TIDMAAZ
RNS Number : 8087U
Anglo Asian Mining PLC
17 July 2018
Anglo Asian Mining plc / Ticker: AAZ / Index: AIM / Sector:
Mining
17 July 2018
Anglo Asian Mining plc
Q2 & H1 2018 Production and Operations Review
22 per cent. year-on-year increase in total production for H1
2018 and net debt reduced in Q2 2018 by $7.5 million to $2.9
million
Anglo Asian Mining plc ("Anglo Asian" or the "Company"), the AIM
listed gold, copper and silver producer focused in Azerbaijan, is
pleased to provide a production, sales and operations review for
its Gedabek gold, copper and silver mining and production contract
area ("Gedabek") in western Azerbaijan for the three months to 30
June 2018 ("Q2 2018") and six months to 30 June 2018 ("H1
2018").
Note that all references to "$" are to United States
dollars.
Overview
-- Continued improvement in total production in Q2 2018
expressed as gold equivalent ounces ("GEOs") with a four per cent.
quarter-on-quarter and a 19 per cent. year-on-year ("y-o-y")
increase to 19,042 GEOs
-- 22 per cent. y-o-y increase in H1 2018 total production to 37,349 GEOs
-- Net debt reduced to $2.9 million at end of June 2018 and all
debt repaid except for the Pasha Bank low cost refinancing loan by
5 July 2018
-- Second crusher line now in operation at Gedabek with the
agitation leaching and flotation plants now processing
independently
Anglo Asian CEO Reza Vaziri commented, "Thanks to the successful
completion of several initiatives, both operational and financial,
Anglo Asian has delivered excellent performance in both the second
quarter and first half of 2018. Our production from Gedabek
continues on its upward trajectory with a 22 per cent. year on year
increase in total production measured as gold equivalent ounces for
the first half and we expect to see increased copper production
this current quarter now the second crusher line is operating.
"The increase in total production has resulted in an outstanding
financial performance with net debt in the quarter reducing by $7.5
million to $2.9 million. Furthermore, Anglo Asian had repaid all
the Group's outstanding borrowings in early July, save for the
Pasha Bank refinancing loan which bears interest at a fixed 7 per
cent. - a rate which is considerably lower than Anglo Asian's
recent average cost of borrowing.
"Our operations are moving up a gear with the new Ugur mine and
second crusher line adding significantly to our production capacity
and, I believe, we are well placed to meet our FY 2018 production
target of between 78,000 to 84,000 gold equivalent ounces. We are
accordingly creating a sound financial position from which to
announce and pay a maiden dividend, in line with our previous
announcements, following completion of the share capital reduction
proposed in the recent circular to Shareholders."
Production Overview
Q2 2018
-- 19 per cent. y-o-y increase in total production to 19,042 GEOs (Q2 2017: 15,984 ounces)
-- 38 per cent. y-o-y increase in gold production to 16,764 ounces (Q2 2017: 12,140 ounces):
o 15,532 ounces contained within gold doré
o 6 ounces from SART processing
o 1,226 ounces from flotation
-- Copper production totalled 332 tonnes (Q2 2017: 716 tonnes):
o 137 tonnes from SART processing
o 195 tonnes from flotation processing
-- Silver production totalled 44,201 ounces (Q2 2017: 45,718 ounces):
o 6,014 ounces contained within gold doré
o 21,800 ounces from SART processing
o 16,387 ounces from flotation
H1 2018
-- 22 per cent. y-o-y increase in total production to 37,349 GEOs (H1 2017: 30,561 GEOs)
-- 43 per cent. y-o-y increase in gold production to 33,255 ounces (H1 2017: 23,218 ounces)
-- Copper production totalled 587 tonnes (H1 2017: 1,322 tonnes)
-- Silver production totalled 84,785 ounces (H1 2017: 85,087 ounces)
-- Well positioned to achieve forecast production for FY 2018 of between 78,000 to 84,000 GEOs
Sales overview
-- Q2 2018 gold bullion sales of 10,822 ounces at an average of
$1,307 per ounce (Q2 2017: 7,406 ounces at an average of $1,258 per
ounce)
-- Q2 2018 copper concentrate shipments to the customer totalled
1,736 dry metric tonnes ("dmt") with a sales value of $4.2 million
(excluding Government of Azerbaijan production share) (Q2 2017:
3,166 dmt with a sales value of $6.1 million)
Company financials
-- Net debt, being interest-bearing loans and borrowings, less
cash and cash equivalents, totalled $2.9 million at 30 June 2018
($10.4 million at 31 March 2018)
-- All outstanding borrowings repaid by 5 July 2018, except the
Pasha Bank refinancing loan which has a current balance of $11.8
million with a fixed interest rate of 7 per cent. (see RNS dated 12
February 2018 for details of the Pasha Bank refinancing loan
facility)
Operations review
The Company mined the following ore in the six months ended 30
June 2018:
12 months to 3 months to 3 months to
31 December 2017 31 March 2018 30 June 2018
Average Average Average
Mine Ore mined gold grade Ore mined gold grade Ore mined gold grade
(tonnes) (g/t) (tonnes) (g/t) (tonnes) (g/t)
---------- ------------ ---------- ------------ ---------- ------------
Open pit 712,444 1.18 28,326 0.92 22,732 0.99
Ugur - o/pit 238,818 3.20 288,214 0.96 173,168 1.87
Gadir -
u/g 80,614 3.56 19,948 5.86 25,411 4.43
Gosha -
u/g 28,284 3.99 - - - -
---------- ------------ ---------- ------------ ---------- ------------
Total 1,060,160 1.89 336,488 1.25 227,311 2.02
============== ========== ============ ========== ============ ========== ============
Anglo Asian stacked 150,573 tonnes of dry crushed ore on to heap
leach pads with an average gold content of 0.91 g/t of gold (Q1
2018: 170,655 tonnes with an average gold content of 0.92 g/t of
gold) during Q2 2018. The Company also heap leached uncrushed Run
of Mine ("ROM") ore. During Q2 2018, Anglo Asian stacked 77,493
tonnes of ROM ore on to heap leach pads with an average gold
content of 0.51 g/t of gold (Q1 2018: 188,364 tonnes with an
average gold content of 0.51 g/t of gold).
The Company processed 196,107 dry tonnes of ore with an average
gold content of 2.19 g/t of gold through the agitation leaching
plant (Q1 2018: 184,198 tonnes with an average gold content of 2.07
g/t of gold through the agitation leaching plant) in Q2 2018.
The Company produced gold doré containing 15,532 ounces of gold
and 6,014 ounces of silver at Gedabek (Q1 2018: 15,750 ounces of
gold and 7,110 ounces of silver) in Q2 2018. During Q2 2018, the
agitation leaching plant produced 10,505 and 4,136 ounces of gold
and silver, respectively, and the heap leach operations produced
5,027 and 1,878 ounces of gold and silver, respectively.
SART processing in Q2 2018 produced 260 dmt of copper
concentrate containing 137 tonnes of copper and 6 ounces of gold
(Q1 2018: 223 dmt of copper concentrate containing 114 tonnes of
copper and 6 ounces of gold). Flotation processing in Q2 2018
produced 1,396 dmt of copper concentrate containing 195 tonnes of
copper and 1,226 ounces of gold (Q1 2018: 819 dmt of copper
concentrate containing 141 tonnes of copper and 735 ounces of
gold).
The Company sold 1,735 dmt of copper concentrate in Q2 2018 for
$4.2 million compared to 608 dmt for $1.7 million in Q1 2018
(excluding Government of Azerbaijan production share).
The following table summarises gold doré production and sales at
Gedabek for FY 2017 and H1 2018:
Gold produced* Silver Gold sales** Gold Sales
(ounces) Produced* (ounces) price
(ounces) ($/ounce)
Quarter ended
31 March 2017 9,258 2,447 8,283 1,220
30 June 2017 9,131 3,266 7,406 1,258
H1 2017 18,389 5,713 15,689 1,238
30 Sept 2017 12,221 4,381 9,287 1,286
31 Dec 2017 21,924 12,634 18,520 1,278
H2 2017 34,145 17,015 27,807 1,281
FY 2017 52,534 22,728 43,496 1,265
31 March 2018 15,750 7,110 14,956 1,328
30 June 2018 15,532 6,014 10,822 1,307
H1 2018 31,282 13,124 25,778 1,319
-------------- -------------- ----------- ------------- ----------
Note that some of the figures in the above table may differ from
previously reported due to agreement of final assay.
* including Government of Azerbaijan's share
** excludes Government of Azerbaijan's share
The following table summarises copper concentrate production
from both its SART and flotation plants at Gedabek for FY 2017 and
H1 2018:
Concentrate Copper Gold Silver
production* content* content* content*
2017 (dmt) (tonnes) (ounces) (ounces)
Quarter ended 31 March
SART processing 428 210 5 5,523
Flotation 2,312 396 1,815 31,399
Total 2,740 606 1,820 36,922
Quarter ended 30 June
SART processing 419 187 4 4,717
Flotation 3,203 529 3,005 37,735
Total 3,622 716 3,009 42,452
Quarter ended 30 Sept
SART processing 333 165 4 9,097
Flotation 2,379 385 2,243 26,810
Total 2,712 550 2,247 35,907
Quarter ended 31 December
SART processing 256 119 7 34,844
Flotation - - - -
Total 256 119 7 34,844
2018
Quarter ended 31 March
SART processing 223 114 6 21,887
Flotation 819 141 735 11,587
Total 1,042 255 741 33,474
Quarter ended 30 June
SART processing 260 137 6 21,800
Flotation 1,136 195 1,226 16,387
Total 1,396 332 1,232 38,187
--------------------------- ------------ --------- --------- ---------
* including Government of Azerbaijan's share.
The following table summarises copper concentrate production and
sales at Gedabek for FY 2017 and H1 2018. Note that sales of
concentrates are initially recorded at provisional amounts until
agreement of final assay:
Concentrate Copper Gold Silver Concentrate Concentrate
production* content* content* content* sales** sales**
(dmt) (tonnes) (ounces) (ounces) (dmt) ($000)
Quarter ended
31 March 2017 2,740 606 1,820 36,922 2,230 4,220
30 June 2017 3,622 716 3,009 42,452 3,166 6,104
H1 2017 6,362 1,322 4,829 79,374 5,396 10,324
30 Sept 2017 2,712 550 2,247 35,907 2,905 5,480
31 Dec 2017 256 119 7 34,844 198 854
H2 2017 2,968 669 2,254 70,751 3,103 6,334
FY 2017 9,330 1,991 7,083 150,125 8,499 16,658
31 March 2018 1,042 255 741 33,474 608 1,715
30 June 2018 1,396 332 1,232 38,187 1,736 4,221
H1 2018 2,438 587 1,973 71,661 2,344 5,936
--------------- ------------ --------- --------- --------- ------------- --------------
Note that certain figures are different to those previously
disclosed due to final reconciliation of concentrate production and
sales.
* including Government of Azerbaijan's share
** excludes Government of Azerbaijan's share
Company financial review
Net debt
The Company had net debt at 30 June 2018 of $2.9 million, a
reduction of $7.5 million since 31 March 2018.
$m
Kapital Bank 1.0*
Pasha Bank - refinancing loan 11.8
Pasha Bank - other loans 2.6*
Total loans 15.4
Cash on hand and at bank (12.5)
--------
Net debt 2.9
--------
* These loans totalling $3.6 million were repaid by 5 July
2018.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
**ENDS**
For further information please visit www.angloasianmining.com or
contact:
Reza Vaziri Anglo Asian Mining plc Tel: +994 12 596 3350
Bill Morgan Anglo Asian Mining plc Tel: +994 502 910 400
------------------------------ ----------------------
Stephen Westhead Anglo Asian Mining plc Tel: +994 502 916 894
------------------------------ ----------------------
Ewan Leggat SP Angel Corporate Finance Tel: +44 (0) 20 3470
LLP 0470
Nominated Adviser and Broker
------------------------------ ----------------------
Soltan Tagiev SP Angel Corporate Finance Tel + 44 (0) 20 3470
LLP 0470
------------------------------ ----------------------
Susie Geliher St Brides Partners Ltd Tel: +44 (0) 20 7236
1177
------------------------------ ----------------------
Lottie Wadham St Brides Partners Ltd Tel: +44 (0) 20 7236
1177
------------------------------ ----------------------
Notes:
Anglo Asian Mining plc (AIM:AAZ) is a gold, copper and silver
producer in Central Asia with a broad portfolio of production and
exploration assets in Azerbaijan. The Company has a 1,962 square
kilometre portfolio, assembled from analysis of historic Soviet
geological data and held under a Production Sharing Agreement
modelled on the Azeri oil industry.
The Company's main operating location is the Gedabek contract
area ("Gedabek") which is a 300 square kilometer area in the lesser
Caucasus mountains in western Azerbaijan. The Company developed
Azerbaijan's first operating gold/copper/silver mine at Gedabek
which commenced gold production in May 2009. Mining at Gedabek was
initially from its main open pit which is an open cast mine with a
series of interconnected pits. The Company also operates the high
grade Gadir underground mine which is co-located at the Gedabek
site, In September 2017, production commenced at the Ugur open pit
mine, a recently discovered gold ore deposit at Gedabek. The
Company has a second underground mine, Gosha, which is 50
kilometres from Gedabek. Ore mined at Gosha is processed at Anglo
Asian's Gedabek plant.
The Company produced 71,461 gold equivalent ounces ('GEOs') for
the year ended 31 December 2017. Gedabek is a polymetallic ore
deposit that has gold together with significant concentrations of
copper in the main open pit mine, and an oxide gold-rich zone at
Ugur. The Company therefore employs a series of flexible processing
routes to optimise metal recoveries and efficiencies. The Company
produces gold doré through agitation and heap leaching operations,
copper concentrate from its Sulphidisation, Acidification,
Recycling, and Thickening (SART) plant and also a copper and
precious metal concentrate from its flotation plant, which is
processing tailings from the agitation leach plant. A second
dedicated crusher line has recently been commissioned and is now in
operation for the flotation plant to enable it to operate
independently of the agitation leaching plant.
The Company has forecast production for FY 2018 of between
78,000 to 84,000 GEOs an increase for the mid-point of this
guidance of over 13 per cent. compared to FY 2017 production of
71,461 GEOs.
Anglo Asian is also actively seeking to exploit its first mover
advantage in Azerbaijan to identify additional projects, as well as
looking for other properties in order to fulfil its expansion
ambitions and become a mid-tier gold and copper metal production
company.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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