Capstone Mining 2013 Second Quarter Production Results
Capstone Mining 2013 Second Quarter Production Results
| Q2 2013 Production | |||
| Q1 | Q2 | YTD 2013 | |
| Cozamin | |||
| Copper in concentrates (thousands of pounds) | 10,142 | 12,123 | 22,265 |
| C1 cash cost per pound(1) | $1.06 | $1.22 | $1.15 |
| Minto | |||
| Copper in concentrates (thousands of pounds) | 8,444 | 7,201 | 15,645 |
| C1 cash cost per pound(1) | $2.50 | $2.49 | $2.49 |
| Total | |||
| Copper in concentrates (thousands of pounds) | 18,586 | 19,324 | 37,910 |
| C1 cash cost per pound(1) | $1.72 | $1.70 | $1.71 |
Both operations continued to run well in the quarter, each breaking mill throughput records, said Darren Pylot, President and CEO of Capstone. At Cozamin, we were able to completely make up for the first quarter production shortfall and ended the quarter with production back on plan. At Minto, year-to-date production is on plan, and we are adding resources to ensure we catch up mining from the pit wall failure that occurred in the fourth quarter of 2012.
Operational Highlights for the Three and Six Months Ended June 30, 2013
- Production of 19.3 and 37.9 million pounds of copper contained in concentrates, respectively.
- By-product production of 4.2 and 9.2 million pounds of zinc, 1.1 and 2.0 million pounds of lead and 478,573 and 880,845 ounces of silver in concentrates. Final gold production is not available since assaying is conducted off-site, but is estimated at 2,839 and 6,341 ounces for the respective periods.
- At Cozamin, additional short and long term sources of water were secured, resulting in higher second quarter throughput rates that have production for the year back on plan as of June 30. In the second quarter, the mill broke both monthly (3,685 tonnes per day in May) and quarterly (3,548 tonnes per day) throughput records.
Costs on a per pound basis are higher than planned due to the effect of a strengthening Mexican Peso, additional costs to secure water sources and higher contractor costs for haulage. Costs for the remainder of the year are expected to run at the top end of Cozamin's 2013 C1 cash cost(1) guidance of $1.00 to $1.10 per pound.
- At Minto, operations continued to improve in the second quarter. The mill is running very well and broke a monthly throughput record, processing 4,154 tonnes per day in May. Ore that was deferred from the fourth quarter of 2012, due to the stability issues in the west pit highwall, was accessed in the first quarter and the mining rate now needs to increase to get to the high grade ore planned for later in the year. Site personnel have taken advantage of additional dig faces to increase the mining rate, and are working with the mining contractor to improve operating flexibility and productivity. Expenditures for the quarter were in line with expectations; however, unit costs were lower than expected due to additional deferral of stripping costs.
| Q2 2013 Operating Details | ||||
| Cozamin | Minto | |||
| Q2 2013 | YTD 2013 | Q2 2013 | YTD 2013 | |
| Production(2) (contained in concentrates) | ||||
| - Copper (000s pounds) | 12,123 | 22,265 | 7,201 | 15,645 |
| - Zinc (000s pounds) | 4,238 | 9,187 | - | - |
| - Lead (000s pounds) | 1,112 | 2,049 | - | - |
| - Silver (ounces) | 452,473 | 818,996 | 26,100 | 61,849 |
| - Gold (ounces) | - | - | 2,839 | 6,341 |
| Mine (tonnes) | ||||
| - Ore | 299,677 | 596,526 | 106,146 | 522,648 |
| - Waste | - | - | 3,052,103 | 5,302,914 |
| Mill | ||||
| - Tonnes processed | 322,829 | 598,729 | 349,609 | 682,955 |
| - Tonnes processed per day | 3,548 | 3,308 | 3,842 | 3,773 |
| - Copper grade (%) | 1.83 | 1.82 | 1.03 | 1.14 |
| - Zinc grade (%) | 0.95 | 1.08 | - | - |
| - Lead grade (%) | 0.26 | 0.25 | - | - |
| - Silver grade (g/t) | 61.3 | 59.8 | 3.3 | 3.8 |
| - Gold grade (g/t) | - | - | 0.35 | 0.38 |
| Recoveries | ||||
| - Copper (%) | 92.9 | 92.8 | 90.5 | 90.8 |
| - Zinc (%) | 62.6 | 64.2 | - | - |
| - Lead (%) | 59.6 | 61.0 | - | - |
| - Silver (%) | 71.1 | 71.2 | 70.9 | 75.0 |
| - Gold (%) | - | - | 73.0 | 76.0 |
| Concentrates(2) | ||||
| - Copper concentrates (dmt) | 21,316 | 38,644 | 9,173 | 19,848 |
| Copper (%) | 25.8 | 26.1 | 35.6 | 35.8 |
| Silver (g/t) | 566 | 558 | 88 | 96.9 |
| Gold (g/t) | - | - | 9.6 | 9.9 |
| - Zinc concentrates (dmt) | 4,002 | 8,682 | - | - |
| Zinc (%) | 48.0 | 48.0 | - | - |
| - Lead concentrates (dmt) | 846 | 1,561 | - | - |
| Lead (%) | 59.6 | 59.5 | - | - |
| Silver (g/t) | 2,363 | 2,504 | - | - |
| Payable copper produced (000s lbs) | 11,596 | 21,307 | 6,966 | 15,136 |
| C1 cash cost(1) (per pound of payable of copper produced) | $1.22 | $1.15 | $2.49 | $2.49 |
Outlook
Capstone's 2013 guidance at Cozamin and Minto for 85 million pounds 5% of copper in concentrates, at a C1 cash cost(1) of $1.65 to $1.75 per pound of payable copper, net of by-product credits and selling costs, remains unchanged.
Q2 Financial Results Timing
Capstone will report 2013 second quarter financial results on Tuesday, July 30, 2013 after market close, followed by a conference call and webcast for investors and analysts on Wednesday, July 31, 2013 at 11:30 am Eastern Time (8:30 am Pacific Time).
Conference Call and Webcast Details
| Date: | Wednesday, July 31, 2013 | |
| Time: | 11:30 am Eastern Time -- 8:30 am Pacific Time | |
| Dial in: | North America: 1-888-390-0605, International: +416-764-8609 | |
| Webcast: | http://www.newswire.ca/en/webcast/detail/1178711/1290143 | |
| Replay: | North America: 1-888-390-0541, International: +416-764-8677 | |
| Replay Passcode: | 363769 |
About Capstone Mining Corp.
Capstone Mining Corp. is a Canadian base metals mining company, committed to the responsible development of our assets and the environments in which we operate. We are preferentially focused on copper, with two producing copper mines, the Cozamin copper-silver-zinc-lead mine located in Zacatecas State, Mexico and the Minto copper-gold-silver mine in Yukon, Canada. In addition, Capstone has two development projects, the large scale 70% owned Santo Domingo copper-iron-gold project in Chile in partnership with Korea Resources Corporation and the 100% owned Kutcho copper-zinc-gold-silver project in British Columbia, as well as exploration at properties in Canada, Chile, Mexico and Australia. Using our cash flow and strong balance sheet as a springboard, Capstone aims to grow with continued mineral resource and reserve expansions, exploration, and through acquisitions in politically stable, mining-friendly regions. Our headquarters are in Vancouver, Canada and we are listed on the TSX. Further information is available at www.capstonemining.com.
For further information please contact:
Cindy Burnett, VP, Investor Relations and Communications 604-637-8157 cburnett@capstonemining.com
Cautionary Note Regarding Forward-Looking Information
This document may contain forward-looking information within the meaning of Canadian securities legislation and forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, forward-looking statements). These forward-looking statements are made as of the date of this document and Capstone Mining Corp. (the Company) does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities legislation.
Forward-looking statements relate to future events or future performance and reflect Company management's expectations or beliefs regarding future events and include, but are not limited to, statements with respect to the estimation of mineral reserves and mineral resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, success of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims and limitations on insurance coverage. In certain cases, forward-looking statements can be identified by the use of words such as plans, expects or does not expect, is expected, outlook, budget, scheduled, estimates, forecasts, intends, anticipates or does not anticipate, or believes, or variations of such words and phrases or statements that certain actions, events or results may, could, would, might or will be taken, occur or be achieved or the negative of these terms or comparable terminology. In this document certain forward-looking statements are identified by words including scheduled, guidance, plan, planned, estimated, projections, projected and expected. By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, risks related to actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of mineral resources; possible variations in ore reserves, grade or recovery rates; accidents; dependence on key personnel; labour pool constraints; labour disputes; availability of infrastructure required for the development of mining projects; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; and other risks of the mining industry as well as those factors detailed from time to time in the Company's interim and annual financial statements and management's discussion and analysis of those statements, all of which are filed and available for review on SEDAR at www.sedar.com. 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 as 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. Accordingly, readers should not place undue reliance on forward looking statements.
National Instrument 43-101 Compliance
Unless otherwise indicated, Capstone has prepared the technical information in this news release (Technical Information) based on information contained in the technical reports, news releases and MDA's (collectively the Disclosure Documents) available under Capstone Mining Corp.'s company profile on SEDAR at www.sedar.com. Each Disclosure Document was reviewed and approved by a qualified person (a Qualified Person) as defined in National Instrument 43-101 Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators (NI 43-101). Readers are encouraged to review the full text of the Disclosure Documents which qualifies the Technical Information. Readers are advised that mineral resources that are not mineral reserves do not have demonstrated economic viability. The Disclosure Documents are each intended to be read as a whole, and sections should not be read or relied upon out of context. The Technical Information is subject to the assumptions and qualifications contained in the Disclosure Documents.
The disclosure of the Technical Information contained in this news release has been reviewed and approved by Stephen Winkelmann, Capstone VP of North American Operations, Registered Member of The Society for Mining, Metallurgy, and Exploration, Inc. (SME), a Qualified Person under NI 43-101. In addition, Gregg Bush, Senior Vice President and Chief Operating Officer reviewed all Technical Information in this news release.
Alternative Performance Measure
The item marked with (1) C1 Cash Cost per Pound of Payable Copper Produced is an Alternative Performance Measure. This performance measure is included because this statistic is a key performance measure that management uses to monitor performance. Management uses this statistic to assess how the Company is performing to plan and to assess the overall effectiveness and efficiency of mining operations. This performance measure does not have a meaning within IFRS and, therefore, amounts presented may not be comparable to similar data presented by other mining companies. This performance measure should not be considered in isolation as a substitute for measures of performance in accordance with IFRS.
Cautionary Note to United States Investors
This news release contains disclosure that has been prepared in accordance with the requirements of Canadian securities laws, which differ from the requirements of U.S. securities laws. Without limiting the foregoing, this news release uses the terms indicated and inferred resources. U.S. investors are cautioned that, while such terms are recognized and required by Canadian securities laws, the SEC does not recognize them. Under U.S. standards, mineralization may not be classified as a reserve unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. U.S. investors are cautioned not to assume that all or any part of indicated resources will ever be converted into reserves. U.S. investors should also understand that inferred resources have a great amount of uncertainty as to their existence and as to whether they can be mined legally or economically. It cannot be assumed that all or any part of inferred resources will ever be upgraded to a higher category. Therefore, U.S. investors are also cautioned not to assume that all or any part of inferred resources exist, or that they can be mined legally or economically. Accordingly, information concerning descriptions of mineralization and resources contained in this news release may not be comparable to information made public by U.S. companies subject to the reporting and disclosure requirements of the SEC.
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