Atico Reports Consolidated Financial Results for 2018
Atico Mining Corporation (the “Company” or “Atico”) (TSX.V: ATY |
OTC: ATCMF) today announced its financial results for the year
ended December 31, 2018, posting income from mining operations of
$12.8 million and a net income of $3.4 million. Production for the
year at Atico’s El Roble mine totaled 21.9 million pounds (“lb”) of
copper and 11,344 ounces (“oz”) of gold in concentrate at as cash
cost(1) of $1.49 per payable pound of copper(2).
Fernando E. Ganoza, CEO and Director, commented,
"We are pleased to report very strong financial results for 2018.
The Company has improved in most financial metrics and yielded good
results, particularly; repayment of the long-term debt facility in
full and continued growth of our working capital position. The
operation delivered and exceeded the upper-limit of our guidance
while also reducing operating costs in the second half of the year.
Mr. Ganoza continued, "In 2019 our primary goal will be to continue
aggressively advancing our regional and underground exploration
drill programs looking for new massive sulphides. In parallel, the
search for a second asset remains to be a high priority as we
continue to strive towards our goal of becoming a leading mid-tier
producer."
2018 Consolidated Financial
Highlights
- Net income for the year ended December 31, 2018 amounted to
$3.4 million, compared with $4.0 million for last year. Net income
for the year was impacted by the decreased quantity of concentrate
shipped and provisionally invoiced as compared to 2017, partially
offset by higher average realized copper price.
- Sales for the year decreased 4% to $54.6 million when compared
with 2017. The final 2018 shipment was delayed to the subsequent
month for reasons beyond the control of the Company, which has
decreased the quantity of concentrate shipped and provisionally
invoiced. The effect of the delayed shipment was partially offset
by a higher realized copper price when compared to 2017. Copper
(“Cu”) and gold (“Au”) accounted for 94.1% and 5.9% of the total
amount provisionally invoiced during the year. The average realized
price per metal on provisional invoicing was $3.06 (2017 - $2.94)
per pound of copper and $1,257.75 (2017 - $1,301.69) per ounce of
gold.
- Working capital was $7.2 million (2017 - $4.6 million), while
the Company repaid principal of $2.7 million (2017 - $3.1 million)
on its long-term loans payable with no outstanding balance at the
reporting date (2017 - $2.7 million).
- Cash costs(1) were $124.38 per tonne of processed ore and $1.49
per pound of payable copper produced(2), increases of 5% and 3%
over the previous year, respectively.
- Income from operations was $8.6 million (2017 - $7.6 million)
while cash flow from operations, before changes in working capital,
was $13.9 million (2017 - $18.2 million). Cash used for capital
expenditures amounted to $11.7 million (2017 - $10.2
million).
- At the end of the year, 11,036 (2017 - 7,366) wet metric tonnes
(“WMT”) of non-invoiced concentrate remained at the Company’s
warehouses.
- All-in sustaining cash cost per payable pound of copper
produced(1)(2) for the year was $1.94 (2017 - $2.05).
2018 Consolidated Operating Highlights
and Review
- Ore processed increased 12% year-on-year;
- Copper head grade decreased 4% year-on-year;
- Gold head grade decreased 2% year-on-year;
- Concentrate production increased 5% year-on-year;
- Copper metal production increased 6% year-on-year;
and
- Gold metal production increased 4% year-on-year.
In 2018, the Company produced 21.9 million
pounds of copper, 11,344 ounces of gold, and 42,569 ounces of
silver. When compared to the previous year, production increased by
6% for copper and 4% for gold. The increase in copper production is
mainly explained by a 12% increase in processed material, partially
offset by a 4% decrease in head grade. In the case of gold, the
increase in processed material was partially offset by a 2%
decrease in head grade and a 4% decrease in recovery.
Cash costs(1) were $124.38 per tonne of
processed ore and $1.49 per pound of payable copper produced(2),
which was an increase of 5% and 3% over 2017, respectively. The
increase in the cash cost per pound of payable copper net of by
products is mainly explained by the higher cost per processed
tonne, partially offset by a higher gold content value and a
decrease in treatment and refining charges. The increase in direct
mining cost of 15% for the same period, partially offset by a 5%
reduction in the milling, processing and indirect cost, explain the
increase in the cost per processed tonne.
Efforts to improve the cash cost per processed
tonne in 2018 yielded results in the third and fourth quarters with
a decrease of 9.7% and 9.6% respectively, relative to the previous
quarters. The Company expects the cost improvement measures will
continue yielding results in 2019.
The all-in sustaining cash cost net of
by-products credits(1)(2) was $1.94 per pound of payable copper
produced, which represents a 5% decrease over 2017.
Fourth Quarter Financial
Highlights
During the quarter, the
Company generated sales of $12.0 million, where copper accounted
for 92.8% and gold for 7.2%. The average realized price per metal
on provisional invoicing was $2.82 per pound of copper and
$1,223.03 per ounce of gold. Cash flow from operations, before
changes in working capital, for the quarter was $1.91 million.
Cash costs(1) for the quarter were $111.69 per
tonne of processed ore and $1.37 per pound of payable copper
produced(2), decreases of 16% and 18% over Q4-2017, respectively.
The decrease in the cash cost per pound of payable copper net of by
products is mainly explained by a lower cost per processed tonne
contributed by reductions across all categories: direct mining cost
by 5%, milling and processing cost by 19%, and indirect and
distribution costs by 29% each. The all-in sustaining cash cost per
payable pound of copper produced(1)(2) was $1.76, which represents
a 22% decrease over Q4-2017.
2018 Consolidated Operational
Details
|
Q1 Total |
Q2 Total |
Q3 Total |
Q4 Total |
2018 Total |
Production (Contained in Concentrates)(3) |
|
|
|
|
|
Copper (000s pounds) |
5,476 |
5,220 |
5,358 |
5,811 |
21,865 |
Gold (ounces) |
2,825 |
2,596 |
3,010 |
2,913 |
11,344 |
Silver (ounces) |
10,606 |
10,014 |
10,250 |
11,699 |
42,569 |
Mine |
|
|
|
|
|
Tonnes of ore mined |
67,022 |
67,255 |
70,652 |
73,575 |
278,504 |
Mill |
|
|
|
|
|
Tonnes processed |
69,499 |
67,308 |
71,760 |
76,985 |
285,551 |
Tonnes processed per day |
812 |
792 |
837 |
867 |
827 |
Copper grade (%) |
3.80 |
3.76 |
3.63 |
3.66 |
3.71 |
Gold grade (g/t) |
2.03 |
2.02 |
2.17 |
2.00 |
2.05 |
Silver grade (g/t) |
8.71 |
8.54 |
11.28 |
10.14 |
9.70 |
Recoveries |
|
|
|
|
|
Copper (%) |
94.0 |
93.7 |
93.4 |
93.5 |
93.6 |
Gold (%) |
62.8 |
59.8 |
60.3 |
59.0 |
60.3 |
Silver (%) |
48.6 |
56.1 |
40.3 |
46.6 |
47.7 |
Concentrates |
|
|
|
|
|
Copper Concentrates (dmt) |
11,474 |
10,717 |
10,877 |
11,827 |
44,895 |
Copper (%) |
21.7 |
22.1 |
22.3 |
22.3 |
22.1 |
Gold (g/t) |
7.7 |
7.5 |
8.6 |
7.6 |
7.8 |
Silver (g/t) |
28.8 |
29.1 |
29.3 |
30.7 |
29.5 |
|
|
|
|
|
|
Payable copper produced (000s lb) |
5,202 |
4,960 |
5,105 |
5,521 |
20,788 |
Cash cost per pound of payable copper(1)(2) ($/lb) |
1.44 |
1.67 |
1.49 |
1.37 |
1.49 |
The financial statements and MD&A are
available on SEDAR and have also been posted on the company's
website at http://www.aticomining.com/s/FinancialStatements.asp
Annual General Meeting
Atico Mining cordially invites all shareholders
to its Annual General and Special Meeting of Shareholders, at 10:00
am, Tuesday, June 11, 2019, at Suite 501 - 543 Granville Street
Vancouver, British Columbia.
El Roble Mine
The El Roble mine is a high grade, underground
copper and gold mine with nominal processing plant capacity of 850
tonnes per day, located in the Department of Choco in Colombia. Its
commercial product is a copper-gold concentrate.
Since obtaining control of the mine on November
22, 2013, Atico has upgraded the operation from a historical
nominal capacity of 400 tonnes per day.
El Roble has Proven and Probable reserves of
1.47 million tonnes grading 3.40% copper and 1.88 g/t gold, at a
cut-off grade of 1.93% copper equivalent as of June 30, 2018.
Mineralization is open at depth and along strike and the Company
plans to further test the limits of the deposit.
On the larger land package, the Company has
identified a prospective stratigraphic contact between volcanic
rocks and black and grey pelagic sediments and cherts that has been
traced by Atico geologists for ten kilometers. This contact has
been determined to be an important control on volcanogenic massive
sulfide (“VMS”) mineralization on which Atico has identified
numerous target areas prospective for VMS type mineralization
occurrence, which is the focus of the current surface drill program
at El Roble.
Qualified Person
Mr. Thomas Kelly (SME Registered Member
1696580), advisor to the Company and a qualified person under
National Instrument 43-101 standards, is responsible for ensuring
that the technical information contained in this news release is an
accurate summary of the original reports and data provided to or
developed by Atico.
About Atico Mining Corporation
Atico is a growth-oriented Company, focused on
exploring, developing and mining copper and gold projects in Latin
America. The Company operates the El Roble mine and is pursuing
additional acquisition opportunities. For more information, please
visit www.aticomining.com.
ON BEHALF OF THE BOARD
Fernando E. GanozaCEOAtico Mining
Corporation
Trading symbols: TSX.V: ATY | OTC: ATCMF
Investor RelationsIgor DutinaTel:
+1.604.633.9022
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
No securities regulatory authority has either
approved or disapproved of the contents of this news release. The
securities being offered have not been, and will not be, registered
under the United States Securities Act of 1933, as amended (the
‘‘U.S. Securities Act’’), or any state securities laws, and may not
be offered or sold in the United States, or to, or for the account
or benefit of, a "U.S. person" (as defined in Regulation S of the
U.S. Securities Act) unless pursuant to an exemption therefrom.
This press release is for information purposes only and does not
constitute an offer to sell or a solicitation of an offer to buy
any securities of the Company in any jurisdiction.
Cautionary Note Regarding Forward
Looking Statements
This announcement includes certain
“forward-looking statements” within the meaning of Canadian
securities legislation. All statements, other than statements of
historical fact, included herein, without limitation the use of net
proceeds, are forward-looking statements. Forward- looking
statements involve various risks and uncertainties and are based on
certain factors and assumptions. There can be no assurance that
such statements will prove to be accurate, and actual results and
future events could differ materially from those anticipated in
such statements. Important factors that could cause actual results
to differ materially from the Company’s expectations include
uncertainties relating to interpretation of drill results and the
geology, continuity and grade of mineral deposits; uncertainty of
estimates of capital and operating costs; the need to obtain
additional financing to maintain its interest in and/or explore and
develop the Company’s mineral projects; uncertainty of meeting
anticipated program milestones for the Company’s mineral projects;
and other risks and uncertainties disclosed under the heading “Risk
Factors” in the prospectus of the Company dated March 2, 2012 filed
with the Canadian securities regulatory authorities on the SEDAR
website at www.sedar.com
Non-GAAP Financial Measures
The items marked with a "(1)" are alternative
performance measures and readers should refer to Non-GAAP Financial
Measures in the Company's Management's Discussion and Analysis for
the year ended December 31, 2018 as filed on SEDAR and as available
on the Company's website for further details.
(1) Alternative performance measures; please
refer to “Non-GAAP Financial Measures” at the end of this
release.(2) Net of by-product credits(3) Subject to adjustments on
final settlement
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