top-tier gold project in
Quebec’s Abitibi-Témiscamingue Region, where Yamana has deep
operational and technical expertise and experience. Wasamac is
envisaged to have a production platform of 200,000 ounces per year
with AISC(1) below $850 per ounce over a mine life of at least 15
years. Yamana’s average annual gold production in Quebec, including
production from Wasamac and the Odyssey underground at Canadian
Malartic, has the potential to increase to approximately 500,000
ounces by 2028, and continue at this level through 2041.
The Odyssey Project Advancing on
Schedule
Yamana and Agnico Eagle Mines Ltd., who each
hold a 50% interest in the Canadian Malartic General Partnership,
owner and operator of the Canadian Malartic mine, announced a
positive construction decision for the Odyssey underground project
at Canadian Malartic on February 11, 2021.
The project advanced significantly in 2021, with
several milestones achieved in the fourth quarter. The project
continues to be on budget, and on schedule.
- In October, the concrete pour to
construct the 93-metre-tall headframe was completed on schedule, in
preparation for shaft sinking slated to begin in the fourth quarter
of 2022. Structural steel installation inside the headframe and
construction of the fresh air intake is ongoing. The production
shaft will be 6.5 metres in diameter and 1,800 metres deep, with
the first of two loading stations at 1,135 metres below surface.
The sinking hoist and auxiliary hoist are expected to be delivered
mid-2022.
- In parallel, underground
development is advancing according to plan and, as of the end of
2021, the ramp from surface to the upper zones has reached the
elevation of the third production level and the base of the first
stoping horizon. Underground development rates increased in the
fourth quarter of 2021 to approximately 400 metres per month with
the opening of additional headings and implementation of automated
scoops to operate between shifts, achieving a total of 2,081 linear
metres for the year. Development rates are planned to increase
further in 2022 with the addition of the Canadian Malartic
development crews. The first development jumbo drill is scheduled
to be delivered in February and, as an employer of choice in the
Abitibi, the Odyssey project is successfully building a highly
skilled team. Priority will continue to be placed on the main ramp
and also the level 16 exploration drift for infill drilling of the
Odyssey South and Internal zones. The first underground ore from
Odyssey South is on track to be processed through the existing
Canadian Malartic plant in early 2023.
- Construction of surface
infrastructure is advancing on schedule with critical preparation
works completed in the fourth quarter to allow construction to
continue as planned throughout the winter. Construction of the
surface workshop, warehouse and compressor buildings are ongoing
and construction of the paste fill plant is scheduled to commence
in February. Most long-lead items have been secured. Decree
amendment and the mining lease process continue to be on target for
the first quarter of 2022 and fourth quarter of 2022
respectively.
Jacobina Processing Capacity
Optimization and Expansion
The phased expansion of the Jacobina mine in
Brazil is expected to establish a gold production platform of up to
at least 270,000 ounces per year. Jacobina’s large inventory of
mineral reserves and mineral resources continues to grow faster
than mining depletion, providing the basis for a multi-decade
strategic mine life at low costs and increasing cash flow.
In 2021, the Company initiated a simplified
approach to the Phase 2 expansion to continue incremental
debottlenecking and operational improvements, without requiring an
expansion of the grinding circuit as originally contemplated. The
simplified expansion approach is a continuation of the strategy
that has been the basis for the quarter-over-quarter success of
Jacobina over the past several years, and is expected to de-risk
the project and require significantly lower capital than originally
planned in the Phase 2 pre-feasibility study, an amount not
expected to exceed $15 million to $20 million.
The Phase 2 expansion is progressing ahead of
schedule. During the fourth quarter, Jacobina received the
expansion permit, allowing throughput to increase to 10,000 tpd, as
announced in the December 6, 2021 press release 'Yamana Gold
Receives Permit at Jacobina, Initiating Ramp Up of Phase 2
Expansion, Expects Fourth Quarter Company Wide Production to Exceed
270,000 GEO With Costs Tracking to Be the Lowest of the Year'. The
successful result is the culmination of a two-year process during
which the Company worked closely with government agencies to ensure
that Jacobina continues to operate in a responsible, sustainable
way to the benefit of all stakeholders. The Company has
strategically elected to operate in the Americas in rules-based
jurisdictions with a mining pedigree providing certainty for
conducting its operations which has been exemplified with the
Brazilian permitting process for Jacobina. Receipt of the permit
not only marks a significant milestone in the Phase 2 ramp up to
230,000 ounces of gold per year, but also facilitates the future
Phase 3 expansion to increase production up to 270,000 ounces per
year.
The underground mining rate continues to
increase and with the accelerated permitting and 2021
outperformance, the mine is now expected to achieve the Phase 2
throughput objective of 8,500 tpd by the second quarter of 2022,
approximately one year ahead of schedule, although higher
throughput will be supported by stockpiles during the year.
Following receipt of the permit, Jacobina increased throughput to
7,771 tpd in December, achieving an average throughput of 7,610 tpd
for the fourth quarter. Grade normalizes in 2023 when production is
expected to reach 230,000 ounces. Since May 2021, throughput has
been stable at the previously-permitted rate of 7,500 tpd and the
mine is well positioned to immediately start ramping up to 8,500
tpd. Over the same time frame, Jacobina has continued with
incremental improvements to increase mining and processing capacity
in anticipation of receiving the expansion permit. As such, the
Company intends to progressively increase throughput over the next
six to seven months.
The ramp up to 8,500 tpd will be achieved
through a continuation of incremental improvements to de-bottleneck
the processing plant. Optimization of the crushing circuit which
did not require the installation of new equipment is already
complete. During the first half of 2022 several additional
initiatives are expected to be completed including optimizing the
grinding process with the installation of ultrasonic density meters
to optimize ore feed control to the mills and increasing the
capacity of the electrowinning circuit. In 2023, further
initiatives could be undertaken to support recovery rates at the
higher throughput level but depending on performance, some of these
initiatives may have the flexibility to be deferred until the Phase
3 expansion.
Cerro Moro Scalable Plant and Heap
Leaching Upside Opportunities
Cerro Moro has a significant inventory of
lower-grade veins that are not fully reflected in the current
mineral reserves and mineral resource statements, many of which are
wider than the veins currently being mined. Drilling of these lower
grade veins was not typically followed up with infill drilling in
the past as the mineralization is below the current cut-off grade.
Cerro Moro was developed as a high-grade, low-tonnage operation
but, from the beginning, the Company has considered alternative
processing options to allow for economic extraction of lower grade
mineralization, including:
- a scalable plant, where the front
end of the plant anticipates higher 2,000 tpd tonnage, with the
expectation of modest capital requirement to achieve this
objective,
- heap leaching near-surface,
lower-grade material, to supplement other production.
During the fourth quarter, Yamana advanced the
plant expansion study with a trade-off of various comminution
circuit configurations to optimize the expansion processing flow
sheet. Similar to the approach that has proven successful at
Jacobina, the Company is considering a low-risk, phased expansion
for Cerro Moro with quick payback from the initial phase used to
fund subsequent phases. As such, the Company is considering using
fine screens instead of cyclones for classification to improve the
efficiency of the existing ball mill. Combined with a slightly
coarser grind size, this initial phase is expected to increase
throughput to at least 1,500 tpd, a 40% to 50% increase in
capacity, without impacting gold and silver recoveries. The
incremental capacity could be used for processing of lower grade
mineralization, which is expected to increase annual gold and
silver production and reduce unit processing and G&A operating
costs. Preliminary analysis based on current operating data
indicates that the existing crushing and flotation circuits are
adequate for the higher throughput rate and reconfiguration of the
leaching circuit could achieve the target throughput without
requiring additional leach tanks. Upgrades to the concentrate
thickener, clarifying filters, flocculant make-up system, and
pumping would likely be required. The capital cost of this initial
phase is estimated at a modest $15 million to $20 million dollars.
Many of the upgrades in phase 1 expansion would be sufficient for a
second expansion phase to increase plant throughput to
approximately 2,200 tpd, double the existing capacity, further
increasing production and reducing operating unit costs. The
Company is currently evaluating two options for phase 2 expansion,
the addition of a high pressure grinding rolls ("HPGR") unit before
the existing ball mill or the addition of a regrind unit. An
expansion of the flotation circuit would also be required. The
selected option will depend on the results of testwork that is
currently underway and expected to be completed by the end of the
first quarter, after which cost estimates and economic evaluation
will be completed. The Company will advance the selected phase 1
and phase 2 expansion options to a pre-feasibility study level,
expected for completion in early 2023.
Positive exploration results achieved throughout
2021 successfully replaced depletion of mineral reserves for the
first time, as reflected in increased mineral reserves and mineral
resources at year-end, turning the corner for the operation.
Significantly, the expansion of higher-grade veins, both within the
core mine at Zoe and Martina, and outside the core mine at Naty,
extends the Cerro Moro mine life at the current gold equivalent
feed grade and existing throughput rate of approximately 1,100
tonnes per day. Additional high-grade targets identified in 2021
provide a pipeline of opportunities for continued mineral reserves
replacement going forward which supports the plant expansion
opportunity. Lastly, at a higher level of throughput, the Company
may be able to create a greater inventory of mineral resources,
focused on a balance between high grade and more mineral resources,
rather than grade alone.
In parallel, a technical study on the potential
heap leach project is underway following promising results from
metallurgical testing conducted in 2021. A four-month cyanide
column leach test program was conducted on eight samples with gold
grades of 0.71 to 3.22 grams per tonne ("g/t") and at three
different sizes of feed materials, -25 mm, -19 mm and -9.5 mm. The
results indicate good potential for leaching of both oxidized
near-surface vein material, zones with hypogene oxides (hematite)
and some low sulphide gold-bearing veins, with extractions from
column leaching varying from 32.5% to 96.9%, averaging 68.6%. Gold
recoveries at the Domos La Union and Michelle zones were
particularly impressive, averaging 85.6% from the four samples. As
a result, exploration is focusing on these zones, with an objective
of defining a heap leachable inventory of 5 million tonnes.
Conceptual engineering for a 5,000 tpd heap leach operation
commenced in the fourth quarter. A conventional heap leach
configuration is envisaged with three stages of crushing to a
crushed size P80 of 12.5 mm, followed by agglomeration and retreat
conveyor stacking in a multiple lift, single use pad with a design
capacity of approximately 14 million tonnes. The leach pad,
solution storage ponds, and Merrill-Crowe plant are conceptually
planned to be located approximately 2 kilometres east of the
current tailings storage facility. Average feed grade is estimated
at approximately 1.0 to 1.4 g/t of gold, adding 45,000 to 65,000
ounces of gold production per year in addition to gold and silver
production from the existing processing plant. Conceptual capital
and operating cost estimation is expected to be completed in the
second quarter, and an initial mineral inventory estimate, based on
results from 2021 drilling, is planned for mid-2022.
As Cerro Moro’s mineral inventory increases, the
Company will evaluate its options for alternative sources of power,
which include a connection to the grid and wind power. Both options
are expected to improve costs and further reduce GHG emissions,
thereby accelerating the achievement of the Company’s carbon
emissions reduction goal. This area of southern Argentina is one of
the most prospective areas in the world for wind-based energy
generation; the Company’s third-party process to evaluate wind
power indicates there should be a sufficient and sustainable supply
of power. The results of the alternative power analysis will be
considered in the plant expansion pre-feasibility and heap leach
studies to explore synergies between the projects. Based on
preliminary analysis, the Company believes that the conversion of
approximately twenty-five per cent of Cerro Moro's power sources to
wind would significantly contribute to the carbon reduction goals
of the Company to achieve net zero emissions.
The objective at Cerro Moro is to create a
sustainable ten-years of production of at least 160,000 GEO(2) per
year, and up to 200,000 GEO(2) per year. If the Company
successfully develops both the plant expansion and heap leach
projects, which represent significant upside opportunities, along
with conversion of the exploration targets to mineral resources,
Cerro Moro could produce at least 200,000 GEO(2) per year. This
upside would be beyond the current ten-year outlook that assumes
Cerro Moro as a 150,000 to 165,000 GEO(2) per year operation, which
is expected to be sustainable from mineral reserves mine life,
ongoing exploration successes and mineral reserve replacement.
MARA Project Advances
The MARA Joint Venture held by the Company
(56.25%), Glencore International AG (25%) and Newmont Corporation
(18.75%) continues to advance engagement with local communities and
stakeholders, and progress the feasibility study and the permitting
process. The pending feasibility study will provide updated mineral
reserves, production and project capital cost estimates, and is
being overseen by the Technical Committee comprised of members of
the three joint venture companies. The full feasibility study
report and submission of the ESIA are expected in late 2022.
MARA is the combined project comprised of the
Agua Rica site, Alumbrera site, as well as the Alumbrera plant and
ancillary buildings and facilities, and will rely on processing ore
from the Agua Rica mine at the Alumbrera plant. The project design
minimizes the environmental footprint of the project, incorporating
the input of local stakeholders. MARA is planned to be a
multi-decade, low-cost copper-gold operation with annual production
in the first ten years of 556 million pounds of copper equivalent
and a life of mine annual production of 469 million pounds of
copper equivalent on a 100% basis. MARA will be among the top 25
copper producers in the world when in production, and one of the
lowest capital intensity of comparable projects globally.
Work during 2021 focused on advancing the
feasibility study engineering, mine design and planning,
metallurgical and geotechnical drilling campaigns and field work at
site. MARA has also been advancing baseline social and
environmental studies, as well as permitting and working with local
stakeholders. During 2021, field work progressed well with the
ongoing drilling campaign completing more than 50% of the drill
holes planned, totaling 6,190 meters. All the geometallurgical and
geotechnical drill holes in the pit area have been completed, as
well as extensive field surveys and technical assessments from
different engineering disciplines. Preliminary results are positive
and aligned with the expected parameters, confirming grade
distribution on existing models. The field work plan continues,
with the drilling campaign now covering the Agua Rica
infrastructure and is expected to be completed by mid-2022.
The Company is also planning to perform deep
drill holes in 2022 to check the extension of high-grade
chalcopyrite mineralization that could potentially unlock a pit
expansion of Agua Rica, as well as to test for deep extensions of
mineralization in the hypogene area of the porphyry, given the
deposit is open at depth and relatively unexplored beyond the
supergene zone.
The metallurgical field drilling program has
been completed and all metallurgical drill core samples have been
shipped for metallurgical test work in Canada. Assaying of all
samples has been completed with the metallurgical test program now
underway. The initial test work results received are well aligned
with previous results and expectations. The current bench-scale
work will be followed by pilot plant investigations that will also
generate samples of final concentrate and process plant tailings
required for third party testing and equipment sizing by the
various major equipment vendors. The program is planned to be
completed in the second quarter of 2022.
Opportunities Providing Upside
The most recent technical studies indicate that
the processing facility at Alumbrera is capable of processing up to
44.0 million tonnes per year, with minor additional capital
expenditures, which represents a significant upside to the
pre-feasibility study results. Further tests and studies are being
advanced for the feasibility study stage to confirm and optimize
these results. Mine engineering work completed to date includes
mine design and mine sequencing optimizations, and an updated
preliminary production plan at the higher throughput rate. Efforts
on the mining area during 2022 will be focused on updates of the
resource model with the new field information and subsequent
updates to the mine plan, as well as to continue advancing the
engineering of the mine infrastructure.
Project engineering work has advanced on many
fronts to a full feasibility study-level of definition. These
include the mining area interface, primary crushing and overland
conveying system to the existing Alumbrera plant. Mechanical
layouts and process and instrumentation diagrams have been
completed and detailed earthworks, foundation and structural steel
designs are underway. Supplemental geotechnical drilling for the
ore transportation tunnel access started recently and the detailed
tunnel design will be advanced upon availability of updated field
information.
Parallel to the exploration program, MARA is
conducting field campaigns to complement the ESIA baseline data.
Preliminary results and advancement of the project are being shared
with the Intergovernmental Commission of Catamarca, prior to filing
the full ESIA. The Company plans to complete the ESIA for MARA in
the second half of 2022. The estimated remaining expenses for the
Company to advance the project through the feasibility study and
ESIA are approximately $13.0 million (Yamana's 56.25% interest),
representing a manageable and modest investment in relation to the
value creation of advancing the MARA Project to the next phases of
development.
During the last year, several proposals were
presented to the Company for its interest in MARA and, after
consideration, the board determined that any strategic initiatives
will be considered closer to the completion of the feasibility
study and application for permitting later this year as the
certainty of the project from these events is expected to create
more value for the project.
The MARA project represents a significant
strategic value opportunity and a solid development and growth
project. The Company intends to pursue all available avenues to
continue to advance and unlock its value through its controlling
interest.
EXPLORATION
During the fourth quarter, exploration drilling
and other field activities continued as planned in most
jurisdictions, as successful COVID-19 prevention, monitoring,
testing and quarantine, and contact tracing protocols, as well as
further increases to the high levels of employee and contractor
vaccination rates, continued across the Company’s operations. The
Company is currently refocusing its efforts on regional exploration
projects, with greater efforts being placed on Jacobina and Lavra
Velha, which represent the best opportunities for advancement of
the goals of the generative exploration program. Drilling
activities continued in the fourth quarter in Brazil at Lavra Velha
and Jacobina Norte. Targets were advanced at the Company’s
Ivolandia, Colider and Arenopolis projects, with collection of soil
and rock samples and geological mapping at several targets. An
airborne geophysical survey will be flown over a 210 square
kilometre area at Ivolandia in early 2022. Exploration in Chile in
the fourth quarter included surface evaluation and target
development on several early-stage Yamana projects near the El
Peñón mine and elsewhere. Surface samples collected during the
quarter across all projects in Chile totaled 1,243 rock and 932
soil and stream sediment samples. 147 days of geological mapping
were completed. Preliminary assay results have been received for
several projects which will determine which projects are advanced
in 2022. In Argentina, permitting and contracting work continued in
preparation for drilling on the Company’s Las Flechas property,
where a 1,500-2,000 metre drill program to test breccia-related
high-sulphidation epithermal gold and porphyry copper gold targets
has been rescheduled for late in 2022 with an aggressive geological
and geochemical program planned. At Monument Bay, Manitoba, results
from the recently completed deep drilling program are being
evaluated with planning for the next steps for the project.
Further, exploration drilling continued at the recently acquired
advanced Wasamac property, in the Abitibi-Témiscamingue Region,
Quebec, where ongoing exploration drilling has identified new zones
of mineralization at the Wildcat South target. Initial field work
continued on the recently developed Orogen Royalties Inc. Nevada
Alliance and Raven-Callaghan property option.
FINANCIAL SUMMARY AND KEY
STATISTICS
Key financial and operating statistics for the
fourth quarter and full year 2021 are outlined in the following
tables.
(In millions of United States Dollars, except for per share and per
unit amounts) |
Three months ended December 31 |
Year Ended December 31, |
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
Revenue |
$ |
503.8 |
|
$ |
461.8 |
|
$ |
1,815.4 |
|
$ |
1,561.0 |
|
Cost of sales excluding
depletion, depreciation and amortization |
|
(180.0 |
) |
|
(166.8 |
) |
|
(695.0 |
) |
|
(614.1 |
) |
Depletion, depreciation and
amortization |
|
(125.7 |
) |
|
(112.5 |
) |
|
(447.9 |
) |
|
(395.0 |
) |
Total cost of sales |
|
(305.7 |
) |
|
(279.3 |
) |
|
(1142.9 |
) |
|
(1009.1 |
) |
Net reversal of impairment of
mining properties |
|
— |
|
|
191.0 |
|
|
— |
|
|
191.0 |
|
Temporary suspension, standby
and other incremental COVID-19 costs |
|
(8.7 |
) |
|
(9.2 |
) |
|
(37.4 |
) |
|
(40.5 |
) |
Mine operating earnings |
|
189.4 |
|
|
364.3 |
|
|
635.1 |
|
|
702.4 |
|
General and administrative
expenses |
|
(20.0 |
) |
|
(23.4 |
) |
|
(74.8 |
) |
|
(85.9 |
) |
Exploration and evaluation
expenses |
|
(6.8 |
) |
|
(6.0 |
) |
|
(31.6 |
) |
|
(15.1 |
) |
Net earnings attributable to
Yamana equity holders |
|
109.7 |
|
|
103.0 |
|
|
147.5 |
|
|
203.6 |
|
Net earnings(3) per share -
basic and diluted(i) |
|
0.11 |
|
|
0.11 |
|
|
0.15 |
|
|
0.21 |
|
Cash flow from operating
activities |
|
238.2 |
|
|
181.5 |
|
|
742.3 |
|
|
617.8 |
|
Cash flow from operating
activities before changes in non-cash working capital |
|
230.8 |
|
|
207.4 |
|
|
784.6 |
|
|
688.7 |
|
Revenue per ounce of gold |
$ |
1,796 |
|
$ |
1,875 |
|
|
1,799 |
|
|
1,777 |
|
Revenue per ounce of
silver |
$ |
23.24 |
|
$ |
24.02 |
|
|
24.85 |
|
|
21.11 |
|
Average realized gold price
per ounce(1) |
$ |
1,796 |
|
$ |
1,875 |
|
$ |
1,799 |
|
$ |
1,777 |
|
Average
realized silver price per ounce(1) |
$ |
23.24 |
|
$ |
24.02 |
|
$ |
24.59 |
|
$ |
20.93 |
|
(i) For the three months
and year ended December 31, 2021, the weighted average number of
shares outstanding was 961,185 thousand (basic) and 962,695
thousand (diluted), and 963,393 thousand (basic) and 964,932
thousand (diluted), respectively.
Reconciliation of Net
Earnings(3) to Adjusted Net
Earnings(1)(3)
(In millions of United States Dollars, except per share amounts,
totals may not add due to rounding) |
Three months ended December 31 |
Year Ended December 31, |
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
Net earnings(3) |
$ |
109.7 |
|
$ |
103.0 |
|
$ |
147.5 |
|
$ |
203.6 |
|
|
|
|
|
|
Adjustments(3) |
|
|
|
|
Net foreign exchange (gains) losses |
$ |
(8.9 |
) |
$ |
21.9 |
|
$ |
(12.2 |
) |
$ |
21.6 |
|
Share-based payments/mark-to-market of deferred share units |
|
2.2 |
|
|
3.4 |
|
|
3.2 |
|
|
31.5 |
|
Mark-to-market losses (gains) on derivative contracts, investments
and other assets and liabilities |
|
0.2 |
|
|
(5.8 |
) |
|
0.3 |
|
|
(6.9 |
) |
Gain on sale of subsidiaries, investments and other assets |
|
— |
|
|
(3.0 |
) |
|
— |
|
|
(1.4 |
) |
Gain on discontinuation of the equity method of accounting |
|
— |
|
|
— |
|
|
(10.2 |
) |
|
(21.3 |
) |
Temporary suspension, standby and other incremental COVID-19
costs |
|
8.7 |
|
|
9.2 |
|
|
37.4 |
|
|
40.5 |
|
Net pre-tax impairment reversal of mining properties |
|
— |
|
|
(191.0 |
) |
|
— |
|
|
(191.0 |
) |
Early note redemption premium |
|
— |
|
|
— |
|
|
53.3 |
|
|
— |
|
Other provisions, write-downs and adjustments |
|
(0.1 |
) |
|
6.7 |
|
|
9.9 |
|
|
17.9 |
|
Non-cash tax on unrealized foreign exchange losses |
|
1.7 |
|
|
1.8 |
|
|
1.9 |
|
|
52.8 |
|
Income tax effect of adjustments |
|
(1.4 |
) |
|
(2.4 |
) |
|
(19.0 |
) |
|
(19.7 |
) |
One-time tax adjustments |
|
(10.6 |
) |
|
163.9 |
|
|
97.0 |
|
|
183.6 |
|
Total
adjustments(3) |
$ |
(8.2 |
) |
$ |
4.7 |
|
$ |
161.6 |
|
$ |
107.6 |
|
|
|
|
|
|
Adjusted net earnings(3) |
$ |
101.4 |
|
$ |
107.7 |
|
$ |
309.0 |
|
$ |
311.2 |
|
|
|
|
|
|
Net
earnings(3) per
share |
$ |
0.11 |
|
$ |
0.11 |
|
$ |
0.15 |
|
$ |
0.21 |
|
Total
adjustments(3) per
share |
$ |
(0.01 |
) |
$ |
— |
|
$ |
0.17 |
|
$ |
0.11 |
|
Adjusted net earnings(3)
per share |
$ |
0.11 |
|
$ |
0.11 |
|
$ |
0.32 |
|
$ |
0.32 |
|
For a full discussion of Yamana’s operational
and financial results and mineral reserve and mineral resource
estimates, please refer to the Company’s Management’s Discussion
& Analysis and Consolidated Financial Statements for the year
ended December 31, 2021, which are available on the Company's
website at www.yamana.com, on SEDAR at www.sedar.com and on EDGAR
at www.sec.gov.
Upcoming 2022 Investor
Events
The Company will be conducting several investor
events over the course of 2022 and will announce a further notice
with additional details ahead of each event.
On April 5th, 2022, the Company will host an
Investor Day where a progress update will be provided on the
Company's longer-term outlook as outlined in the press release
'Yamana Gold provides 2022-2024 guidance and an update to its
ten-year outlook highlighting a sustainable production platform
with significant growth' issued February 17, 2022.
The Company also plans to host two separate
in-person mine tours during the year. During the second quarter of
2022, the Company will conduct a mine tour featuring Canadian
Malartic and the Odyssey project as well as the Company's Wasamac
project. During the fourth quarter of 2022, the Company will host a
mine tour of El Peñón and Minera Florida.
Fourth Quarter and Full Year 2021
Conference Call
The Company will host a conference call and
webcast on Friday, February 18, 2022, at 9:00 a.m. ET.
Toll Free
(North America): |
1-800-806-5484 |
Toronto Local and International: |
416-340-2217 |
Toll Free (UK): |
00-80042228835 |
Passcode: |
4273395# |
Webcast: |
www.yamana.com |
Conference Call Replay
Toll
Free (North America): |
1-800-408-3053 |
Toronto Local and International: |
905-694-9451 |
Toll Free (UK): |
00-80033663052 |
Passcode: |
1447690# |
The conference call replay will be available
from 12:00 p.m. ET on February 18, 2022, until 11:59 p.m. ET on
March 18, 2022.
MINERAL RESERVE AND MINERAL RESOURCE
ESTIMATES
Mineral Reserves (Proven and
Probable)
The following table sets forth the Mineral
Reserve estimates for the Company’s mineral projects as at December
31, 2021.
Gold |
Proven Mineral Reserves |
Probable Mineral Reserves |
Total - Proven & Probable |
|
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
|
(000's) |
(g/t) |
oz. (000's) |
(000's) |
(g/t) |
oz. (000's) |
(000's) |
(g/t) |
oz. (000's) |
Canadian Malartic, Barnat & Other Zones (50%) |
21,466 |
0.84 |
580 |
28,758 |
1.28 |
1,188 |
50,225 |
1.09 |
1,767 |
Canadian Malartic Underground (50%) |
— |
— |
— |
— |
— |
— |
— |
— |
— |
Canadian Malartic (50%) |
21,466 |
0.84 |
580 |
28,758 |
1.28 |
1,188 |
50,225 |
1.09 |
1,767 |
Jacobina |
28,910 |
2.17 |
2,015 |
13,101 |
2.19 |
923 |
42,011 |
2.18 |
2,938 |
Cerro Moro |
365 |
9.27 |
109 |
1,384 |
7.82 |
348 |
1,749 |
8.12 |
457 |
El Peñón Ore |
421 |
6.70 |
91 |
4,996 |
5.09 |
817 |
5,417 |
5.21 |
908 |
El Peñón Stockpiles |
8 |
2.64 |
1 |
607 |
1.24 |
24 |
615 |
1.26 |
25 |
El Peñón Total |
429 |
6.62 |
91 |
5,603 |
4.67 |
841 |
6,032 |
4.81 |
933 |
Minera Florida Ore |
662 |
3.08 |
65 |
2,905 |
3.49 |
326 |
3,567 |
3.42 |
392 |
Minera Florida Tailings |
— |
— |
— |
1,248 |
0.94 |
38 |
1,248 |
0.94 |
38 |
Minera Florida Total |
662 |
3.08 |
65 |
4,153 |
2.73 |
364 |
4,815 |
2.78 |
430 |
Wasamac |
— |
— |
— |
23,168 |
2.56 |
1,910 |
23,168 |
2.56 |
1,910 |
Jeronimo (57%) |
6,350 |
3.91 |
798 |
2,331 |
3.79 |
284 |
8,681 |
3.88 |
1,082 |
MARA (56.25%) |
330,300 |
0.25 |
2,655 |
291,150 |
0.16 |
1,498 |
621,450 |
0.21 |
4,152 |
Total
Gold Mineral Reserves |
388,482 |
0.51 |
6,314 |
369,648 |
0.62 |
7,355 |
758,131 |
0.56 |
13,669 |
Silver |
Proven Mineral Reserves |
Probable Mineral Reserves |
Total - Proven & Probable |
|
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
|
(000's) |
(g/t) |
oz. (000's) |
(000's) |
(g/t) |
oz. (000's) |
(000's) |
(g/t) |
oz. (000's) |
Cerro Moro |
365 |
593.5 |
6,964 |
1,384 |
342.0 |
15,215 |
1,749 |
394.5 |
22,180 |
El Peñón Ore |
421 |
225.5 |
3,055 |
4,996 |
162.1 |
26,036 |
5,417 |
167.0 |
29,091 |
El Peñón Stockpiles |
8 |
140.0 |
35 |
607 |
13.2 |
257 |
615 |
14.8 |
292 |
El Peñón Total |
429 |
224.0 |
3,090 |
5,603 |
146.0 |
26,293 |
6,032 |
151.5 |
29,383 |
Minera Florida Ore |
662 |
20.2 |
430 |
2,905 |
21.4 |
1,998 |
3,567 |
21.2 |
2,428 |
Minera Florida Tailings |
— |
— |
— |
1,248 |
14.6 |
584 |
1,248 |
14.6 |
584 |
Minera Florida Total |
662 |
20.2 |
430 |
4,153 |
19.3 |
2,582 |
4,815 |
19.5 |
3,011 |
MARA (56.25%) |
330,300 |
3.0 |
32,070 |
291,150 |
2.6 |
24,618 |
621,450 |
2.8 |
56,689 |
Total
Silver Mineral Reserves |
331,757 |
4.0 |
42,555 |
302,289 |
7.1 |
68,708 |
634,046 |
5.5 |
111,264 |
Copper |
Proven Mineral Reserves |
Probable Mineral Reserves |
Total - Proven & Probable |
|
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
|
(000's) |
(% ) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
MARA (56.25%) |
330,300 |
0.57 |
4,151 |
291,150 |
0.39 |
2,503 |
621,450 |
0.49 |
6,654 |
Total
Copper Mineral Reserves |
330,300 |
0.57 |
4,151 |
291,150 |
0.39 |
2,503 |
621,450 |
0.49 |
6,654 |
Zinc |
Proven Mineral Reserves |
Probable Mineral Reserves |
Total - Proven & Probable |
|
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
|
(000's) |
(% ) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
Minera Florida Ore |
662 |
1.44 |
21 |
2,905 |
0.94 |
60 |
3,567 |
1.03 |
81 |
Minera Florida Tailings |
— |
— |
— |
1,248 |
0.58 |
16 |
1,248 |
0.58 |
16 |
Minera Florida Total |
662 |
1.44 |
21 |
4,153 |
0.83 |
76 |
4,815 |
0.91 |
97 |
Total
Zinc Mineral Reserves |
662 |
1.44 |
21 |
4,153 |
0.83 |
76 |
4,815 |
0.91 |
97 |
Molybdenum |
Proven Mineral Reserves |
Probable Mineral Reserves |
Total - Proven & Probable |
|
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
|
(000's) |
(% ) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
MARA (56.25%) |
330,300 |
0.030 |
218 |
291,150 |
0.030 |
192 |
621,450 |
0.030 |
411 |
Total
Molybdenum Mineral Reserves |
330,300 |
0.030 |
218 |
291,150 |
0.030 |
192 |
621,450 |
0.030 |
411 |
Mineral Resources (Measured, Indicated,
and Inferred)
The following tables set forth the Mineral
Resource estimates for the Company’s mineral projects as at
December 31, 2021.
Gold |
Measured Mineral Resources |
Indicated Mineral Resources |
Total - Measured & Indicated |
|
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
|
(000's) |
(g/t) |
oz. (000's) |
(000's) |
(g/t) |
oz. (000's) |
(000's) |
(g/t) |
oz. (000's) |
Canadian Malartic, Barnat & Other Zones (50%) |
130 |
0.72 |
3 |
2,174 |
1.31 |
92 |
2,304 |
1.28 |
95 |
Odyssey Underground (50%) |
— |
— |
— |
1,075 |
1.92 |
66 |
1,075 |
1.92 |
66 |
East Malartic Underground (50%) |
— |
— |
— |
5,539 |
2.04 |
364 |
5,539 |
2.04 |
364 |
East Gouldie Underground (50%) |
— |
— |
— |
5,974 |
3.88 |
745 |
5,974 |
3.88 |
745 |
Canadian Malartic Total
(50%) |
130 |
0.72 |
3 |
14,762 |
2.67 |
1,267 |
14,893 |
2.65 |
1,270 |
Jacobina |
30,281 |
2.40 |
2,339 |
19,372 |
2.36 |
1,468 |
49,652 |
2.38 |
3,807 |
Cerro Moro Mine |
177 |
5.26 |
30 |
760 |
3.58 |
87 |
937 |
3.89 |
117 |
Cerro Moro Heap Leach |
— |
— |
— |
— |
— |
— |
— |
— |
— |
Cerro Moro Total |
177 |
5.26 |
30 |
760 |
3.58 |
87 |
937 |
3.89 |
117 |
El Peñón Mine |
761 |
5.28 |
129 |
5,651 |
3.20 |
581 |
6,412 |
3.45 |
710 |
El Peñón Tailings |
— |
— |
— |
— |
— |
— |
— |
— |
— |
El Peñón Stockpiles |
— |
— |
— |
1,019 |
1.13 |
37 |
1,019 |
1.13 |
37 |
El Peñón Total |
761 |
5.28 |
129 |
6,670 |
2.88 |
618 |
7,430 |
3.13 |
748 |
Minera Florida |
1,425 |
5.24 |
240 |
6,108 |
4.15 |
816 |
7,533 |
4.36 |
1,056 |
Wasamac |
— |
— |
— |
5,769 |
1.76 |
326 |
5,769 |
1.76 |
326 |
Jeronimo (57%) |
772 |
3.77 |
94 |
385 |
3.69 |
46 |
1,157 |
3.74 |
139 |
MARA (56.25%) |
95,447 |
0.26 |
786 |
121,198 |
0.12 |
459 |
216,645 |
0.18 |
1,245 |
La Pepa (80%) |
47,053 |
0.61 |
920 |
52,324 |
0.49 |
831 |
99,377 |
0.55 |
1,751 |
Monument Bay |
— |
— |
— |
36,581 |
1.52 |
1,787 |
36,581 |
1.52 |
1,787 |
Suyai |
— |
— |
— |
4,700 |
15.00 |
2,286 |
4,700 |
15.00 |
2,286 |
Total
Measured & Indicated Gold Mineral Resources |
176,046 |
0.80 |
4,541 |
268,629 |
1.16 |
9,992 |
444,675 |
1.02 |
14,532 |
Silver |
Measured Mineral Resources |
Indicated Mineral Resources |
Total - Measured & Indicated |
|
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
|
(000's) |
(g/t) |
oz. (000's) |
(000's) |
(g/t) |
oz. (000's) |
(000's) |
(g/t) |
oz. (000's) |
Cerro Moro Mine |
177 |
234.0 |
1,328 |
760 |
266.1 |
6,506 |
937 |
260.0 |
7,834 |
Cerro Moro Heap Leach |
— |
— |
— |
— |
— |
— |
— |
— |
— |
Cerro Moro Total |
177 |
234.0 |
1,328 |
760 |
266.1 |
6,506 |
937 |
260.0 |
7,834 |
El Peñón Mine |
761 |
150.9 |
3,691 |
5,651 |
113.5 |
20,625 |
6,412 |
118.0 |
24,316 |
El Peñón Tailings |
— |
— |
— |
— |
— |
— |
— |
— |
— |
El Peñón Stockpiles |
— |
— |
— |
1,019 |
28.8 |
942 |
1,019 |
28.8 |
942 |
El Peñón Total |
761 |
150.9 |
3,691 |
6,670 |
100.6 |
21,568 |
7,430 |
105.7 |
25,259 |
Minera Florida |
1,425 |
34.0 |
1,557 |
6,108 |
21.8 |
4,287 |
7,533 |
24.1 |
5,844 |
MARA (56.25%) |
30,150 |
1.6 |
1,502 |
116,044 |
1.9 |
6,940 |
146,194 |
1.8 |
8,442 |
Suyai |
— |
— |
— |
4,700 |
23.0 |
3,523 |
4,700 |
23.0 |
3,523 |
Total
Measured & Indicated Silver Mineral Resources |
32,513 |
7.7 |
8,079 |
134,282 |
9.9 |
42,823 |
166,795 |
9.5 |
50,902 |
Copper |
Measured Mineral Resources |
Indicated Mineral Resources |
Total - Measured & Indicated |
|
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
|
(000's) |
(% ) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
MARA (56.25%) |
95,447 |
0.28 |
591 |
121,198 |
0.30 |
791 |
216,645 |
0.29 |
1,383 |
Total
Measured & Indicated Copper Mineral Resources |
95,447 |
0.28 |
591 |
121,198 |
0.30 |
791 |
216,645 |
0.29 |
1,383 |
Zinc |
Measured Mineral Resources |
Indicated Mineral Resources |
Total - Measured & Indicated |
|
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
|
(000's) |
(% ) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
Minera Florida |
1,425 |
1.90 |
60 |
6,108 |
1.38 |
185 |
7,533 |
1.48 |
245 |
Total
Measured & Indicated Zinc Mineral Resources |
1,425 |
1.90 |
60 |
6,108 |
1.38 |
185 |
7,533 |
1.48 |
245 |
Molybdenum |
Measured Mineral Resources |
Indicated Mineral Resources |
Total - Measured & Indicated |
|
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
Tonnes |
Grade |
Contained |
|
(000's) |
(% ) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
(000's) |
(%) |
lbs (mm) |
MARA (56.25%) |
95,447 |
0.014 |
30 |
121,198 |
0.029 |
78 |
216,645 |
0.022 |
107 |
Total
Measured & Indicated Molybdenum Mineral Resources |
95,447 |
0.014 |
30 |
121,198 |
0.029 |
78 |
216,645 |
0.022 |
107 |
Gold |
Inferred Mineral Resources |
|
Tonnes |
Grade |
Contained |
|
(000's) |
(g/t) |
oz. (000's) |
Canadian Malartic, Barnat & Other Zones (50%) |
2,790 |
0.80 |
72 |
Odyssey Underground (50%) |
13,382 |
2.07 |
891 |
East Malartic Underground (50%) |
42,635 |
1.92 |
2,639 |
East Gouldie Underground (50%) |
30,825 |
3.07 |
3,046 |
Canadian Malartic (50%) |
89,632 |
2.31 |
6,647 |
Jacobina |
25,018 |
2.37 |
1,904 |
Cerro Moro Mine |
1,071 |
4.91 |
169 |
Cerro Moro Heap Leach |
416 |
4.28 |
57 |
Cerro Moro Total |
1,488 |
4.73 |
226 |
El Peñón Mine |
5,115 |
3.87 |
636 |
El Peñón Tailings |
13,767 |
0.55 |
245 |
El Peñón Stockpiles |
— |
— |
— |
El Peñón Total |
18,882 |
1.45 |
881 |
Minera Florida |
4,167 |
4.91 |
658 |
Wasamac |
3,984 |
2.01 |
258 |
Jeronimo (57%) |
1,118 |
4.49 |
161 |
MARA (56.25%) |
419,590 |
0.09 |
1,222 |
Arco Sul |
6,203 |
3.08 |
615 |
La Pepa (80%) |
20,019 |
0.46 |
293 |
Lavra Velha |
3,934 |
4.29 |
543 |
Monument Bay |
41,946 |
1.32 |
1,781 |
Suyai |
900 |
9.90 |
274 |
Total
Inferred Gold Mineral Resources |
636,880 |
0.76 |
15,463 |
Silver |
Inferred Mineral Resources |
|
Tonnes |
Grade |
Contained |
|
(000's) |
(g/t) |
oz. (000's) |
Cerro Moro Mine |
1,071 |
213.4 |
7,351 |
Cerro Moro Heap Leach |
416 |
60.4 |
808 |
Cerro Moro Total |
1,488 |
170.6 |
8,159 |
El Peñón Mine |
5,115 |
125.3 |
20,604 |
El Peñón Tailings |
13,767 |
18.9 |
8,380 |
El Peñón Stockpiles |
— |
— |
— |
El Peñón Total |
18,882 |
47.7 |
28,984 |
Minera Florida |
4,167 |
23.4 |
3,138 |
MARA (56.25%) |
417,881 |
1.6 |
21,765 |
Suyai |
900 |
21.0 |
575 |
Total
Inferred Silver Mineral Resources |
443,317 |
4.4 |
62,621 |
Copper |
Inferred Mineral Resources |
|
Tonnes |
Grade |
Contained |
|
(000's) |
(% ) |
lbs (mm) |
MARA (56.25%) |
419,590 |
0.23 |
2,125 |
Total
Inferred Copper Mineral Resources |
419,590 |
0.23 |
2,125 |
Zinc |
Inferred Mineral Resources |
|
Tonnes |
Grade |
Contained |
|
(000's) |
(% ) |
lbs (mm) |
Minera Florida |
4,167 |
1.20 |
111 |
Total
Inferred Zinc Mineral Resources |
4,167 |
1.20 |
111 |
Molybdenum |
Inferred Mineral Resources |
|
Tonnes |
Grade |
Contained |
|
(000's) |
(% ) |
lbs (mm) |
MARA (56.25%) |
419,590 |
0.030 |
277 |
Total
Inferred Molybdenum Mineral Resources |
419,590 |
0.030 |
277 |
Mineral Reserve and Mineral Resource
Reporting Notes
1. Metal Price, Cut-off Grade, Metallurgical Recovery:
Mine |
Mineral Reserves |
Mineral Resources |
Canadian Malartic (50%) |
Price assumption: $1,250 gold |
Price assumption: $1,250 gold |
|
Open pit cut-off grades range
from 0.41 to 0.42 g/t gold |
Canadian Malartic, Barnat and
other zones cut-off grades range from 0.31 to 0.42 g/t gold inside
pit, and from 1.15 to 1.20 g/t gold outside or below pit (stope
optimized) |
|
Metallurgical recoveries for gold
averaging 90.6% |
Underground cut-off grade at
Odyssey is 1.15 to 1.30 g/t gold (stope optimized) |
|
|
Underground cut-off grade at East
Malartic is 1.15 to 1.40 g/t gold (stope optimized) |
|
|
Underground cut-off grade at East Gouldie is 1.10 to 1.25 g/t gold
(stope optimized) |
Jacobina |
Price assumption: $1,250 gold |
Price assumption: $1,250 gold. Cut-off grades correspond to 75% of
the cut-off used to estimate the mineral reserves |
|
Underground reserves are reported
at variable cut-off grades by zone ranging from 0.92 g/t gold to
1.01 g/t gold |
Underground resources are
reported at variable cut-off grades by zone ranging from 0.69 g/t
gold to 0.76 g/t gold |
|
Metallurgical recovery is 96.2% |
Reported within optimized underground mining shapes with minimum
mining width of 1.5 metres and considering internal waste and
dilution |
Cerro Moro |
Price assumptions: $1,250 gold and $18.00 silver |
Price assumptions: $1,250 gold and $18.00 silver. NSR cut-off
values correspond to 75% of reserves cut-off |
|
Underground NSR cut-off at
$210.71/t and open pit NSR cut-off at $124.72/t |
Underground NSR cut-off at
$158.04/t and open pit NSR cut-off at $93.54/t |
|
Metallurgical recoveries average
93% for gold and 93% for silver |
Heap leach resource reported at
NSR cut-off value of $90.5/t (underground) and $26.0/t (open
pit) |
|
|
Constrained in optimized stopes and pit shells |
El Peñón |
Price assumptions: $1,250 gold, $18.00 silver |
Price assumptions: $1,250 gold, $18.00 silver |
|
Open Pit cut-off at $48.27/t |
Underground cut-off at $96.86/t,
which corresponds to 75% of the cut-off value used to estimate the
mineral reserves |
|
Underground cut-off at
$129.15/t |
Tailings and stockpiles reported
at cut-offs of 0.50 g/t and 0.79 g/t gold equivalent
respectively |
|
Low grade stockpiles cut-off 0.86
g/t gold equivalent |
Metallurgical recoveries for
underground ores range from 84.39% to 96.12% for gold and from
68.76% to 91.03% for silver |
|
Metallurgical recoveries for open
pit ores are 89.39% for gold and 80.70% for silver |
Metallurgical recoveries for
tailings estimated to be 60% for gold and 30% for silver |
|
Metallurgical recoveries for
underground ores range from 84.39% to 96.12% for gold and from
68.76% to 91.03% for silver |
Metallurgical recoveries for
stockpiles estimated to be 88.0% for gold and 80.8% for silver |
|
Metallurgical recoveries for low
grade stockpiles are 95.2% for gold and 83.0% for silver |
|
Minera Florida |
Price assumptions: $1,250/oz gold, $18.00/oz silver and $1.25/lb
zinc |
Price assumptions: $1,250/oz gold, $18.00/oz silver and $1.25/lb
zinc |
|
Underground cut-off at
$92.07/t |
Underground mineral resources are
estimated at a cut-off value of $69.05/t, corresponding to 75% of
the cut-off used to estimate mineral reserves, for the Las
Pataguas, PVS, and Cucaracha zones which are constrained to
underground mining shapes. The remaining zones are reported
unconstrained at a NSR cut-off value of $92.07/t. |
|
Metallurgical recoveries of
91.99% for gold, 62.75% for silver, and 79.89% for zinc |
Metallurgical recoveries of
91.99% for gold, 62.75% for silver, and 79.89% for zinc |
Wasamac |
Price assumption: $1,250/oz gold |
Price assumption: $1,250 gold. Cut-off grades correspond to 75% of
the cut-off used to estimate the mineral reserves |
|
Underground cut-off grade from
1.45 to 1.68 g/t gold (stope optimized) |
Underground cut-off grades range
from at 1.10 to 1.30 g/t gold |
|
The external dilution is
estimated to be 11%. The average mining recovery factor was set at
93.6%. |
Mineral resources are below a 32
m surface crown pillar and outside a 5 m buffer around historical
underground workings |
|
|
Constrained by potentially mineable shapes based on a minimum
mining width of 2 m considering internal waste and dilution |
Jeronimo (57%) |
Price assumption: $900 gold |
|
|
Cut-off grade at 2.0 g/t
gold |
Cut-off grade at 2.0 g/t
gold |
|
Metallurgical recovery for gold is 86%. |
|
MARA: Agua Rica (56.25%) |
Mineral Reserves are estimated using a variable metallurgical
recovery |
Mineral Resources are estimated using a variable metallurgical
recovery |
|
Average metallurgical recoveries
of 86% Cu, 35% Au, 43% Ag, and 44% Mo were considered |
LOM average metallurgical
recoveries of 86% Cu, 35% Au, 43% Ag, and 44% Mo were
considered |
|
Open pit mineral reserves are reported at a variable cut-off value
averaging $8.42/t, based on metal price assumptions of $3.00/lb Cu,
$1,250/oz Au, $18/oz Ag, and $11/lb Mo. A LOM average open pit
costs of $1.72/t moved, processing and G&A cost of $6.70/t of
run of mine processed. The strip ratio of the mineral reserves is
1.7 with overall slope angles varying from 39° to 45° depending on
the geotechnical sector |
Mineral resources are constrained by an optimized pit shell based
on metal price assumptions of $4.00/lb Cu, $1,600/oz Au, $24/oz Ag,
and $11/lb Mo. Open pit Mineral Resources are reported at a
variable cut-off value which averages $8.42/t milled with overall
slope angles varying from 39° to 45° depending on the geotechnical
sector |
MARA: Alumbrera (56.25%) |
N/A |
Price assumptions: $1,300 gold, $2.83 copper |
|
|
Alumbrera deposit: Whittle pit
shell cut-off at 0.22% copper equivalent |
|
|
Bajo El Durazno deposit: 0.2 g/t Au cut-off within pit shell |
Arco Sul |
N/A |
Price assumption: $1,250 gold |
|
|
Underground cut-off grade at
2.00g/t, which corresponds to 75% of the cut-off that would be used
for mineral reserves |
|
|
Mineral resources reported within optimized underground mining
shapes |
La Pepa (80%) |
N/A |
Price assumption: $1,650 gold |
|
|
Cut-off grade of 0.20 g/t gold for oxides and 0.26 g/t gold for
sulphides, inside optimized pit envelope |
Lavra Velha |
N/A |
Price assumptions: $1,300 gold and $3.50 copper |
|
|
Cut-off grade at 0.2 g/t gold and 0.1% copper |
Monument Bay |
N/A |
Price assumption: $1,200 gold |
|
|
Cut-off grades are 0.4 g/t gold and 0.7 g/t gold for the open pits
and 4.0 g/t gold for underground |
Suyai |
N/A |
5.0 g/t gold cut-off inside mineralized wireframe modeling |
2. All Mineral Reserves and Mineral Resources
have been estimated in accordance with the standards of the
Canadian Institute of Mining, Metallurgy and Petroleum and National
Instrument 43-101.
3. All Mineral
Resources are reported exclusive of Mineral Reserves.
4. Mineral
Resources which are not Mineral Reserves do not have demonstrated
economic viability.
5. Mineral
Reserves and Mineral Resources are reported as of December 31,
2021.
6. For the
qualified persons responsible for the Mineral Reserve and Mineral
Resource estimates at the Company’s material properties, see the
qualified persons list below.
Property |
Qualified Persons for Mineral Reserves |
Qualified Persons for Mineral Resources |
Canadian Malartic |
Guy Gagnon, Eng., Canadian Malartic Corporation |
Pascal Lehouiller, P. Geo, Canadian Malartic
Corporation |
Jacobina |
Eduardo de Souza Soares, MAusIMM CP (Min), Yamana Gold Inc. |
Luiz Carlos Damasceno dos Santos, MAusIMM CP (Geo), Yamana Gold
Inc. |
El
Peñón |
Jimmy Avendaño Gonzalez, Registered Member of the Chilean Mining
Commission, Yamana Gold Inc. |
Marco Velásquez Corrales, Registered Member Chilean Mining
Commission, Yamana Gold Inc. |
Qualified Persons
Scientific and technical information contained
in this news release has been reviewed and approved by Sébastien
Bernier (P. Geo and Senior Director, Geology and Mineral
Resources). Sébastien Bernier is an employee of Yamana Gold Inc.
and a "Qualified Person" as defined by Canadian Securities
Administrators' National Instrument 43-101 - Standards of
Disclosure for Mineral Projects.
About Yamana
Yamana is a Canadian-based precious metals
producer with significant gold and silver production, development
stage properties, exploration properties, and land positions
throughout the Americas, including Canada, Brazil, Chile and
Argentina. Yamana plans to continue to build on this base through
expansion and optimization initiatives at existing operating mines,
development of new mines, the advancement of its exploration
properties and, at times, by targeting other consolidation
opportunities with a primary focus in the Americas.
FOR FURTHER INFORMATION, PLEASE
CONTACT:Investor Relations and Corporate Communications
416-815-02201-888-809-0925Email: investor@yamana.com
FTI Consulting (UK Public Relations)Sara Powell
/ Ben Brewerton +44 7931 765 223 / +44 203 727 1000Email:
Yamana.gold@fticonsulting.com
Credit Suisse (Joint UK Corporate Broker)Ben
Lawrence / David Nangle Telephone: +44 (0) 20 7888 8888
Joh. Berenberg Gossler & Co. KG (Joint UK
Corporate Broker)Matthew Armitt / Jennifer Wyllie / Detlir Elezi
Telephone: +44 (0) 20 3207 7800
Peel Hunt LLP (Joint UK Corporate Broker)Ross
Allister / David McKeown / Alexander AllenTelephone: +44 (0) 20
7418 8900
END NOTES
(1 |
) |
This is a non-GAAP financial performance measure. Refer to the
Non-GAAP Financial Performance Measures section at the end of this
news release. |
|
|
(2 |
) |
GEO is calculated as the sum of gold ounces and the gold equivalent
of silver ounces using a ratio of 77.28 and 72.55 for the three
months and year ended December 31, 2021, respectively, and 76.82
and 88.86 for the three months and year ended December 31, 2020,
respectively. GEO calculations for actuals are based on an average
market gold to silver price ratio for the relevant period. Guidance
GEO assumes gold ounces plus the equivalent of silver ounces using
a ratio of 72.00. |
|
|
(3 |
) |
Net earnings and adjustments to net earnings represent amounts
attributable to Yamana Gold Inc. equity holders. |
|
|
(4 |
) |
Yamana mines is defined as Yamana's currently held mines, which are
Canadian Malartic, Jacobina, Cerro Moro, El Peñón and Minera
Florida. |
|
|
(5 |
) |
Included in the year ended December 31, 2020 gold production figure
is 18,929 of pre-commercial production ounces related to the
Company's 50% interest in the Canadian Malartic mine's Barnat pit,
which achieved commercial production on September 30, 2020.
Pre-commercial production ounces are excluded from sales figures,
although pre-commercial production ounces that were sold during
their respective period of production had their corresponding
revenues and costs of sales capitalized to mineral properties,
captured as expansionary capital expenditures. |
|
|
(6 |
) |
Calculated on a 200,000 exposure hour basis, including employees
and contractors. This rate is exclusive of Canadian Malartic, in
which we hold a 50% interest. |
|
|
(7 |
) |
Vaccination rates are exclusive of Canadian Malartic, in which we
hold a 50% interest. Vaccination rates at Canadian Malartic are in
line with the high Abitibi-Témiscamingue regional rates. |
|
|
(8 |
) |
Cash balances include $217.3 million available for utilization by
the MARA Project. |
CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS: This news release contains or incorporates by reference
“forward-looking statements” and “forward-looking information”
under applicable Canadian securities legislation and within the
meaning of the United States Private Securities Litigation Reform
Act of 1995. Forward-looking information includes, but is not
limited to information with respect to the Company’s strategy,
plans, expectations, beliefs, including future financial or
operating performance, results of feasibility studies, repayment of
debt or updates regarding mineral reserves and mineral resources,
updates regarding the Company's mines and exploration plans,
belief's in connection with the NCIB, health, safety and
sustainability goals, and project construction and development
plans. Forward-looking statements are characterized by words such
as “plan", “expect”, “budget”, “target”, “project”, “intend”,
“believe”, “anticipate”, “estimate” and other similar words, or
statements that certain events or conditions “may” or “will” occur.
Forward-looking statements are based on the opinions, assumptions
and estimates of management considered reasonable at the date the
statements are made, and are inherently subject to a variety of
risks and uncertainties and other known and unknown factors that
could cause actual events or results to differ materially from
those projected in the forward-looking statements. These factors
include the Company’s expectations in connection with the
production and exploration, development and expansion plans at the
Company's projects discussed herein being met, the impact of
proposed optimizations at the Company's projects, changes in
national and local government legislation, taxation, controls or
regulations and/or change in the administration of laws, policies
and practices, and the impact of general business and economic
conditions, global liquidity and credit availability on the timing
of cash flows and the values of assets and liabilities based on
projected future conditions, fluctuating metal prices (such as
gold, silver, copper and zinc), currency exchange rates (such as
the Canadian Dollar, the Brazilian Real, the Chilean Peso and the
Argentine Peso versus the United States Dollar), the impact of
inflation, possible variations in ore grade or recovery rates,
changes in the Company’s hedging program, changes in accounting
policies, changes in mineral resources and mineral reserves, risks
related to asset dispositions, risks related to metal purchase
agreements, risks related to acquisitions, changes in project
parametres as plans continue to be refined, changes in project
development, construction, production and commissioning time
frames, risks associated with infectious diseases, including
COVID-19, unanticipated costs and expenses, higher prices for fuel,
steel, power, labour and other consumables contributing to higher
costs and general risks of the mining industry, failure of plant,
equipment or processes to operate as anticipated, unexpected
changes in mine life, final pricing for concentrate sales,
unanticipated results of future studies, seasonality and
unanticipated weather changes, costs and timing of the development
of new deposits, success of exploration activities, permitting
timelines, government regulation and the risk of government
expropriation or nationalization of mining operations, risks
related to relying on local advisors and consultants in foreign
jurisdictions, environmental risks, unanticipated reclamation
expenses, risks relating to joint venture operations, title
disputes or claims, limitations on insurance coverage, timing and
possible outcome of pending and outstanding litigation and labour
disputes, risks related to enforcing legal rights in foreign
jurisdictions, as well as those risk factors discussed or referred
to herein and in the Company's Annual Information Form filed with
the securities regulatory authorities in all provinces of Canada
and available at www.sedar.com, and the Company’s Annual Report on
Form 40-F filed with the United States Securities and Exchange
Commission. Although the Company has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be anticipated, estimated or
intended. 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.
The Company undertakes no obligation to update forward-looking
statements if circumstances or management’s estimates, assumptions
or opinions should change, except as required by applicable law.
The reader is cautioned not to place undue reliance on
forward-looking statements. The forward-looking information
contained herein is presented for the purpose of assisting
investors in understanding the Company’s expected financial and
operational performance and results as at and for the periods ended
on the dates presented in the Company’s plans and objectives and
may not be appropriate for other purposes.
CAUTIONARY NOTE TO UNITED STATES INVESTORS
CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED MINERAL
RESOURCESThis news release has been prepared in accordance with the
requirements of the securities laws in effect in Canada, which
differ in certain material respects from the disclosure
requirements promulgated by the Securities and Exchange Commission
(the “SEC”). 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 Canadian mining terms as defined in
accordance with Canadian National Instrument 43-101 Standards of
Disclosure for Mineral Projects and the Canadian Institute of
Mining, Metallurgy and Petroleum (the “CIM”) - CIM Definition
Standards on Mineral Resources and Mineral Reserves, adopted by the
CIM Council, as amended. These definitions differ from the
definitions in the disclosure requirements promulgated by the SEC.
Accordingly, information contained in this news release may not be
comparable to similar information made public by U.S. companies
reporting pursuant to SEC disclosure requirements.
NON-GAAP FINANCIAL PERFORMANCE MEASURES
The Company has included certain non-GAAP
financial performance measures to supplement its Consolidated
Financial Statements, which are presented in accordance with IFRS,
including the following:
- Cash Costs per GEO sold;
- All-in Sustaining Costs per GEO
sold;
- Net Free Cash Flow and Free Cash
Flow Before Dividends and Debt Repayment
- Average Realized Price per ounce of
gold/silver sold; and
- Adjusted Net Earnings
The Company believes that these financial
performance measures, together with measures determined in
accordance with IFRS, provide investors with an improved ability to
evaluate the underlying performance of the Company. Non-GAAP
financial performance measures do not have any standardized meaning
prescribed under IFRS, and therefore they may not be comparable to
similar measures employed by other companies. The data is intended
to provide additional information and should not be considered in
isolation or as a substitute for measures of performance prepared
in accordance with IFRS. Management's determination of the
components of non-GAAP and additional measures are evaluated on a
periodic basis influenced by new items and transactions, a review
of investor uses and new regulations as applicable. Any changes to
the measures are duly noted and retrospectively applied as
applicable.
GEO PRODUCTION AND SALES
Production and sales of silver are treated as a
gold equivalent in determining a combined precious metal production
or sales unit, commonly referred to as gold equivalent ounces
("GEO"). Specifically, guidance GEO produced are calculated by
converting silver production to its gold equivalent using relative
gold/silver metal prices at an assumed ratio and adding the
converted silver production expressed in gold ounces to the ounces
of gold production. Actual GEO production and sales calculations
are based on an average realized gold to silver price ratio for the
relevant period.
CASH COSTS AND ALL-IN SUSTAINING
COSTS
The Company discloses “Cash Costs” because it
understands that certain investors use this information to
determine the Company’s ability to generate earnings and cash flows
for use in investing and other activities. The Company believes
that conventional measures of performance prepared in accordance
with IFRS do not fully illustrate the ability of its operating
mines to generate cash flows. The measures, as determined under
IFRS, are not necessarily indicative of operating profit or cash
flows from operating activities.
The measure of Cash Costs and All-in Sustaining
Costs (AISC), along with revenue from sales, is considered to be a
key indicator of a company’s ability to generate operating earnings
and cash flows from its mining operations. This data is furnished
to provide additional information and is a non-GAAP financial
performance measure. The terms Cash Costs per GEO sold and AISC per
GEO sold are non-GAAP ratios and do not have any standardized
meaning prescribed under IFRS, and therefore they may not be
comparable to similar measures employed by other companies.
Non-GAAP financial performance measures and non-GAAP ratios should
not be considered in isolation as a substitute for measures of
performance prepared in accordance with IFRS and are not
necessarily indicative of operating costs, operating profit or cash
flows presented under IFRS.
Cash Costs include mine site operating costs
such as mining, processing, administration, production taxes and
royalties which are not based on sales or taxable income
calculations, but are exclusive of amortization, reclamation,
capital, development and exploration costs. The Company believes
that such measure provides useful information about its underlying
Cash Costs of operations. Cash Costs are computed on a weighted
average basis as follows:
- Cash Costs per GEO sold - The total
costs used as the numerator of the unitary calculation represent
Cost of Sales excluding DDA, net of treatment and refining charges.
These costs are then divided by GEO sold. Non-attributable costs
will be allocated based on the relative value of revenues for each
metal, which will be determined annually at the beginning of each
year.
AISC figures are calculated in accordance with a
standard developed by the World Gold Council (“WGC”) (a
non-regulatory, market development organization for the gold
industry). Adoption of the standard is voluntary and the cost
measures presented herein may not be comparable to other similarly
titled measures of other companies.
AISC per GEO sold seeks to represent total
sustaining expenditures of producing and selling GEO from current
operations. The total costs used as the numerator of the unitary
calculation represent Cash Costs (defined above) and includes cost
components of mine sustaining capital expenditures including
stripping and underground mine development, corporate and mine-site
general and administrative expense, sustaining mine-site
exploration and evaluation expensed and capitalized and accretion
and amortization of reclamation and remediation. AISC do not
include capital expenditures attributable to projects or mine
expansions, exploration and evaluation costs attributable to growth
projects, income tax payments, borrowing costs and dividend
payments. Consequently, this measure is not representative of all
of the Company's cash expenditures. In addition, the calculation of
AISC does not include depletion, depreciation and amortization
expense as it does not reflect the impact of expenditures incurred
in prior periods.
- AISC per GEO sold - reflect
allocations of the aforementioned cost components on the basis that
is consistent with the nature of each of the cost components to the
GEO production and sales activities.
Reconciliation of Total Cost of Sales to Cash Costs and
AISC
Cash Cost & AISC Reconciliation - Total |
For the three months ended December 31,
2021 |
For the three months ended December 31, 2020 |
(In millions of US Dollars except GEO sold and per GEO sold
amounts) |
Total |
|
TotalGEO |
|
Non-Sustaining |
Total |
|
Total GEO |
|
Non-Sustaining |
Cost of sales excluding DDA |
$ |
180.0 |
|
$ |
180.0 |
|
$ |
— |
$ |
166.8 |
|
$ |
166.8 |
|
$ |
— |
DDA |
|
125.7 |
|
|
125.7 |
|
|
— |
|
112.5 |
|
|
112.5 |
|
|
— |
Total cost of sales |
$ |
305.7 |
|
$ |
305.7 |
|
$ |
— |
$ |
279.3 |
|
$ |
279.3 |
|
$ |
— |
DDA |
|
(125.7 |
) |
|
(125.7 |
) |
|
— |
|
(112.5 |
) |
|
(112.5 |
) |
|
— |
Total cash costs |
$ |
180.0 |
|
$ |
180.0 |
|
$ |
— |
$ |
166.8 |
|
$ |
166.8 |
|
$ |
— |
AISC adjustments: |
|
|
|
|
|
|
General and administrative expenses |
|
20.0 |
|
|
20.0 |
|
|
— |
|
23.4 |
|
|
23.4 |
|
|
— |
Community costs in other operating expenses |
|
2.7 |
|
|
2.7 |
|
|
— |
|
1.9 |
|
|
1.9 |
|
|
— |
Reclamation & remediation - accretion & amortization |
|
8.7 |
|
|
6.8 |
|
|
1.8 |
|
5.8 |
|
|
5.8 |
|
|
— |
Exploration capital expenditures |
|
19.6 |
|
|
8.4 |
|
|
11.1 |
|
21.0 |
|
|
11.8 |
|
|
9.2 |
Exploration and evaluation expenses |
|
6.8 |
|
|
0.7 |
|
|
6.1 |
|
6.0 |
|
|
3.5 |
|
|
2.5 |
Sustaining capital expenditures |
|
44.4 |
|
|
44.4 |
|
|
— |
|
47.8 |
|
|
47.8 |
|
|
— |
Leases (IFRS 16 Adjustment) |
|
6.7 |
|
|
6.7 |
|
|
— |
|
4.8 |
|
|
4.8 |
|
|
— |
Total AISC |
|
$ |
269.7 |
|
|
|
$ |
265.8 |
|
|
GEO
sold(2) |
|
|
280,409 |
|
|
|
|
246,955 |
|
|
Cost of sales
excluding DDA per GEO sold |
|
$ |
642 |
|
|
|
$ |
675 |
|
|
DDA per GEO
sold |
|
$ |
448 |
|
|
|
$ |
455 |
|
|
Total cost of sales
per GEO sold |
|
$ |
1,091 |
|
|
|
$ |
1,131 |
|
|
Cash costs per GEO
sold |
|
$ |
642 |
|
|
|
$ |
675 |
|
|
AISC per GEO sold |
|
$ |
962 |
|
|
|
$ |
1,076 |
|
|
Cash Cost & AISC Reconciliation - Total |
For the year endedDecember 31,
2021 |
For the year ended December 31, 2020 |
(In millions of US Dollars except GEO and per GEO amounts) |
Total |
|
TotalGEO |
|
Non-sustaining |
Total |
|
Total GEO |
|
Non-Sustaining |
Cost of sales excluding DDA |
$ |
695.0 |
|
$ |
695.0 |
|
$ |
— |
$ |
614.1 |
|
$ |
614.1 |
|
$ |
— |
DDA |
|
447.9 |
|
|
447.9 |
|
|
— |
|
395.0 |
|
|
395.0 |
|
|
— |
Total cost of sales |
$ |
1,142.9 |
|
$ |
1,142.9 |
|
$ |
— |
$ |
1,009.1 |
|
$ |
1,009.1 |
|
$ |
— |
DDA |
|
(447.9 |
) |
|
(447.9 |
) |
|
— |
|
(395.0 |
) |
|
(395.0 |
) |
|
— |
Total cash costs |
$ |
695.0 |
|
$ |
695.0 |
|
$ |
— |
$ |
614.1 |
|
$ |
614.1 |
|
$ |
— |
AISC adjustments: |
|
|
|
|
|
|
General and administrative expenses |
|
74.8 |
|
|
74.8 |
|
|
— |
|
85.9 |
|
|
85.9 |
|
|
— |
Community costs in other operating expenses |
|
6.5 |
|
|
6.5 |
|
|
— |
|
6.4 |
|
|
6.4 |
|
|
— |
Reclamation & remediation - accretion & amortization |
|
34.6 |
|
|
27.2 |
|
|
7.4 |
|
20.1 |
|
|
20.1 |
|
|
— |
Exploration capital expenditures |
|
68.1 |
|
|
34.9 |
|
|
33.2 |
|
57.6 |
|
|
41.2 |
|
|
16.4 |
Exploration and evaluation expenses |
|
31.6 |
|
|
2.7 |
|
|
28.9 |
|
15.1 |
|
|
9.6 |
|
|
5.5 |
Sustaining capital expenditures |
|
173.7 |
|
|
173.7 |
|
|
— |
|
149.3 |
|
|
149.3 |
|
|
— |
Leases (IFRS 16 Adjustment) |
|
24.3 |
|
|
24.3 |
|
|
— |
|
20.3 |
|
|
20.3 |
|
|
— |
Total AISC |
|
$ |
1,039.1 |
|
|
|
$ |
946.9 |
|
|
GEO
sold(2) |
|
|
1,009,262 |
|
|
|
|
876,520 |
|
|
Cost of sales
excluding DDA per GEO sold |
|
$ |
689 |
|
|
|
$ |
701 |
|
|
DDA per GEO
sold |
|
$ |
444 |
|
|
|
$ |
451 |
|
|
Total cost of sales
per GEO sold |
|
$ |
1,132 |
|
|
|
$ |
1,151 |
|
|
Cash costs per GEO
sold |
|
$ |
689 |
|
|
|
$ |
701 |
|
|
AISC per GEO sold |
|
$ |
1,030 |
|
|
|
$ |
1,080 |
|
|
Cash
Cost & AISC Reconciliation - Operating Segments |
For the three months ended December 31, 2021 |
(In millions of US Dollars except GEO sold and per GEO sold
amounts) |
Total |
|
MalarticGEO |
|
JacobinaGEO |
|
Cerro MoroGEO |
|
El PeñónGEO |
|
Minera FloridaGEO |
|
Corporate & Non-Sustaining |
|
Cost of sales excluding DDA |
$ |
180.0 |
|
$ |
61.8 |
|
$ |
22.0 |
|
$ |
40.7 |
|
$ |
37.2 |
|
$ |
18.3 |
|
$ |
— |
|
DDA |
|
125.7 |
|
|
45.4 |
|
|
15.2 |
|
|
27.9 |
|
|
22.2 |
|
|
12.5 |
|
|
2.5 |
|
Total cost of sales |
$ |
305.7 |
|
$ |
107.2 |
|
$ |
37.2 |
|
$ |
68.6 |
|
$ |
59.4 |
|
$ |
30.8 |
|
$ |
2.5 |
|
DDA |
|
(125.7 |
) |
|
(45.4 |
) |
|
(15.2 |
) |
|
(27.9 |
) |
|
(22.2 |
) |
|
(12.5 |
) |
|
(2.5 |
) |
Total cash costs |
$ |
180.0 |
|
$ |
61.8 |
|
$ |
22.0 |
|
$ |
40.7 |
|
$ |
37.2 |
|
$ |
18.3 |
|
$ |
— |
|
AISC adjustments: |
|
|
|
|
|
|
|
General and administrative expenses |
|
20.0 |
|
|
1.3 |
|
|
0.2 |
|
|
0.3 |
|
|
0.3 |
|
|
0.4 |
|
|
17.5 |
|
Community costs in other operating expenses |
|
2.7 |
|
|
0.9 |
|
|
0.3 |
|
|
1.3 |
|
|
— |
|
|
— |
|
|
0.2 |
|
Reclamation & remediation - accretion & amortization |
|
8.7 |
|
|
3.9 |
|
|
0.3 |
|
|
1.2 |
|
|
0.4 |
|
|
0.8 |
|
|
2.1 |
|
Exploration capital expenditures |
|
19.6 |
|
|
— |
|
|
1.8 |
|
|
1.3 |
|
|
2.3 |
|
|
3.1 |
|
|
11.1 |
|
Exploration and evaluation expenses |
|
6.8 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
6.8 |
|
Sustaining capital expenditures |
|
44.4 |
|
|
17.3 |
|
|
4.2 |
|
|
12.4 |
|
|
7.1 |
|
|
2.9 |
|
|
0.5 |
|
Leases (IFRS 16 Adjustment) |
|
6.7 |
|
|
0.2 |
|
|
2.4 |
|
|
1.4 |
|
|
1.3 |
|
|
0.9 |
|
|
0.5 |
|
Total AISC |
|
$ |
85.4 |
|
$ |
31.2 |
|
$ |
58.6 |
|
$ |
48.6 |
|
$ |
26.4 |
|
|
GEO sold(2) |
|
|
91,589 |
|
|
48,732 |
|
|
56,087 |
|
|
63,943 |
|
|
20,058 |
|
|
Cost of sales excluding DDA
per GEO sold |
|
$ |
676 |
|
$ |
452 |
|
$ |
726 |
|
$ |
582 |
|
$ |
911 |
|
|
DDA per GEO sold |
|
$ |
496 |
|
$ |
312 |
|
$ |
498 |
|
$ |
347 |
|
$ |
624 |
|
|
Total cost of sales per GEO
sold |
|
$ |
1,171 |
|
$ |
763 |
|
$ |
1,224 |
|
$ |
929 |
|
$ |
1,535 |
|
|
Cash costs per GEO sold |
|
$ |
676 |
|
$ |
452 |
|
$ |
726 |
|
$ |
582 |
|
$ |
911 |
|
|
AISC
per GEO sold |
|
$ |
931 |
|
$ |
643 |
|
$ |
1,044 |
|
$ |
761 |
|
$ |
1,313 |
|
|
Cash
Cost & AISC Reconciliation - Operating Segments |
For the three months ended December 31, 2020 |
(In millions of US Dollars except GEO sold and per GEO sold
amounts) |
Total |
|
MalarticGEO |
|
JacobinaGEO |
|
Cerro MoroGEO |
|
El PeñónGEO |
|
Minera FloridaGEO |
|
Corporate & Non-Sustaining |
|
Cost of sales excluding DDA |
$ |
166.8 |
|
$ |
53.4 |
|
$ |
25.2 |
|
$ |
33.8 |
|
$ |
36.0 |
|
$ |
18.2 |
|
$ |
— |
|
DDA |
|
112.5 |
|
|
41.5 |
|
|
13.6 |
|
|
25.4 |
|
|
16.9 |
|
|
12.5 |
|
|
2.6 |
|
Total cost of sales |
$ |
279.3 |
|
$ |
94.9 |
|
$ |
38.8 |
|
$ |
59.2 |
|
$ |
52.9 |
|
$ |
30.7 |
|
$ |
2.6 |
|
DDA |
|
(112.5 |
) |
|
(41.5 |
) |
|
(13.6 |
) |
|
(25.4 |
) |
|
(16.9 |
) |
|
(12.5 |
) |
|
(2.6 |
) |
Total cash costs |
$ |
166.8 |
|
$ |
53.4 |
|
$ |
25.2 |
|
$ |
33.8 |
|
$ |
36.0 |
|
$ |
18.2 |
|
$ |
— |
|
AISC adjustments: |
|
|
|
|
|
|
|
General and administrative expenses |
|
23.4 |
|
|
1.0 |
|
|
0.2 |
|
|
0.3 |
|
|
0.3 |
|
|
0.2 |
|
|
21.4 |
|
Community costs in other operating expenses |
|
1.9 |
|
|
0.1 |
|
|
0.1 |
|
|
1.6 |
|
|
— |
|
|
— |
|
|
0.1 |
|
Reclamation & remediation - accretion & amortization |
|
5.8 |
|
|
2.4 |
|
|
0.5 |
|
|
0.7 |
|
|
0.6 |
|
|
1.0 |
|
|
0.6 |
|
Exploration capital expenditures |
|
21.0 |
|
|
— |
|
|
2.0 |
|
|
3.5 |
|
|
4.7 |
|
|
1.8 |
|
|
9.0 |
|
Exploration and evaluation expenses |
|
6.0 |
|
|
0.1 |
|
|
0.1 |
|
|
— |
|
|
— |
|
|
— |
|
|
6.0 |
|
Sustaining capital expenditures |
|
47.8 |
|
|
18.6 |
|
|
5.4 |
|
|
9.0 |
|
|
9.9 |
|
|
4.4 |
|
|
0.5 |
|
Leases (IFRS 16 Adjustment) |
|
4.8 |
|
|
0.2 |
|
|
1.0 |
|
|
1.3 |
|
|
1.5 |
|
|
0.4 |
|
|
0.4 |
|
Total AISC |
|
$ |
75.8 |
|
$ |
34.5 |
|
$ |
50.2 |
|
$ |
53.0 |
|
$ |
26.0 |
|
|
GEO sold(2) |
|
|
84,348 |
|
|
42,789 |
|
|
44,101 |
|
|
51,738 |
|
|
23,979 |
|
|
Cost of sales excluding DDA
per GEO sold |
|
$ |
634 |
|
$ |
590 |
|
$ |
768 |
|
$ |
696 |
|
$ |
760 |
|
|
DDA per GEO sold |
|
$ |
493 |
|
$ |
317 |
|
$ |
576 |
|
$ |
327 |
|
$ |
519 |
|
|
Total cost of sales per GEO
sold |
|
$ |
1,126 |
|
$ |
907 |
|
$ |
1,343 |
|
$ |
1,023 |
|
$ |
1,279 |
|
|
Cash costs per GEO sold |
|
$ |
634 |
|
$ |
590 |
|
$ |
768 |
|
$ |
696 |
|
$ |
760 |
|
|
AISC
per GEO sold |
|
$ |
898 |
|
$ |
807 |
|
$ |
1,139 |
|
$ |
1,025 |
|
$ |
1,087 |
|
|
Cash
Cost & AISC Reconciliation - Operating Segments |
For the year ended December 31, 2021 |
(In millions of US Dollars except GEO and per GEO amounts) |
Total |
|
MalarticGEO |
|
JacobinaGEO |
|
Cerro MoroGEO |
|
El PeñónGEO |
|
Minera FloridaGEO |
|
Corporate & Non-Sustaining |
|
Cost of sales excluding DDA |
$ |
695.0 |
|
$ |
231.3 |
|
$ |
105.5 |
|
$ |
130.5 |
|
$ |
150.3 |
|
$ |
77.4 |
|
$ |
— |
|
DDA |
|
447.9 |
|
|
174.7 |
|
|
55.4 |
|
|
74.6 |
|
|
85.0 |
|
|
48.5 |
|
|
9.7 |
|
Total cost of sales |
$ |
1,142.9 |
|
$ |
406.0 |
|
$ |
160.9 |
|
$ |
205.1 |
|
$ |
235.3 |
|
$ |
125.9 |
|
$ |
9.7 |
|
DDA |
|
(447.9 |
) |
|
(174.7 |
) |
|
(55.4 |
) |
|
(74.6 |
) |
|
(85.0 |
) |
|
(48.5 |
) |
|
(9.7 |
) |
Total cash costs |
$ |
695.0 |
|
$ |
231.3 |
|
$ |
105.5 |
|
$ |
130.5 |
|
$ |
150.3 |
|
$ |
77.4 |
|
$ |
— |
|
AISC adjustments: |
|
|
|
|
|
|
|
General and administrative expenses |
|
74.8 |
|
|
4.0 |
|
|
0.7 |
|
|
0.4 |
|
|
0.5 |
|
|
0.7 |
|
|
68.5 |
|
Community costs in other operating expenses |
|
6.5 |
|
|
1.2 |
|
|
0.9 |
|
|
4.0 |
|
|
— |
|
|
— |
|
|
0.4 |
|
Reclamation & remediation - accretion & amortization |
|
34.6 |
|
|
15.7 |
|
|
1.5 |
|
|
3.2 |
|
|
2.0 |
|
|
4.4 |
|
|
7.8 |
|
Exploration capital expenditures |
|
68.1 |
|
|
— |
|
|
7.2 |
|
|
5.6 |
|
|
15.6 |
|
|
6.5 |
|
|
33.2 |
|
Exploration and evaluation expenses |
|
31.6 |
|
|
0.2 |
|
|
0.2 |
|
|
— |
|
|
— |
|
|
— |
|
|
31.2 |
|
Sustaining capital expenditures |
|
173.7 |
|
|
69.2 |
|
|
14.0 |
|
|
39.8 |
|
|
34.6 |
|
|
15.2 |
|
|
0.9 |
|
Leases (IFRS 16 Adjustment) |
|
24.3 |
|
|
0.7 |
|
|
7.6 |
|
|
5.4 |
|
|
5.1 |
|
|
3.3 |
|
|
2.2 |
|
Total AISC |
|
$ |
322.3 |
|
$ |
137.6 |
|
$ |
188.9 |
|
$ |
208.1 |
|
$ |
107.5 |
|
|
GEO sold(2) |
|
|
357,667 |
|
|
186,534 |
|
|
153,882 |
|
|
223,375 |
|
|
87,804 |
|
|
Cost of sales excluding DDA
per GEO sold |
|
$ |
647 |
|
$ |
566 |
|
$ |
848 |
|
$ |
673 |
|
$ |
881 |
|
|
DDA per GEO sold |
|
$ |
488 |
|
$ |
297 |
|
$ |
485 |
|
$ |
381 |
|
$ |
553 |
|
|
Total cost of sales per GEO
sold |
|
$ |
1,135 |
|
$ |
863 |
|
$ |
1,332 |
|
$ |
1,054 |
|
$ |
1,434 |
|
|
Cash costs per GEO sold |
|
$ |
647 |
|
$ |
566 |
|
$ |
848 |
|
$ |
673 |
|
$ |
881 |
|
|
AISC
per GEO sold |
|
$ |
901 |
|
$ |
738 |
|
$ |
1,228 |
|
$ |
932 |
|
$ |
1,224 |
|
|
Cash
Cost & AISC Reconciliation - Operating Segments |
For the year ended December 31, 2020 |
(In millions of US Dollars except GEO and per GEO amounts) |
Total |
|
MalarticGEO |
|
JacobinaGEO |
|
Cerro MoroGEO |
|
El PeñónGEO |
|
Minera FloridaGEO |
|
Corporate & Non-Sustaining |
|
Cost of sales excluding DDA |
$ |
614.1 |
|
$ |
185.4 |
|
$ |
95.5 |
|
$ |
115.8 |
|
$ |
141.8 |
|
$ |
75.6 |
|
$ |
— |
|
DDA |
|
395.0 |
|
|
133.4 |
|
|
52.6 |
|
|
86.1 |
|
|
69.6 |
|
|
44.2 |
|
|
9.1 |
|
Total cost of sales |
$ |
1,009.1 |
|
$ |
318.8 |
|
$ |
148.1 |
|
$ |
201.8 |
|
$ |
211.4 |
|
$ |
119.8 |
|
$ |
9.1 |
|
DDA |
|
(395.0 |
) |
|
(133.4 |
) |
|
(52.6 |
) |
|
(86.1 |
) |
|
(69.6 |
) |
|
(44.2 |
) |
|
(9.1 |
) |
Total cash costs |
$ |
614.1 |
|
$ |
185.4 |
|
$ |
95.5 |
|
$ |
115.8 |
|
$ |
141.8 |
|
$ |
75.6 |
|
$ |
— |
|
AISC adjustments: |
|
|
|
|
|
|
|
General and administrative expenses |
|
85.9 |
|
|
2.5 |
|
|
0.7 |
|
|
0.5 |
|
|
0.5 |
|
|
0.4 |
|
|
81.3 |
|
Community costs in other operating expenses |
|
6.4 |
|
|
0.3 |
|
|
0.7 |
|
|
4.6 |
|
|
— |
|
|
— |
|
|
0.8 |
|
Reclamation & remediation - accretion & amortization |
|
20.1 |
|
|
8.2 |
|
|
2.2 |
|
|
2.8 |
|
|
2.2 |
|
|
3.6 |
|
|
1.1 |
|
Exploration capital expenditures |
|
57.6 |
|
|
— |
|
|
6.0 |
|
|
12.6 |
|
|
15.9 |
|
|
7.0 |
|
|
16.1 |
|
Exploration and evaluation expenses |
|
15.1 |
|
|
0.1 |
|
|
0.1 |
|
|
— |
|
|
— |
|
|
— |
|
|
14.9 |
|
Sustaining capital expenditures |
|
149.3 |
|
|
52.5 |
|
|
21.6 |
|
|
29.5 |
|
|
31.4 |
|
|
12.6 |
|
|
1.7 |
|
Leases (IFRS 16 Adjustment) |
|
20.3 |
|
|
0.7 |
|
|
4.1 |
|
|
5.0 |
|
|
7.0 |
|
|
1.8 |
|
|
1.7 |
|
Total AISC |
|
$ |
249.7 |
|
$ |
130.9 |
|
$ |
170.8 |
|
$ |
198.8 |
|
$ |
101.0 |
|
|
GEO sold(2) |
|
|
264,198 |
|
|
175,561 |
|
|
133,358 |
|
|
215,667 |
|
|
87,735 |
|
|
Cost of sales excluding DDA
per GEO sold |
|
$ |
702 |
|
$ |
544 |
|
$ |
868 |
|
$ |
657 |
|
$ |
862 |
|
|
DDA per GEO sold |
|
$ |
505 |
|
$ |
300 |
|
$ |
645 |
|
$ |
323 |
|
$ |
503 |
|
|
Total cost of sales per GEO
sold |
|
$ |
1,207 |
|
$ |
844 |
|
$ |
1,513 |
|
$ |
980 |
|
$ |
1,366 |
|
|
Cash costs per GEO sold |
|
$ |
702 |
|
$ |
544 |
|
$ |
868 |
|
$ |
657 |
|
$ |
862 |
|
|
AISC
per GEO sold |
|
$ |
945 |
|
$ |
746 |
|
$ |
1,280 |
|
$ |
922 |
|
$ |
1,152 |
|
|
NET FREE CASH FLOW AND FREE CASH FLOW BEFORE
DIVIDENDS AND DEBT REPAYMENTS
The Company uses the financial measures "Net
Free Cash Flow" and "Free Cash Flow Before Dividends and Debt
Repayment", which are non-GAAP financial performance measures, to
supplement information in its Consolidated Financial Statements.
Net Free Cash Flow and Free Cash Flow do not have any standardized
meaning prescribed under IFRS, and therefore may not be comparable
to similar measures employed by other companies. The Company
believes that in addition to conventional measures prepared in
accordance with IFRS, the Company and certain investors and
analysts use this information to evaluate the Company’s performance
with respect to its operating cash flow capacity to meet
non-discretionary outflows of cash or to meet dividends and debt
repayments. The presentation of Net Free Cash Flow and Free Cash
Flow are not meant to be substitutes for the cash flow information
presented in accordance with IFRS, but rather should be evaluated
in conjunction with such IFRS measures. Net Free Cash Flow is
calculated as cash flows from operating activities adjusted for
advance payments received pursuant to metal purchase agreements,
non-discretionary expenditures from sustaining capital expenditures
and interest paid related to the current period. Free Cash Flow
further deducts remaining capital expenditures and payments for
lease obligations. Reconciliations of Net Free Cash Flow and Free
Cash Flow are provided below.
Reconciliation of Cash Flows from
Operating Activities to non-GAAP Measures
|
Three months ended December 31 |
(In millions of United States Dollars) |
|
2021 |
|
|
2020 |
|
Cash flows from operating activities |
$ |
238.2 |
|
$ |
181.5 |
|
Adjustments to operating cash
flows: |
|
|
Amortization of deferred revenue |
|
3.5 |
|
|
3.8 |
|
Temporary suspension, standby and other incremental COVID-19
costs |
|
8.7 |
|
|
9.2 |
|
Non-discretionary items
related to the current period |
|
|
Sustaining capital expenditures |
|
(44.4 |
) |
|
(47.8 |
) |
Interest paid |
|
(8.3 |
) |
|
(21.3 |
) |
Payment of lease liabilities |
|
(5.8 |
) |
|
(4.2 |
) |
Cash used in other financing activities |
|
(3.5 |
) |
|
(2.3 |
) |
Net free cash flow |
$ |
188.4 |
|
$ |
118.9 |
|
Discretionary and other items
impacting cash flow available for dividends and debt
repayments |
|
|
Expansionary and exploration capital expenditures |
|
(73.6 |
) |
|
(47.4 |
) |
Cash flows from (used in) other investing activities |
|
5.1 |
|
|
(10.0 |
) |
Effect of foreign exchange of non-USD denominated cash |
|
(0.3 |
) |
|
0.3 |
|
Free cash flow before dividends and debt
repayments |
$ |
119.6 |
|
$ |
61.8 |
|
AVERAGE REALIZED METAL PRICES
The Company uses the financial measures "average
realized gold price" and "average realized silver price", which are
non-GAAP financial performance measures, to supplement in its
Consolidated Financial Statements. Average realized price does not
have any standardized meaning prescribed under IFRS, and therefore
may not be comparable to similar measures employed by other
companies. The Company believes that in addition to conventional
measures prepared in accordance with IFRS, the Company and certain
investors and analysts use this information to evaluate the
Company’s performance vis-à-vis average market prices of metals for
the period. The presentation of average realized metal prices is
not meant to be a substitute for the revenue information presented
in accordance with IFRS, but rather should be evaluated in
conjunction with such IFRS measure.
Average realized metal price represents the sale
price of the underlying metal before deducting treatment and
refining charges, and other quotational and pricing adjustments.
Average realized prices are calculated as the revenue related to
each of the metals sold, i.e. gold and silver, divided by the
quantity of the respective units of metals sold, i.e. gold ounce
and silver ounce. Reconciliations of average realized metal prices
to revenue are provided below.
Reconciliation of average realized metal prices
to revenue
For the
three months ended December 31, |
2021 |
|
2020 |
|
Quantitysold |
|
Revenue per ounce/pound |
Revenue(In millions of US Dollars) |
|
Quantitysold |
|
Revenueper ounce/pound |
Revenue(In millions of US Dollars) |
Gold |
242,486 |
oz |
$ |
1,796 |
$ |
435.5 |
|
213,439 |
oz |
$ |
1,875 |
$ |
400.2 |
Silver |
2,937,805 |
oz |
$ |
23.24 |
|
68.3 |
|
2,563,166 |
oz |
$ |
24.02 |
|
61.6 |
Revenue |
|
|
|
$ |
503.8 |
|
|
|
|
$ |
461.8 |
For the
three months ended December 31, |
2021 |
|
2020 |
|
Quantitysold |
|
Average RealizedPrice |
Revenue(In millions of US Dollars) |
|
Quantitysold |
|
Average RealizedPrice |
Revenue(In millions of US Dollars) |
Gold |
242,486 |
oz |
$ |
1,796 |
$ |
435.5 |
|
213,439 |
oz |
$ |
1,875 |
$ |
400.2 |
|
|
|
|
|
|
|
|
|
|
Silver |
2,709,252 |
oz |
$ |
23.35 |
|
63.3 |
|
2,294,546 |
oz |
$ |
24.32 |
|
55.8 |
Silver subject to metal sales
agreement* |
228,553 |
oz |
$ |
21.94 |
|
5.0 |
|
268,620 |
oz |
$ |
21.44 |
|
5.8 |
|
2,937,805 |
oz |
$ |
23.24 |
|
|
2,563,166 |
oz |
$ |
24.02 |
|
Gross
revenue |
|
|
|
$ |
503.8 |
|
|
|
|
$ |
461.8 |
(Deduct) add: |
|
|
|
|
|
|
|
|
|
Deferred revenue adjustment** |
|
|
|
|
— |
|
|
|
|
|
— |
Other adjustments |
|
|
|
|
— |
|
|
|
|
|
— |
Revenue |
|
|
|
$ |
503.8 |
|
|
|
|
$ |
461.8 |
For the
year ended December 31, |
2021 |
|
2020 |
|
Quantitysold |
|
Revenueper ounce/pound |
Revenue(In millions of US Dollars) |
|
Quantitysold |
|
Revenue per ounce/pound |
Revenue(In millions of US Dollars) |
Gold |
885,293 |
oz |
$ |
1,799 |
$ |
1,592.4 |
|
754,970 |
oz |
$ |
1,777 |
$ |
1,341.8 |
Silver |
8,976,269 |
oz |
$ |
24.85 |
|
223.0 |
|
10,382,086 |
oz |
$ |
21.11 |
|
219.2 |
Revenue |
|
|
|
$ |
1,815.4 |
|
|
|
|
$ |
1,561.0 |
For the
year ended December 31, |
2021 |
|
2020 |
|
Quantitysold |
|
Average RealizedPrice |
Revenue(In millions of US Dollars) |
|
Quantitysold |
|
Average RealizedPrice |
Revenue(In millions of US Dollars) |
Gold |
885,293 |
oz |
$ |
1,799 |
$ |
1,592.4 |
|
|
754,970 |
oz |
$ |
1,777 |
$ |
1341.8 |
|
|
|
|
|
|
|
|
|
|
Silver |
7,951,386 |
oz |
$ |
24.85 |
|
197.6 |
|
|
9,380,951 |
oz |
$ |
21.04 |
|
197.4 |
Silver subject to metal sales agreement* |
1,024,883 |
oz |
$ |
22.59 |
|
23.2 |
|
|
1,001,135 |
oz |
$ |
19.91 |
|
19.9 |
|
8,976,269 |
oz |
$ |
24.59 |
|
|
10,382,086 |
oz |
$ |
20.93 |
|
Gross
revenue |
|
|
|
$ |
1,813.2 |
|
|
|
|
|
$ |
1,559.1 |
(Deduct) add: |
|
|
|
|
|
|
|
|
|
Deferred revenue adjustment** |
|
|
|
|
2.4 |
|
|
|
|
|
|
1.9 |
Other adjustments |
|
|
|
|
(0.2 |
) |
|
|
|
|
|
— |
Revenue |
|
|
|
$ |
1,815.4 |
|
|
|
|
|
$ |
1,561.0 |
ADJUSTED NET EARNINGS OR LOSS AND ADJUSTED NET
EARNINGS OR LOSS PER SHARE
The Company uses the financial measures
“Adjusted Net Earnings or Loss” and the non-GAAP ratio “Adjusted
Net Earnings or Loss per share” to supplement information in its
Consolidated Annual Financial Statements. The Company believes that
in addition to conventional measures prepared in accordance with
IFRS, the Company and certain investors and analysts use this
information to evaluate the Company’s performance. The presentation
of adjusted measures and ratios are not meant to be a substitute
for Net Earnings or Loss or Net Earnings or Loss per share
presented in accordance with IFRS, but rather should be evaluated
in conjunction with such IFRS measures. Adjusted Net Earnings or
Loss and Adjusted Net Earnings or Loss per share are calculated as
net earnings excluding non-recurring items, items not related to or
having a disproportionate effect on results for a particular
periods and/or not directly related to the core mining business
such as (a) share-based payments and other compensation, (b)
unrealized foreign exchange (gains) losses related to revaluation
of deferred income tax asset and liability on non-monetary items,
(c) unrealized foreign exchange (gains) losses related to other
items, (d) unrealized (gains) losses on derivatives, (e) impairment
losses and reversals on mineral interests and other assets, (f)
deferred income tax expense (recovery) on the translation of
foreign currency inter-corporate debt, (g) mark-to-market (gains)
losses on other assets, (h) one-time tax adjustments to historical
deferred income tax balances relating to changes in enacted tax
rates, (i) reorganization costs, (j) non-recurring provisions, (k)
(gains) losses on sale of assets, (l) any other non-recurring
adjustments and the tax impact of any of these adjustments
calculated at the statutory effective rate for the same
jurisdiction as the adjustment. Non-recurring adjustments from
unusual events or circumstances are reviewed from time to time
based on materiality and the nature of the event or circumstance.
Earnings adjustments for the comparative period reflect both
continuing and discontinued operations.
The terms “Adjusted Net Earnings or Loss” and
“Adjusted Net Earnings or Loss per share” do not have a
standardized meaning prescribed by IFRS, and therefore the
Company’s definitions are unlikely to be comparable to similar
measures presented by other companies. Management uses these
measures for internal valuation of the core mining performance for
the period and to assist with planning and forecasting of future
operations. Management believes that the presentation of Adjusted
Net Earnings or Loss and Adjusted Net Earnings or Loss per share
provide useful information to investors because they exclude
non-recurring items, items not related to or not indicative of
current or future periods' results and/or not directly related to
the core mining business and are a better indication of the
Company’s profitability from operations as evaluated by internal
management and the board of directors. The items excluded from the
computation of Adjusted Net Earnings or Loss and Adjusted Net
Earnings or Loss per share, which are otherwise included in the
determination of Net Earnings or Loss and Net Earnings or Loss per
share prepared in accordance with IFRS, are items that the Company
does not consider to be meaningful in evaluating the Company’s past
financial performance or the future prospects and may hinder a
comparison of its period-to-period profitability. A reconciliation
of Net Earnings to Adjusted Net Earnings is included earlier in
this news release.
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