Iberian Minerals Corp. (TSX VENTURE:IZN) today announced financial and operating
results for the three and six month periods ended June 30, 2012, with
comparative figures for the three and six month periods ended June 30, 2011. The
condensed interim consolidated financial statements and related notes, and
Management Discussion and Analysis may be found on www.sedar.com. Unless stated
otherwise, all reported figures are in U.S. dollars. The Company reported net
income of $25.46 million for Q2 2012, representing $0.05 per share.
Financial highlights:
Three months ended June 30, 2012
-- Recorded net income of $25.46 million or $0.05 per registered share
which included:
-- Sales of $124.25 million and gross gain of $31.40 million;
-- A realized gain of $4.75 million on commodity hedges (included in
sales) which contributed to the gross gain;
-- An unrealized non-cash gain of $29.08 million on derivative
financial instruments outstanding, principally as a result of
commodity hedging positions in copper and zinc that were delivered
into during the period and were thus retired.
-- Cash flow provided by operations before changes in working capital items
was $38.7 million.
Six months ended June 30, 2012
-- Recorded net income of $13.17 million or $0.03 per registered share
which included:
-- Sales of $210.78 million and gross gain of $37.87 million;
-- A realized loss of $11.44 million on commodity hedges (included in
sales) which partly net off the gross gain;
-- An unrealized non-cash gain of $13.71 million on derivative
financial instruments outstanding, principally as a result of
commodity hedging positions in copper and zinc that were delivered
into during the period and were thus retired.
-- Cash flow provided by operations before changes in working capital items
was $66.03 million.
Operational highlights - MATSA:
Three months ended June 30, 2012
-- MATSA processed 533,717 tonnes of ores in 2012 versus 466,444 tonnes of
ores in 2011 (increase of 67,273 tonnes or 14.4%).
-- Produced 29,091 DMT of copper concentrate (2011 - 28,300 DMT), 15,200
DMT of zinc concentrate (2011 - 15,236 DMT) and 4,614 DMT of lead
concentrate (2011 - 5,970 DMT). Contained metal production was 6,941 FMT
of copper (2011 - 6,216 FMT), 7,204 FMT of zinc (2011 - 7,307 FMT),
1,037 FMT of lead (2011 - 1,064 FMT) and 256,555 ounces of silver (2011
- 213,806 ounces).
-- The Cash Operating Cost (non-IFRS measure - refer to section 6) was
$1.15 per payable pound of copper (2011 - $1.73 per payable pound of
copper). Cash Operating cost was substantially reduced in 2012 due to
the combined effect of higher payable copper production (6,650 FMT in
2012 versus 5,933 FMT in 2011), lower operating cost realized at Matsa
and higher by-product metal production (US$13,46 million in 2012 versus
US$11,49 in 2011).
-- During the three months ended June 30, 2012, the Company terminated an
agreement with Cadillac Venture Inc. which extinguishes their 90%
interest on 14 of MATSA's properties located in the Iberian Pyrite Belt
of southern Spain. The consideration for the transaction was CAD$2.50
million. The transaction was accepted by TSX Venture Exchange. As of
June 30, 2012, the transaction was paid.
Six months ended June 30, 2012
-- MATSA processed 1,079,530 tonnes of ore in 2012 versus 980,528 tonnes of
ore in 2011 (increase of 99,002 tonnes or 10.1%).
-- Produced 57,196 DMT of copper concentrate (2011 - 55,708 DMT), 35,031
DMT of zinc concentrate (2011 - 32,602 DMT) and 11,321 DMT of lead
concentrate (2011 - 16,245 DMT). Contained metal production was 13,288
FMT of copper (2011 - 12,357 FMT), 16,597 FMT of zinc (2011 - 15,774
FMT), 2,861 FMT of lead (2011 - 2,998 DMT) and 529,445 ounces of silver
(2011 - 486,068 ounces).
-- The Cash Operating Cost was $1.16 per payable pound of copper (2011 -
$1.73 per payable pound of copper). Year-to-date Cash Operating cost was
substantially reduced in 2012 due to the combined effect of higher
payable production and higher by-product metal production. This
improvement has been consistent in the two quarters included in the six
months period ended June 30, 2012.
Operational - CMC:
Three months ended June 30, 2012
-- The average copper ore grade was 0.93% in 2012 versus 1.11% in 2011.
-- CMC processed 626,799 tonnes of ore in 2012 versus 593,290 tonnes of ore
in 2011 (increase of 33,509 tonnes or 5.6%).
-- Copper concentrate production in 2012 was 23,093 DMT versus 24,491 DMT
in 2011 (decrease of 1,398 DMT or 5.7%).
-- Contained copper production in 2012 was 5,313 FMT versus 5,931 FMT
tonnes in the prior year (decrease of 617 FMT or 10.4%).
-- The Cash Operating Cost in 2012 was $1.83 per payable pound of copper
versus prior year of $1.08.
Six months ended June 30, 2012
-- The average copper ore grade was 0.95% in 2012 versus 1.11% in 2011.
-- CMC processed 1,226,102 tonnes of ore in 2012 versus 1,172,028 tonnes of
ore in 2011 (increase of 54,074 tonnes or 4.6%).
-- Copper concentrate production in 2012 was 45,666 DMT versus 47,878 DMT
in 2011 (decrease of 2,212 DMT or 4.6%).
-- Contained copper production in 2012 was 10,526 FMT versus 11,699 FMT in
the prior year (decrease of 1,173 FMT or 10.0%).
-- The Cash Operating Cost in 2012 was $1.77 per payable pound of copper
versus prior year of $1.09.
Summarized Financial Results
The following table presents a summarized Statement of Operations for the three
and six months ended June 30, 2012 with comparatives for the three and six
months ended June 30, 2011.
Three months ended Six months ended
June 30, June 30,
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(thousands of U.S. Dollars) 2012 2011 2012 2011
----------------------------------------------------------------------------
$ $ $ $
Gross sales 119,502 146,108 222,218 241,976
Realized gains on derivative
financial instruments held for
trading 4,752 (59,965) (11,436) (118,604)
Sales 124,254 86,142 210,782 123,372
Costs and expenses of mining
operations 92,885 93,504 172,912 153,305
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Gross gain / (loss) 31,369 (7,362) 37,870 (29,933)
Expenses
Administrative expenses and other 13,744 1,625 22,547 3,071
Foreign exchange (gain) loss (1,125) 22 1,385 3,163
Contingent consideration fair value - - - -
Unrealized gain on derivative
instruments (29,079) (65,362) (13,706) (128,440)
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Total expenses (other income) (16,460) (63,715) 10,226 (122,206)
Operating income 47,829 56,353 27,644 92,273
Net finance costs 867 2,042 1,840 8,273
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Income before taxation 46,962 54,311 25,804 84,000
Current income tax expense 4,749 238 3,730 1,081
Future income tax expense 16,758 6,277 8,901 4,961
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Net income 25,455 47,796 13,173 77,958
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Basic earnings per share ($) 0.05 0.13 0.03 0.21
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Diluted earnings per share ($) 0.05 0.12 0.03 0.20
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Key operating statistics
CMC:
CMC operating statistics
-------------------------- -------------------- ---------------------
Three months Six months
Periods ended June 30, Unit 2012 2011 2012 2011
--------------------------------------------------------------------------
Ore mined t 641,691 591,530 1,273,982 1,179,485
Ore processed t 626,799 593,290 1,226,102 1,172,028
Copper ore grade % 0.93 1.11 0.95 1.11
Concentrate grade % 23 24 23 24
Copper recovery rate % 90 90 90 90
Copper concentrate DMT 23,093 24,491 45,666 47,878
Copper contained in
concentrate FMT 5,313 5,931 10,526 11,699
Gold contained in
concentrate oz 3,251 3,626 6,201 7,031
Silver contained in
concentrate oz 69,822 83,424 146,182 161,264
Payable copper contained
in concentrate FMT 5,057 5,658 10,029 11,164
Payable gold contained in
concentrate oz 2,943 3,283 5,592 6,366
Payable silver contained
in concentrate oz 68,605 74,706 131,125 144,412
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Cash Operating Cost per
lb of payable copper USD $ 1.83 $ 1.08 $ 1.77 $ 1.09
--------------------------------------------------------------------------
MATSA:
MATSA operating statistics
--------------------------------- ----------------- -----------------
Three months Six months
Periods ended June 30, Unit 2012 2011 2012 2011
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Copper ore
Ore mined t 269,243 316,274 552,469 620,961
Ore processed t 277,744 287,355 554,994 593,103
Copper ore grade % 1.95 2.23 2.05 2.21
Concentrate grade % 24 22 23 22
Copper recovery rate % 85 85 86 86
Copper concentrate DMT 19,605 24,854 42,297 50,609
Copper contained in concentrate FMT 4,615 5,439 9,710 11,231
Silver contained in concentrate oz 91,876 76,500 178,746 155,200
Payable copper contained in
concentrate FMT 4,419 5,191 9,287 10,725
Payable silver contained in
concentrate oz 72,967 52,505 137,950 106,416
Polymetallic ore
Ore mined t 259,911 200,377 523,707 414,557
Ore processed t 255,973 179,089 524,536 387,424
Zinc ore grade % 4.05 5.86 4.49 5.91
Zinc concentrate grade % 47 48 47 48
Zinc recovery rate % 70 70 71 69
Copper ore grade % 1.35 1.09 1.17 1.05
Copper concentrate grade % 25 23 24 22
Copper recovery rate % 68 40 68 28
Lead ore grade % 1.17 1.73 1.33 2
Lead concentrate grade % 22 18 25 19
Lead recovery rate % 34 34 40 43
Zinc concentrate DMT 15,200 15,236 35,031 32,602
Copper concentrate DMT 9,486 3,446 14,899 5,099
Lead concentrate DMT 4,614 5,970 11,321 16,245
Zinc contained in concentrate FMT 7,204 7,307 16,597 15,774
Copper contained in concentrate FMT 2,327 777 3,578 1,126
Lead contained in concentrate FMT 1,037 1,064 2,861 2,998
Silver contained in concentrate oz 164,679 137,306 350,699 330,868
Payable zinc contained in
concentrate FMT 5,988 6,088 13,795 13,163
Payable copper contained in
concentrate FMT 2,232 743 3,429 1,075
Payable lead contained in
concentrate FMT 899 884 2,521 2,510
Payable silver contained in
concentrate oz 102,902 80,707 211,492 205,362
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Cash Operating Cost per lb of
payable copper USD 1.15 1.73 1.16 1.73
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About Iberian Minerals Corp.
Iberian Minerals Corp. is a Canadian listed global base metals company with
interests in Spain and Peru. The Condestable Mine, located in Peru approximately
90 km south of Lima operates at 2.4 million tonnes per year producing copper,
and associated silver and gold in a concentrate. The Aguas Tenidas Mine is in
the Andalucia region of Spain approximately 110 km north-west of Seville and
operates a 2.2 million tonnes per year underground mine and concentrator that
produces copper, zinc and lead concentrates that also contain gold and silver.
Note 1 - The Cash Operating Cost per pound of payable copper is a non-IFRS
performance measure. It includes cash operating costs, including treatment and
refining charges ("TC/RC"), freight and distribution costs, and is net of
by-product metal credits (zinc, gold and silver). The Cash Operating Cost per
pound of payable copper indicator is consistent with the widely accepted
industry standard established by Brook Hunt and is also known as the C1 cash
cost.
FORWARD LOOKING STATEMENTS:
This news release contains certain "forward-looking statements" and
"forward-looking information" under applicable securities laws. Except for
statements of historical fact, certain information contained herein constitutes
forward-looking statements. Forward-looking statements are frequently
characterized by words such as "plan", "expect", "project", "intend", "believe",
"anticipate", "estimate", and other similar words, or statements that certain
events or conditions "may" or "will" occur. Forward looking information may
include, but is not limited to, statements with respect to the future financial
or operating performances of the Corporation, its subsidiaries and their
respective projects, the timing and amount of estimated future production,
estimated costs of future production, capital, operating and exploration
expenditures, the future price of copper, gold and zinc, the estimation of
mineral reserves and resources, the realization of mineral reserve estimates,
the costs and timing of future exploration, requirements for additional capital,
government regulation of exploration, development and mining operations,
environmental risks, reclamation and rehabilitation expenses, title disputes or
claims, and limitations of insurance coverage. Forward-looking statements are
based on the opinions and estimates of management at the date the statements are
made, and are based on a number of assumptions and subject to a variety of risks
and uncertainties and other factors that could cause actual events or results to
differ materially from those projected in the forward-looking statements. Many
of these assumptions are based on factors and events that are not within the
control of the Corporation and there is no assurance they will prove to be
correct. Factors that could cause actual results to vary materially from results
anticipated by such forward-looking statements include changes in market
conditions and other risk factors discussed or referred to in the section
entitled "Risk Factors" in the Corporation's annual information form dated March
29, 2010. Although the Corporation 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 Corporation undertakes no obligation to
update forward-looking statements if circumstances or management's estimates or
opinions should change except as required by applicable securities laws. The
reader is cautioned not to place undue reliance on forward-looking statements.
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